Retail Observer

RETAILOBSERVER.COM MAY 2015 46 F or the retailer, adding outdoor furniture can do quite a bit more than just setting the store's tone and bringing customers in who are seeking step-up outdoor furniture. It presents a great opportunity to capitalize on steep margins—up to 50 points plus—and increase profitability. But you have to do it right. In this column we'll explore some guidelines for navigating the outdoor furniture market. • Differentiate From Big Box Retailers— First and foremost, you must differentiate yourself from the big box retailers like Lowe's, Home Depot, Wal-Mart, and Costco, who are major players in this market. For one, you'll never compete with these stores head-to-head in terms of price. They buy container direct and purchase mass quantities, allowing them to drive prices to their lowest. That being said, these megastores also don't offer a lot of options. In fact, in many homes, you'll see the exact same furniture purchased at a variety of stores. Depending on the quality of your own store, you can add higher-quality outdoor furniture that these megastores simply won't carry. This is also where those higher margins are going to come into play. Klaussner Outdoor furniture (www.klaussneroutdoor.com), for example, is a company that offers high-quality furniture sourced in Asia but with a upholstery arm in North Carolina that offers premium covers and finishes. If you or your customer likes a piece of furniture, you can have it upholstered from Klaussner in different custom fabrics in as little as 30 days. • Sell Longevity — Selling step-up furniture is not necessarily a hard sell, either. It's easy for a homeowner to relate to the normal wear and tear that will happen from the outdoors, especially when making a significant investment in patio furniture. The inexpensive products from the big box stores will only last a season or two at best before they'll need to be thrown out. With higher-quality outdoor furniture, manufacturers design their wares to last longer, with consideration given to weatherproofing, sunlight, and other elements like salt water. Sunbrella fabrics, for example, are built to resist fading from the sun, mold, and moisture issues. Customers can leave better-end products in the rain and not have to worry about rust. Really, the investment in better outdoor furniture is something that the homeowner will save money on in the long run simply due to the fact that he or she will not need to replace outdoor furniture every couple of years. • Get In and Get Out—For those looking to add outdoor furniture sales to their product mix, it's important to be sensitive to the highly seasonal nature of outdoor furniture sales. You really need to begin selling in February, and be out of it by July. The last thing you want to do is sit on inventory until the next season rolls around. • If You Build It, Will They Come?— The next question you might be asking yourself is: What about the thriving catalog and online market? Companies like Frontgate, not to mention furniture retailers with online presence like Pottery Barn and Restoration Hardware offer outdoor furniture. But one thing we've learned over the years is that while many of our customers do their product research online, they still want to experience the furniture in person. They want to see how a chair or lounger "sits" and how comfortable it is. They want to see what the wood grain looks like in real life, not on a screen. That's the advantage of a brick-and-mortar store. Additionally, catalogs can be extraordinarily expensive. We priced one outdoor set at nearly $20,000, and prices only go up from there. Whatever your current product mix may be, think about adding outdoor furniture to your lineup. You'll attract new customers, benefit from higher margins, and ultimately, create happy customers who can now enjoy the great outdoors in greater comfort and style. And happy customers, after all, are repeat customers. RO Mike Allen Furniture Trends E. Michael Allen, BrandSource VP of home furnishings, has been with the organization for 15 years and overseen the growth of the category to one of the largest in the country. SHOULD YOU ADD OUTDOOR FURNITURE TO THE M IX? Outdoor furniture is an attractive option for retailers, but you have to do it right to succeed

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