Retail Observer

RETAILOBSERVER.COM AUGUST 2015 52 Mike Allen Furniture Trends HOW TO COMPETE WITH BIG FURNITURE The independent furniture retailer has competitive advantages over the big firms–learn how to capitalize on them A fter the residential real estate market dipped, consumers bought fewer homes. Fewer homes meant fewer beds and mattresses. But according to the "Bed & Mattress Stores in the US" market research report published by IBISWorld in March, disposable income and new household formations are rebounding, as will Bed and Mattress Store revenue. Pent-up demand and new technology, the study says, will lift revenue in the next five years to 2020. It will be a nice big pie to share, but as an independent retailer you don't want big furniture gobbling it all up—especially now that more and more furniture and mattress chains are moving into smaller markets. For example, one major mattress giant—Mattress Firm—added more than 40 stores from 2009 to 2013 in the Houston area alone. While this encroachment might put some independent retailers in a state of panic, the good news is that there is plenty of pie to go around. Plus, there are distinct ways that the independent specialty retailer can compete. Knowing your strengths and capitalizing on them will help you thrive, even with the mattress giants looming nearby. • Be unique, think locally, and own it—We talked with one mattress manufacturer, who prefers to remain anonymous, to get an insider's perspective on how the independent retailer can effectively compete in a growing market. "Large retailers have a cookie-cutter approach, so in order for small retailers to compete, they have to be unique within the marketplace," he says. "If you are going to implement free delivery, have the very best free delivery in town. If it's the best selection you're touting, yell it from the highest mountaintop. Be unique and own whatever it is you stand for." Many times, when a large retailer comes into a smaller market, the independent retailer adapts a 'me too' strategy. If the big retailer has a sale, the small retailer matches it. They will even try to amplify their advertising efforts. "In cases like these, the big retailer will win every time because they have more advertising, bigger budgets, and more voice share," says the mattress exec. "Pick something that you can hang your hat on and don't worry about looking over your shoulder all the time." We covered other ways to compete locally in a previous column, but to summarize here, it's a good idea to pay attention to your social media and search-optimize your website so that it will appear higher in local search results. Anything you can do to create more online visibility in this increasingly digital world, whether it's telling folks you are on Yelp, participating in local community events, or making sure that your Google My Business page is up to snuff, will help you to succeed locally. • Compete on price—One area where the independent furniture stores will always be able to compete with the furniture giants is on price. That's because the big chains have to have big margins in order to cover their massive advertising budgets. Pay attention to the prices the retailers are offering and stay competitive. Be sure to stay well-stocked on add-on-sale items like pillows and mattress covers to boost the overall ticket price. • Succeed with service—Another way that the independent furniture/ mattress retailer can succeed is through service. The independents have better-trained salespeople and don't fall prey to the same pitfalls as huge corporate entities that have only one way of doing it. While the mattress giants may look good to Wall Street because they are publicly traded, the consumer is the person who is doing the shopping. Focus on making them happy, and you'll win customers. It's a one-two punch of great service at a great price. • Display your best—Finally, when competing with huge chains, the independent retailer must go out of his way to make sure its show floor looks its very best. What does your interior store look like? Are the doors clean or covered with fingerprints? Are the mattress rimmed with a gray line of dirt? When was the last time your interior walls were painted? Are your carpets worn out? If you walk your showroom, do you have "holes" in your floor or unattractive pieces that you can't move? Take a good look at your store and give it a facelift. It will reinvigorate your team and attract new customers. Most importantly, when you are selling, always remember that it is all about the customer. You're selling more than a mattress— you're selling a lifestyle of a good night sleep and good health. Why? Because your customer deserves it! 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. RO

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