The home furnishings industry during the 1990s has to deal with a multitude of uncertainties that will grow during the decade. Retailers must remain open to change and learn not to depend on what was done in the past. Areas of uncertainty include the new Republican Congress and its affect on political changes, competitive uncertainty and credit uncertainty. There’s is also much uncertainty about consumer buying.
In 1954, when asked his opinion about all the change taking place in the world, Dwight Eisenhower responded:
Things are more like they are today than they have ever been before
The pundits of his day ridiculed Ike for obfuscating even the simplest questions. But Eisenhower was right. He is even more right today.
What Ike was trying to say in his own roundabout way was that we live in unprecedented times. There are no historical comparisons, no previous trailblazers to point the way. In an age without precedents, past experience is no longer a virtue. In fact it may be a detriment.
The lesson home goods retailers need to embrace is that we are all trailblazers now. From politics to economics, from new competition to changes in consumer trends, home goods retailers face a complex and at times confusing array of change agents that make managing a business today more difficult than it has ever been before.
Take politics. It has been nearly 50 years since the United States last had a Republican Congress and a Democratic President. In 1946, the Republicans swept the mid-term elections on a platform of change, a grass roots dislike of President Truman and a general weariness with the New Deal Democrats.
The new alignment of power may result in political bickering as it did back in 1946. Two years of gridlock would not be all bad economically. Just imagine: no change in taxation, no new regulations, no health care reform, no reform of welfare. It’s not the best possible outcome, but it’s not all that bad, and the economy would continue to grow. Read more about The Home Furnishings Industry …
Another option, which implies more risk, is to stock up on merchandise in the warehouse. “We try to plan around late shipments by keeping our warehouse distribution center full,” Altmeyer explained. “When we know reorders are running late, we can often work with what we have.”
Stockpiling does not always work, however. ever. Altmeyer’s is maintaining more stock in its warehouse, but even this does not help when a vendor discontinues a particular product. “One firm that we buy woven bedspreads from has converted their production to throws and is not producing the bedspreads,” Altmeyer said. “So what are we supposed to do?” One change the chain made to better adapt to vendor shifts was to stockpile four months worth of merchandise, rather than keeping only a two-month supply, as it had done previously.
Small stores are also looking to alternative sources of supply to replace companies that chronically deliver late or incomplete orders. This does not mean, however, that stores stop buying from key vendors completely. “We need diversification in our product mix,” said The Linen Loft’s Horesh. “We cannot stop buying from a company because deliveries are slow, but if there is a choice of leaning toward the one that has a better shipping record, we will.”
Some retailers seek out smaller vendors simply because they want to cut back on the red tape. “We enjoy doing business with smaller manufacturers because there are less layers of management to go through,” Altmeyer said. Nevertheless, like most retailers, he said maintaining a well-balanced merchandise mix requires working with large and small vendors.
Read more about Home Textile Retailers Complain Of Late Order Deliveries …
Small retailers of home textiles believe that they suffer the most from late merchandise deliveries. Small retailers say that their orders are left to be filled last after the large chains have been supplied. Some small retailers develop personal relationships with vendors in order to help alleviate the problem. Laytner’s Linens co-owner Alan Laytner says that being small is a definite disadvantage regarding deliveries, because the larger chains are able to send their orders electronically. Generally, the best recourse is to complain loudly about late or short orders.
Late delivery is a classic headache in the home textiles business. For just about everybody. But small retailers, those operating just a handful of stories. say, they’re in the worst shape of all. they believe their orders get pushed aside by vendors who give larger chains first dibs on what’s available.
So what’s a little guy to do? Some go out of their way to cultivate personal relationships with vendors. Others turn to alternative, often smaller manufacturers. Still, others tie up more of their cash in inventory.
Several retailers have told HFD that their stores get late or incomplete deliveries because many vendors give priority to larger orders from national retailers – retailers who are able to send their orders electronically.
Read more about Small Retailers Of Home Textiles …