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Is the Brick-And-Mortar Furniture Industry in a Tailspin? with Warren Shoulberg

2020-04-01

Is the furniture industry spiraling out of control due to the likes of online retailers such as Wayfair and Houzz? What impact do these online monoliths make on brick-and-mortar retail giants? Warren Shoulberg joins Darla and Natalie to dissect the industry—he shares who he thinks the winners are, who will tailspin out of business, and where interior design showrooms fall in the mix. Warren is an award-winning Journalist & Consultant for the home furnishing industry. He’s a regular contributor to Forbes and Business of Home, as well as o...

Warren is an award-winning Journalist & Consultant for the home furnishing industry. He’s a regular contributor to Forbes and Business of Home, as well as others such as Home Textiles Today and The Robin Report. He’s an expert in an industry that’s currently in upheaval. Listen to this episode of Wingnut Social to hear his take

What You’ll Hear On This Episode of Wingnut Social

[0:47] Word to the wise: Vet your tradespeople
[6:41] Warren Shoulberg weighs in on the furniture industry
[7:40] How Restoration Hardware is shaking up the industry
[12:36] eCommerce must be a factor in your business
[17:28] Where does Warren think the market will trend?
[20:48] How furniture showrooms should proceed
[23:52] Darla’s love for Pier 1 may come to an abrupt end
[26:41] Do interior designers have a shot at competing?
[28:45] Why did Wayfair layoff 500+ people?
[32:36] What up Wingnut! Round
[40:19] Blooper Reel!

Connect with Warren Shoulberg

Warren on LinkedIn
Warren on Forbes
Business of Home
Warren’s Blog: StupidBusiness.com

Resources & People Mentioned

The Economist Magazine
Restoration Hardware
Ethan Allen
Pier 1
Julia Molloy Wingnut Social episode

How Restoration Hardware has taken the furniture industry by storm

Restoration hardware is a success story in the industry. Capturing interior design business is their ticket to success. They are setting the precedent for the industry. They’ve changed their business model and started closing neighborhood stores in favor of what they call ‘galleries’. These galleries are spacious showrooms—thousands upon thousands of square feet—with cafés and wine bars woven in.

They’re redefining the retail industry as we know it.

They’re becoming the envy of every furniture retailer in the industry. Warren pointed out that if Ethan Allen was on their game they would’ve been the first to embrace this concept—but they weren’t. RH is making the furniture market part of the hospitality industry. They’re still selling furniture online and leveraging both brick-and-mortar and eCommerce.

Little Designers need to factor eCommerce into their business

Online retailers like Wayfair have succeeded in undercutting the prices of most of the industry—but at what cost? It seems they are circling the drain, having recently laid off over 500 employees. Warren believes they’ve operated as if they’re Amazon, but don’t have the other income streams to offset their costs like Amazon does. There is one thing they don’t have that other retailers do: a physical location. 80% of sales are still happening in physical businesses, so it’s important to balance the equation.

You can’t ignore the internet and cut it out of your strategy like Burlington did (now they’re suffering). Pier 1 is losing many stores and will likely file bankruptcy. They both failed to stay relevant, and their future in the industry is shaky at best. You MUST find a way to incorporate eCommerce into your business model as well as traditional showrooms.

All this to say, you can’t be all things to all people. Be like Restoration Hardware and find your niche—master what sets you apart. Consumers still want to feel texture and judge color in person. There will always be a place for a physical showroom. Balance that with online offerings that espouse your unique and specific point of view, and you’ll find success. Listen to the whole episode for the in-depth discussion of the furniture industry and where it’s headed.

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