HGO Merchandiser 2015 Product Guide

Michael Knell’s

HGO merchandiser HomeGoodsOnline.ca

SPECIAL ISSUE!

ˆ 2015 ‰

Product Guide cd

CONTENTS

ˆ 2015 ‰

Product Guide cd 6

FROM THE EDITOR GETTING BACK TO BUSINESS

Consumers seem to be buying again.

What’s more, they’re interested in better quality goods made here at home and are willing to pay a little more for quality they can see. And that’s the mission of the 2015 Product Guide: to give you a little insight into what they want.

8 34

8

BEDROOM COMING BACK TO LIFE

Canadian bedroom producers, coming off a particularly tough 2014, are breathing life into the category by offering consumers new looks, styles, colours and sizes. And don’t forget upholstered headboards, which continue to help drive growth for both producers and retailers. Researched and written

by Gary James.

16 16

UPHOLSTERY KEEPING IT CLASSY: THE RISE OF CHIC UPHOLSTERY

The past few years have been gloomy for many industries, with commoditybased businesses such as furniture taking heavy hits to their bottom lines.

Now it looks like those days of racing to the bottom to tempt penny-pinching consumers are over. Thanks to changes in buyer attitudes towards quality and aesthetics, companies specialising in upholstered goods are enjoying growth, offering fun new collections and satisfying price points. Written by Ashley Newport.

22

DINING ROOM SLIM IN THE MIDDLE

Custom pieces are in, and so are smaller homes. Consumers say they want

4 HGO merchandiser

quality, but don’t seem willing to pay what it costs to get it. Savvy Canadian dining room furniture makers are aiming to find the sweet spot where quality and value meet. Our report is from Marc Barnes.

28

APPLIANCES THE PULL TO PREMIUM

Consumers have eyes for high-end style and function, and that’s where the profit lies. But economic reality means appliance retailers have to be smart about how they deliver. Andrew Brooks filed this year’s report.

34

MOTION UPHOLSTERY TAPPING INTO THE POWER OF POWER

The Canadian consumers’ love affair with cheap Asian imports appears to be ending, and this is creating new opportunities for domestic motion upholstery producers. Power mechanisms are particularly popular with consumers, and Canadian resources are happy to offer quality and value, even as the cost of materials continues to go up. Researched and written by Marc Barnes.

38

MATTRESSES MOVING AWAY FROM RECESSION

The consumer is interested in sleep technology, which explains the surging interest in adjustable beds and hybrids.

But new research also shows she’s willing to pay more than the typical retailer thinks to get what she wants. This report is from Michael J. Knell.

46

INDUSTRY CALENDAR & ADVERTISERS’ INDEX

AD Our founders always dreamed of something bigger and better.

Stearns & Foster always dreamed of something bigger and better. Few products today can claim over 165 years of history. Since 1846, Stearns & Foster has been offering discerning people the finest craftsmanship made from the very best materials available. In an increasingly disposable world, Stearns & Foster connects you to something iconic and timeless, and is made the way things should be.

Learn more at stearnsandfoster.ca ©2015 Tempur Sealy International. All rights reserved. TM Trademark 2015 to Tempur Sealy International.

HomeGoodsOnline.ca

5

EDITOR’S LETTER

Getting back to

MICHAEL J. KNELL

BUSINESS

Consumers seem to be buying again. What’s more, they’re interested in better quality goods made here at home and are willing to pay a little more for quality they can see.

A

S YOU WANDER THROUGH THE PAGES OF THE 2015 PRODUCT GUIDE,

one common theme will be found threading its way through all of this year’s categories: upholstery, motion upholstery, bedroom, dining room, mattresses and major appliances. There is an increasing demand for better quality goods. Most of the suppliers we’ve interviewed also seem cautiously optimistic that given the right circumstances, the Canadian consumer is willing to pay a little more to the get the best quality or the latest technology.

Most industry executives also point out Canadian consumers are also displaying a greater interest in goods made in Canada or, at least, made in North America. The more affluent consumer’s appetite for cheaper imported goods appears to be waning, particularly since the retail floor price for furniture made in Asia is getting higher while the quality is getting lower – which is never a good combination.

The fly in the ointment at this point is the value of the Canadian dollar. On the one hand, it makes Canadian-made furniture more competitive, particularly in the all-important U.S. market. On the other, since Canadian manufacturers have to buy components on the world market with U.S. dollars, a big part of that advantage is immediately torn away. Remaining competitive is a delicate balancing act.

It should also be noted despite what most described as sullen economic environment, 2014 was the first year big ticket commodity sales finished over the benchmarks set in 2008 when the market went sideways. For example, according to Statistics Canada’s Retail Commodity Survey sales of furniture and mattresses were valued at $8.63 billion. This was the third consecutive year of growth and the first year to exceed the $8.45 billion sold in 2008. Meanwhile, major appliance sales were $4.45 billion last year. Once again, this was the category’s third consecutive year of growth and the first to ring-up more than 2008’s $4.39 billion.

There’s reason to be optimistic. To support that optimism, there’s a wealth of new styles, designs and silhouettes waiting to be explored. We hope you enjoy the 2015 Product Guide.

HGO merchandiser 2015 PRODUCT GUIDE • VOLUME FOUR, ISSUE 2 ISSN 2291-4765

www.HomeGoodsOnline.ca PUBLISHER & EDITOR Michael J. Knell mknell@homegoodsonline.ca MARKETING DIRECTOR Corrie-Ann Knell marketing@homegoodsonline.ca MANAGING EDITOR Anthony E. Bengel tony@homegoodsonline.ca CONTRIBUTORS Marc Barnes Andrew Brooks Gary James Ashley Newman ART DIRECTOR Samantha Edwards Sam I Am Creative samiamcreative@bell.net IT DIRECTOR Jayme Cousins In House Logic websmith@inhouselogic.com PUBLISHED BY Windsor Bay Communications Inc. P.O. Box 3023, 120 Ontario Street Brighton, Ontario K0K 1H0 T: 613.475.4704 F: 613.475.0829 Michael J. Knell, Managing Partner PUBLISHERS OF

HGO This Week Home Goods Online.ca

© 2015 Windsor Bay Communications Inc. All rights reserved.

Windsor Bay Communications does not accept any responsibility or liability for any mistakes or misprints herein, regardless of whether such errors are the result of negligence, accident or any other cause whatsoever. Reproduction, in whole or in part, of this magazine is strictly forbidden without the prior written permission of the publisher.

AFFILIATE MEMBER

Michael J. Knell Publisher & Editor mknell@homegoodsonline.ca

6 HGO merchandiser

A presentation by award-winning designer and 2015 SHOW SPOKESPERSON KAREN SEALY

MORE THAN

200

OF THE GREATEST NAMES

Industry party, awards, trends, new floor plan, new exhibitors, gala, consumer day,

This show means

AND MUCH MORE!

business.

A fresh, fun and fabulous presentation by

OVER

STEVEN AND CHRIS

400,000

sq. ft. of furniture showrooms

June 4-7, 2015 The International Centre Toronto, Ontario

Canadianfurnitureshow.com HomeGoodsOnline.ca

7

BEDROOM

COMING BACK TO Canadian bedroom producers, coming off a particularly tough 2014, are breathing life into the category by offering consumers new looks, styles, colours and sizes. And don’t forget upholstered headboards, which continue to help drive growth for both producers and retailers.

BY GARY JAMES

8 HGO merchandiser

life

B

EDROOM BUSINESS IN 2014 STARTED SLOWLY

for Canadian producers due to harsh winter weather but, for most, the year ended on a more positive note – and they are taking steps to build on that momentum as 2015 unfolds.

“2014 was generally a tough year for bedroom,” said Philippe Darveau, vice president of sales for Louiseville, Quebec-based Dinec and a board member of parent company BDM Furniture.

“When the economy is soft, as it has been in many areas of Canada and the U.S., consumers postpone purchases of bedroom furniture,” he says. “If they need something new, they’re more likely to spend what little money they have available on living room or dining room, since those are the rooms that their guests see.”

Durham’s Springville collection, introduced at the October High Point Market, is an updated traditional design in maple with three stylish finish options, including the Graystone and Truffle finishes shown here.

Dinec’s Cloud collection features a bed that combines Negril-tone panel fabric with a charcoalstained wood frame.

Fabric beds on the rise

While many Canadian and U.S. retailers experienced a down year in bedroom in 2014, with sales dropping 5% to 15%, Dinec increased its business in the category by 8%, Darveau reports.

He attributes the gain to the company’s recent introduction of lower-priced beds that feature creative fabric-and-wood combinations.

“Our latest introductions are priced 30% lower than our previous bedroom products,” he says, adding, “We’ve changed the construction to make the pricing more competitive, but they still feature the style and function our customers expect from us.”

Darveau notes that while some upholstery sources have added fabric headboards to their lines lately, “not many people are mixing fabric and wood.” These new Dinec beds retail for less than $1,500.

As many consumers both north and south of the border gravitate toward condos and other more compact living spaces, smaller-scaled bedrooms also are becoming more important, Darveau says. With less space to work with, these consumers are buying fewer case pieces and looking for beds with underbed storage.

Recently, Dinec opted to drop its armoire offerings in favour of smaller, more flexible pieces such as five-drawer chests and semainiers. The company also has expanded its selection of full-sized beds to provide more options for youth and second bedroom applications.

“Many of these condos have big walk-in closets, so we’re not selling nearly as many chests and dressers as we used to,” says Darveau. “These consumers will buy a bed and two nightstands rather than a four- or five-piece group.”

In styling, Dinec has been doing well with a new wirebrush finish. Introduced about a year ago in dining, this sophisticated reclaimed look accounts for about 30% of business in that category for Dinec. At the High Point Market this past October, the company added the finish to three beds, all of which were well received, according to Darveau.

At this year’s spring High Point Market, Dinec introduced some new bedroom designs with a “light, clean style,” he says. They featured off-the-floor cases with light finishes and minimal hardware. The company also expanded its selection of vintage, reclaimed-look pieces.

Growing interest in casual

At Durham Furniture, April market introductions included a bedroom collection added to its licensed Mount Vernon line.

Inspired by George Washington’s own distillery, The Distillery collection features a wire-brushed finish and old iron nail accents. With its relaxed, traditional styling and unique finish and feel, the new collection was created by Bergelin Designs to expand Mount Vernon’s appeal with younger consumers.

Also in the spotlight at the April market was Durham’s fast-growing youth line. Durham is one of the few high- } HomeGoodsOnline.ca

9

Amisco has expanded its bedroom lineup to include metal-and-wood combinations, including this well-received industrial look.

end wood manufacturers offering a large selection of twin beds. Since the company’s Perfect Balance line features an assortment of smaller-scaled pieces, the company saw an opportunity to expand its business in the youth market early last year when several sources announced they would exit the category.

“Our Perfect Balance line includes 15 twin and double beds that are perfect for youth rooms,” says Gord Dilworth, Durham’s president and CEO. “At the October High Point Market, we geared our Perfect Balance presentation to highlight our youth capabilities and added new paint and pastel finishes to enhance appeal.”

As a result, the Durham, Ontario-based solid-wood bedroom specialist has become “the vendor of choice in youth” for several U.S. retailers,” according to Dilworth, and the Breeze, a strong seller from Amisco, features a timeless, ultra-clean design.

Design details include a bead of marine rope lining near the top of the headboard.

10 HGO merchandiser

company aims to build on that base in the coming year.

Currently, Perfect Balance – a highvalue line designed for smaller spaces – accounts for about 30% of Durham’s total business.

In the core Durham Classics bedroom line, the company also is continuing to look for new ways to serve evolving market needs. With demand for casual contemporary styles growing, the company has brought out several new collections featuring cleaner lines and a more modern look. They include two collections introduced in October: Springville, an updated traditional maple design in three finishes; and King & Main, an ash group in two finishes.

“We’re known as a traditional house but we’re steadily expanding our assortment to include more contemporary,” says Dilworth, who adds the trend toward more casual styling in bedroom builds on what’s happening with home furnishings design in general.

“The North American lifestyle is much more casual than it was 10 years ago,” he says. “Also, you are seeing a bigger influence of texture in finishes, fabrics and even hardware.”

Dilworth also believes “the desire for North Americanmade products is making a comeback.”

In the past year, Durham has introduced several new finishes that offer a more relaxed appearance to both the hand and the eye. “We’ve had great success with drier finishes in gray tones,” Dilworth says, adding these finishes work well with headboards upholstered in Belgian linens and other textured fabrics.

Regarding the outlook for bedroom in 2015, Dilworth is “very optimistic about our growth prospects.” He notes the addition of Eric Schenk – the former CEO of full-line, high-end U.S. manufacturer Century Furniture – who joined Durham as a strategic adviser in 2013, has helped the company develop new style capabilities and competitive strengths.

“Eric has encouraged us to move outside our comfort zone.

His input, combined with the talent of Bergelin Designs, is bringing a great reaction. Retailers are telling us ‘this isn’t your mother’s Durham’,” Dilworth says.

Upholstered beds spark sales

At Amisco, most of the bedroom action in 2014 was driven by fully upholstered beds, a new category for the company.

Known for its contemporary and transitionally styled metal beds, the firm introduced a range of full, queen and king-sized upholstered beds at the January 2014 Canadian Home Furnishings Market (now the Canadian Furniture Show), then expanded the selection last fall to include 39-by-80-inch single beds that can accommodate adjustable mattresses. }

HomeGoodsOnline.ca

11

Isabelle, another best-seller for BG Furniture, makes a stylish transitional statement in warm, mellow solid maple.

Typical single beds sized 39by-75 can’t accommodate these adjustables, says Guy Patenaude, vice president of sales for the L’Islet, Quebec-based metal specialist, so they’re filling a growing void.

“As the population gets older, a lot of couples are moving from shared king and queen beds to two single beds, either because of snoring, a partner who moves or health issues,” says Patenaude. “Our new upholstered beds are sized so that these adjustable sleep surfaces drop easily right inside, providing a stylish solution that’s unique to the market. As far as I know, there are not many people doing 39-by-80 in upholstered beds.”

Available in a choice of more than 60 fabrics, the new beds are available in a range of Urban and Boudoir styles. In twin size, the beds are priced at $699 to $749 retail. Full/queens run $899 to $999 while king sizes are $1,299 to $1,399.

Named after the explorer Samuel de Champlain, BG Furniture’s popular Champlain collection features simple yet elegant lines rendered in solid Ambrosia Maple.

12 HGO merchandiser

Thanks to the success of its upholstered beds, Amisco’s bedroom sales have been rising.

“Our overall business – especially in the U.S. – during the past two years is up significantly,” Patenaude reports. “Our Canadian business, over the past six months, also is up a lot.”

In 2013, Amisco’s business was flat in Canada and up “quite a bit in the U.S.,” he says. “In 2014, we were up as much as we were up in 2013 in the U.S.— an increase on top of an increase. And the Canadian side finally kicked in with increases, which was good news.”

To spark business, Amisco continually develops new product for and between major markets. In November, it showed at a one-day event held by the Les Marchands P.A.S. buying group in Quebec, bringing out a new mixed-media model in metal and distressed wood.

“This marks the first time we’ve combined metal and wood,” says Patenaude. “We expect to hit a grand slam, since this type of industrial look is very popular.”

There are other reasons for introducing product between markets. “We want to keep our sales representatives excited, and having new product to show gives them the perfect reason to get an appointment with key customers between shows,” he says.

Patenaude notes the eclectic nature of Amisco’s bedroom line provides a good match for how today’s consumers like to shop.

“Consumers have moved away from seven-piece matching bedroom suites to individual items that can be mixed and matched,” he says. “Our upholstered beds add a new dimension to rooms that blend in easily with existing cases and other pieces.”

Amisco offers a special headboard display to give retailers with limited space an easy way to show the range of options available. The display uses a ladder-like module to show three other choices along with the featured headboard.

Sights set on recovery

Solid-wood case goods specialist BG Furniture Ltd. – formerly known as Bogdon & Gross Furniture Co. Ltd. – completed a successful restructuring this past year. Founded in 1927, the company sought protection under the Bankruptcy & Insolvency Act in March 2014 after experiencing financial stress due to rising lumber prices and other cost pressures.

As part of its restructuring, BG received a significant investment by Grenville Strategic Royalty this past October, which will support its sales growth and market expansion plans, including new initiatives in the bedroom category.

“Grenville has allowed us to accelerate our growth strategy and advance the company’s services for our expanding customer base, as well as continue to innovate and bring new Canadian-made, solid-wood furniture to market,” says

Adam Hofmann, president and partner Huppé’s best-selling in BG Furniture.

Plank collection, Over the next five years, the company created by company plans to invest more than $5 million in design director Joël technological advancements and new Dupras, includes product development, says Dirk Nielsen, this stylish bed with Hofmann’s partner and BG vice presia choice of leather, dent of manufacturing. BG has added upholstery or sales representatives in Ontario and the birch planks on U.S. Northeast. the headboard.

Due to the restructuring, BG Furniture’s sales were down in 2014. Bedroom accounted for 40% of the Walkerton, Ontario-based company’s total business, a drop from the 50% share the category had been capturing on average in prior years.

Going forward, sales in bedroom and all categories at BG Furniture “should return to our 2010 peak sales levels by the end of 2015,” Hofmann says.

BG’s top sellers in bedroom for 2014 included its GrandVille collection in solid maple or weathered ash, and the Chateau Philippe, Isabelle, NUVO Champlain and Diamond Anniversary collections.

“BG Furniture is known for providing high-quality, solid-hardwood furniture with all the key features and customisation options, such as choice of finish, hardware and numerous size variations, to fit every home,” Hofmann says.

“We added concealed soft-close slides several years ago with the introduction of the GrandVille collection. This feature is now available on the majority of our bedrooms, giving the consumer a high-technology option, with the assurance of a lifetime warranty.”

For 2015, BG Furniture plans to expand its offering of weathered ash finishes, building on the success of the rustic chic GrandVille. “Initial feedback is positive and further floor placements are contemplated for 2015,” Hofmann says.

The company also will continue to expand its assortment of smaller-scaled bedroom pieces, suitable for condos and other more compact spaces. And it will roll out a traditional bedroom collection called Romanesque that was softly introduced in 2014.

Price points for the company’s bedroom line remain focused on the $6,000 to $8,000 retail range for a queen-sized bed, two nightstands, dresser and mirror.

BG will show at the June 4-7 Canadian Furniture Show in Toronto’s International Centre, where it will open a permanent showroom in the SOFA annex.

New horizons

At Huppé, the big news in bedroom in 2014 was the launch of the Kosy collection. Designed by global icon Karim Rashid, Kosy combines white oak with soft leather to deliver a fresh modern statement. The highlight piece is the bed, which features a curvaceous headboard that wraps around sleepers to envelop them in luxury.

The headboard also sports raised panels on each wing that serve as armrests and storage surfaces. The dressers and side tables feature lacquered and acid-etched glass tops that reflect the light in the room.

“The response to Kosy has been Designed by Karim great,” says Julie St-Arnaud, CEO Rashid, Huppé’s and marketing director of the Vicnew Kosy bedroom toriaville, Quebec-based manufacfeatures a leatherturer. “We created quite a buzz durwrapped bed with ing market, since people recognize unique side arms that Karim as one of the industry’s true provide a sense of design stars. Huppé is known for its sanctuary as well as clean, straight-line designs and, with a functional surface. this introduction, we’ve broadened Case pieces are in our looks to include a softer, curvier oak with acid-etched aesthetic.” glass tops.

Teaming up with Rashid also expanded Huppe’s design capabilities, St-Arnaud adds. “He encouraged us to think about design and production in some new ways, which will have a positive impact on other parts of our line.”

The new collection also attracted some retailers into the Huppé showroom that haven’t shopped the company before, she says. “Kosy is positioned at the higher end of our premium Up line. It opened doors for us with a number of new prospects.”

Based on the response, Huppé expects to bring out another Rashid-designed collection again in a year or two, mostly likely a dining set.

In the main portion of the Huppé line, the current bestselling bedroom is Plank. In birch, it features a fabric-covered, four-panel headboard design, available in a variety of leathers and fabrics. The collection was designed by Huppé design director Joël Dupras. } Continued on page 44 HomeGoodsOnline.ca

13

14 HGO merchandiser

HomeGoodsOnline.ca

15

UPHOLSTERY

KEEPING IT CLASSY:

THE RISE OF

The past few years have been gloomy for many industries, with commodity-based businesses such as furniture taking heavy hits to their bottom lines. Now it looks like those days of racing to the bottom to tempt penny-pinching consumers are over. Thanks to changes in buyer attitudes towards quality and aesthetics, companies specialising in upholstered goods are enjoying growth, offering fun new collections and satisfying price points.

BY ASHLEY NEWPORT Left: the Grant collection from Brentwood Classics is strikingly masculine with bold curves, which the company says makes it “big on style and comfort, small on space.” Available in fabric or leather, it features a kiln-dried wood frame and an eco-friendly construction, at the higher-end price points.

16 HGO merchandiser

F

OR SO MANY YEARS, THE STORY WAS

always the same: Things are tough.

And they certainly were, especially for commodities like furniture. But fortunately for upholstery producers, the Great Recession now has been neutralized by positive trends — mainly the consumer’s desire to invest in fashionable, classic pieces that are built to last and beautify a home.

Shoppers have never been more educated or style-savvy, and most are willing to spend a little extra to get a high-quality, functional couch or chair in their living rooms. That’s not to say there are no challenges ahead, but for many companies, growth recently has been steady and optimism reigns supreme.

The data supports that optimism. According to figures from Statistics Canada, upholstery shipments were up for the third consecutive year in 2014, reaching $535.1 million. This was a 2.3% gain from the $523.1 million shipped the prior year. Granted,

Middle: the North Brook group has become one of Palliser’s best sellers over the past few months, part of the “large and luxurious” trend that provides great value for the consumer.

Chic UPHOLSTERY

shipments haven’t reached the heights seen in the early 2000s, but they are moving in the right direction.

A GOOD YEAR

“2014 was so busy,” says Diana Sisto, creative director for Brentwood Classics, the Vaughan, Ontario-based stationary upholstery specialist.

“We were working six to seven days a week.

Early in the year, we decided we needed to start focusing on the U.S. Market and we got a showroom at High Point, so things were just crazy. We’re lucky we started when we did because the (Canadian) dollar started to tank, which will make us more attractive to U.S. businesses. We’re also still busy (in Canada). As for 2015, we’re very optimistic. We’ve undergone some changes and introduced leather in 2014. and it’s been outstanding.”

Growth doesn’t just happen. While the economic environment needs to be conducive,

it’s something that needs to be pursued, and it’s best achieved by staying on trend and seeking out opportunities. For many manufacturers, it’s challenging to deal with a fluctuating dollar as well as schizophrenic fuel, material and supply costs. That said, higher materials costs — often passed on to the consumer — might not be much of a problem if educated clientele decide the best materials are worth the cost. It also helps if, like Brentwood, you have U.S. dollars coming in to help you afford goods sold exclusively in greenbacks.

“Supply costs are in U.S. dollars, so having cash coming in from U.S. customers makes it easier when purchasing supplies,” says Sisto.

“Also, supply costs have gone up in terms of leathers and fabrics. A majority of fabrics come from U.S. Mills, and some Italian goods are sold in U.S. dollars as well.”

But what about increased costs across the board? Are they hurting business or scaring }

Right: the Antionette settee is the latest addition to the Kimberley Seldon by Brentwood Classics collection.

Dramatically luxurious, this settee is sure to liven up whichever room the customer resides in. It’s perfect for a romantic loveseat or a dramatic dining banquette as its spectacular back and wings give this settee an extraordinary amount of flair. Shown here in Nubia Fuchsia fabric.

HomeGoodsOnline.ca

17

Superstyle’s LeatherBrand product line, including the Model L787 seen here, finished 2014 with double-digit increases in shipments.

The Model 2476 from Décor-Rest is part of the new Flirt collection launching at the April market in High Point.

The collection features sexy frames designed to wear a skirt or show a little leg.

“Our industry underestimates the consumer.

If you offer something better, she might want to take it. A customer wants an amazing piece. People are happier with a better product that lasts longer.”

18 HGO merchandiser

consumers? According to Sisto and others throughout the industry, people are far less afraid of pricier goods than they once might have been.

“Our industry underestimates the consumer,” Sisto says. “If you offer something better, she might want to take it. A customer wants an amazing piece. People are happier with a better product that lasts longer. Nicer fabric and construction is worth it if the consumer is already invested in that look. It’s more about convincing sales reps and retailers that a woman would buy what she wants if she loves it.”

Superstyle Furniture, the Woodbridge, Ontario-based upholstery maker, also had a strong 2014 and is excited about an equally robust 2015.

“Overall, our business was up in 2014,” says Laine Reynolds, vice president of sales for Superstyle, which also makes contemporary goods under the Trend-Line label, and sofabeds under the Simmons Upholstery Canada name.

“The most positive aspect of this was our increase in the independent sector, which has experienced solid growth over the past few years.

Additionally, our LeatherBrand product line finished with a high double-digit increase. Both of these areas were given intense focus last year.

“For 2015, we plan to maintain this focus,” he continues. “This strategy, combined with the positive effect of the strong ‘Buy Canadian’ sentiment and the low Canadian dollar, should continue to outperform the marketplace.”

Growth also was on the upswing for Calgarybased Dynasty Furniture. Its founder, Zaher “Jim” Sunderji, was selected by the Canadian Home Furnishings Alliance as its 2015 Lifetime Achievement Award honouree.

“Business last year was excellent,” says Karina Sunderji, company vice president and daughter-in-law of the founder. “We saw the return of independent domestic business. We

saw the return to Canadian-made goods. We think the U.S. dollar has an impact on the push to buy Canadian, where there’s no volatility with fluctuation. There’s a focus on Canadian quality and the Canadian market and economy, which helps the country.”

Palliser Furniture, probably Canada’s largest upholstery manufacturer with factories in Winnipeg and Saltillo, Mexico, also had a great year.

“We just completed our fifth year of sales growth,” reports Lorri Kelly, executive vice president of sales and marketing. “Our first quarter of 2015 was phenomenal and it’s continuing on the same sales trend. We anticipate 2016 will be terrific.”

WHAT SOLD?

Upholstery has the ability to truly add to a room. With Houzz and Pinterest drawing so much attention to the home and the importance of style, manufacturers have the opportunity to get creative while still keeping traditional shoppers satisfied with old faithfuls.

“Last year our success stories were many; starting with Vogue, which has become a highly regarded brand extension to the regular Superstyle line,” says Superstyle’s Reynolds.

“Vogue is a collection of casual, timeless designs which offer deliberate luxury within reach of a broad audience. LeatherBrand continues to grow.

It represents the best-value, most-comprehensive leather line in its class. Trend-Line launched Studio-Line to a welcoming market. This collection includes backless studio sofas in the emerging mid-century style category.”

Speaking of style, a lot of industry insiders noticed a return to classic looks, albeit more modern, streamlined ones. }

Canada’s product protection company.

Let us show you a new way to protect your customers and your margins.

Visit us at the Canadian Furniture Show Hall 2 – Booth 2484 To learn more: www.zucora.com HomeGoodsOnline.ca 19

The Florence sofa, a best seller for Van Gogh Designs, is another example of a midcentury modern design that is very popular among consumers.

“We’ve seen a lot of classics trending,” says Dynasty’s Sunderji. “Transitional, contemporary, timeless pieces for people in their 20s, 30s, 40s and older – there’s been a real strong push with fabrics, and Canadians want comfort and softness. The styling they want is clean, classic, timeless and uncomplicated.

They tend to like button tufting and pieces with a sophisticated look.”

She also notes that in terms of colour, tastes are, as usual, evolving.

“People are moving away from (focusing exclusively) on style. It’s about the overall energy of the piece, so colours are fairly exotic and almost artistic. There are bold and serene colours like aqua and teal that are soothing but

Sharing their best-sellers What types of pieces are flying off showrooms floors?

These companies reveal their most on-trend pieces.

Brentwood Classics: Sectionals and larger pieces in the $2,000 to

$3,000 retail price range with “$10,000-looks” did well in 2014 and are holding on this year.

Dynasty: Pieces with a more classic, transitional, contemporary look.

Décor-Rest: Pieces from the Living Large in a Small Space collection

continue to be a hit with the urban/suburban and rural crowds. Pieces in the $1,000 range remain strong sellers as well.

Van Gogh Designs: “Our best-sellers were the Florence sofa, Vincent sofa, and the Chelsea upholstered bed,” says Sam Kanga, national sales manager. “The Florence sofa is popular for its mid-century modern design, which is very popular in general at the moment. The Vincent is a contemporary piece that appeals to a wide segment of the market. Our Chelsea bed, with its luxurious deep tufting, has been extremely popular across the country.”

Palliser: The Barbara, Miami and North Brook sofas, which range from compact to large and luxurious, are performing well for the company, which targets the middle to higher-end price points at retail.

Superstyle: Vogue is a collection of casual, timeless designs that

offer “luxury within reach of a broad audience,” says VP of Sales Laine Reynolds. Other popular items include those in the LeatherBrand category and Trend-Line’s Studio-Line, a collection that includes backless studio sofas in the much-talked-about mid-century look.

20 HGO merchandiser

bold. There’s also a huge push in blues, which evolved from a shift of brown to grey. Greys are getting lighter and brighter, more airy and fun. Other big colours are navy, turquoise and aquamarine. There’s been a departure from matchy-matchy, and people are embracing floral, geometric and earthy accents. People see creativity and artistry and harmony in contrasting tones.”

The push towards smaller-scale furniture, mainly due to the shrinking size of living spaces, also continues for some manufacturers.

“There’s been a push in the condo living market that started about a year ago,” says Angelo “JR” Marzilli, executive vice president of Décor-Rest Furniture, also based in Woodbridge. “We came up with designs to fill the void and we launched a collection – Living Large in a Small Space – at High Point last October. We went to market with that slogan and people bought buy into it. Even people who live out in the country want urban rooms.”

Marzilli sees a return to elegance on the horizon in 2015, with skirts for couches re-emerging as must-haves for style-savvy consumers. “In April, we’re debuting our Flirt line at High Point, which will feature sexy frames designed to wear a skirt or show a little leg. Gorgeous either way,” he says.

On the other hand, while classic elegance seems to be trending across the board, Brentwood’s Sisto is seeing a return to big pieces rather than compact ones.

“Sectionals are huge, and we’re seeing that frames with lots of SKU options have been very big,” she says. “We’re also seeing a lot of 42-inch, deep-set, large furniture. Our number one sellers have bigger frames. In terms of aesthetics, the looks are classic, traditional designs with features like the Belgian shape arm and button-tufted chesterfield. We’re seeing pieces with updated, old-world looks – clean, simple and classic silhouettes.”

Like Dynasty’s Sunderji, Sisto says that while basic frames are typically traditional, people are starting to have more fun with fabrics. “We used to see a lot of linen, and now we’re seeing textures coming into the market such as chenilles, velvets and anything that’s plush with a more luxurious look to it. They’re classic and they’re so comfortable, and people are willing to spend money on something that’s really comfortable.”

Others, like Van Gogh Designs, are seeing a greater embrace of style in general, with midcentury looks gaining ground.

“What’s hot right now? Spaces that are organic, moody, warm and luxurious yet minimalistic,” says Kam Sangha, national sales manager for the Surrey, British Columbia-based producer. } Continued on page 45

Las Vegas Market

BIGGER. BETTER. BEYOND EXPECTATIONS. Furniture | Home Décor | Gift

August 2 - 6, 2015 CELEBRATING 10 YEARS

NEW SHOWROOMS ON EVERY FLOOR 2,200 CROSS CATEGORY LINES & GROWING NEW FLOORS • Gourmet, Gift & Housewares on C11 • Boutique décor and accessories on C5 • Casual Furniture & Patio on C12-13 NEW TEMPORARY TRADESHOW: THE PAVILIONS AT LVMKT • Design, Handmade, Gift & Home • Introducing Discoveries: The Antique Vintage Marketplace

AUGUST 2-6, 2015 REGISTER FOR MARKET TODAY!

LasVegasMarket.com/Register

DINING ROOM

Top left: Designed by Blake Tovin for West Brothers, the Fulton dining room merges hand-crafted details such as natural leather drawer pulls and textured wood planking with crisp lines to highlight the importance of craft in contemporary designs. Made from white oak it is seen here in West’s sand finish.

Top right: Produced by the Dinec division of Groupe Bermex, the Jean dining group features its new wire brush finish table and chairs – which the company’s believes enhances the timeless beauty of solid birch wood.

Bottom: Carla, another dining group from the Dinec division of Groupe Bermex, also features its new wire brush finish which helps even the most contemporary furniture look vintage-chic.

Opposite page: The Phase dining collection is by far West Brothers’ most popular dining room.

22 HGO merchandiser

Custom pieces are in, and so are smaller homes. Consumers say they want quality, but don’t seem willing to pay what it costs to get it. Savvy Canadian dining room furniture makers are aiming to find the sweet spot where quality and value meet.

BY MARC BARNES

SLIM IN THE MIDDLE

D

of challenges this year, including an uncertain economy and consumers who want quality and custom pieces but seem reluctant to bear the cost.

According to what manufacturers are hearing from their retailers, consumers are searching for bargains, but also want beautiful dining rooms with high-quality upholstery and finishes. They’re in favour of upholstered dining chairs but not when they have arms. They want furniture that’s modern but also rustic. They want furniture that’s either high-end or promotional – apparently with little middle ground.

If you had to describe the relationship between today’s consumers and those who make and sell dining room furniture, you’d have to say, “It’s complicated.”

Of course, daily life has changed. The dining room used to be a place where you rarely went, except for a holiday meal.

Today’s homes are smaller, and a dining room table may mean different things on different days. It may be the sitdown place for a formal dinner, or a more casual pizza night, or a workbench covered with plastic sheeting where a student builds his science project. It might be a classroom space for an online course taken on a laptop, or it might be the top of an executive desk for a home office.

Industry insiders say savvy producers must bring to market new designs to fit a variety of uses.

as opposed to larger online retailers which tend to go for trendier imports, where quality is not as much of a factor.

“We watch the trends, but we know that trends come and go. Lasting quality and style are something that truly stands the test of time,” Mund says.

She said it’s too soon to tell how much the weakening Canadian dollar will affect prices, although it has boosted sales in the United States, where West Brothers has an increasing presence. The Hanover, Ontario-based case goods resource continues to streamline manufacturing to help minimize future price increases.

“As far as price points, we see the middle to higher-end contemporary/transitional segment as our market,” says Mund. “Currently, we are forecasting careful growth for 2015. It’s been a steady climb since 2013, but certainly it’s a very different economic climate than it was six years ago.

We are already experiencing an upswing. We have new customers and our brand is really growing.”

Crucial to that growth has been the Phase collection, a consistent performer. Fulton, the company’s newest introduction, has a contemporary design which sells as soon as it’s on a retailer’s floor, she says. Both were created by Blake Tovin, the well-known American furniture designer.

West Brothers will continue to build on its web site and showed a new fabric program at the spring High Point Market, Mund says.

West Brothers: Looking to pass time’s test

Bermex: What do customers want?

INING PRODUCERS ARE FACING A NUMBER

Samantha Mund, customer service and marketing manager for West Brothers Furniture, says it’s because of those factors – plus the consumers’ increasing use of the Internet to research what will meet their needs – that successful retailers must keep up with the latest product offerings from manufacturers.

She believes independent brick-and-mortar stores can be more successful by carrying a deeper offering of products,

At Groupe Bermex, Denis Darveau, vice president of sales, says retailers are telling the company “that people are willing to spend less and less on furniture. They want quality and beautiful furniture, but they don’t want to pay the price.

Most store chains are downgrading instead of upgrading, and most want a better price point. It’s tough for us being in the middle to higher price points, with good quality furniture with thousands of choices.” } HomeGoodsOnline.ca

23

AD

The Best Buy Seal and other licensed materials are registered certification marks and trademarks of Consumers Digest Communications, LLC, used under license. For award information, visit ConsumersDigest.com

PSLBRO2015 1.1.15 ©2014 Serta, Inc.

5 reasons to never cou It's time to put your sleep problems to rest.

Sleepless nights spent tossing and turning, sleeping too hot or cold or not having enough support, can lead to exhausted mornings. We all know the feeling. But sleeping on the right mattress can help alleviate these problems and make you remember what it feels like to be rested. The right mattress really does matter when it comes to getting a good night's sleep.

Introducing the latest Serta Perfect Sleeper mattress.

Engineered with input from the National Sleep Foundation to help solve 5 common sleep problems.*

*5 common problems experienced when sleeping on a mattress.

24 HGO merchandiser

AD

So Comfortable, You'll Never Count These Guys Again.™

www.sertacanada.com

The Best Buy Seal and other licensed materials are registered certification marks and trademarks of Consumers Digest Communications, LLC, used under license. For award information, visit ConsumersDigest.com

P

unt sheep again.

Helps reduce tossing and turning

Encourages proper back support & alignment

Promotes a balanced sleep temperature

ComfortRight™ Layers

Custom Support® System

CoolBalance® Technology

This advanced system of foams and

Every Perfect Sleeper features a system of durable, yet flexible carbon steel coils that work to promote proper support and alignment across the entire body.

A unique combination of high-performance heat and moisture-regulating fabric and an overall mattress design that helps promote airflow. Together, these help provide a comfortable, balanced sleep temperature.

Minimize impact from partner movement

Resists sagging

TrueSense® Design

ComfortLast® Construction

Serta's exclusive design helps minimize the impact of partner movements, working to isolate motion at its source so you can enjoy a peaceful night's sleep with fewer disruptions.

Designed to enhance durability of the mattress and is thoroughly tested beyond industry standards to make sure it can

instant comfort. This helps reduce the pressure points that can cause tossing and turning, so you can sleep more comfortably through the night.

enhanced durability can help extend the comfort life of your mattress.

HomeGoodsOnline.ca

25

He notes the idea of mixing old and new design motifs in an eclectic look are still popular and in demand. Accordingly, the Louiseville, Quebec-headquartered Bermex plans to bring to market 75 new SKUs featuring new wire brushed finishes and new transitional looks in fabrics.

Darveau says a big, and somewhat unusual, demand has been for upholstered chairs, which in turn has led the company to add 19 such chairs over the past two years. Today’s consumer is putting side chairs at both ends as well as both sides of the table, he says, instead of putting armchairs on each end.

Like most dining producers, Bermex is riding out the economy. “We are looking to come out with new stuff that will set us apart from the competition, especially the Chinese,” Darveau says. “The things they can’t do is what we have to be good at.”

The slide in the Canadian dollar means new prices will be coming out in May or June, although he admits raising prices comes with some risk. “The last thing you want to do is change the prices and have the dollar strenghten,” Darveau says. Bermex hopes to balance any price increases with enhanced incentives, such as better pricing on floor samples, more generous discounts on invoices, or heightened sales, marketing and advertising allowances.

Darveau notes 2014 was the first year in the past five where Bermex enjoyed solid sales growth in the United States. Since the recession, growth has been either stagnant or worse. The weak Canadian dollar could result in more U.S. sales gains, he says.

Like West Brothers, Groupe Bermex isn’t on the exhibitor’s list for this June’s Canadian Furniture Show in Toronto.

Woodworks: Opposites attract

At Woodworks Solid Wood Furniture, National Sales Manager Derrik Middleton says both contemporary and rustic looks are gaining traction. “That’s where our focus is going to be,” he says. “We’ll be developing both new contemporary styles and some rustic styles as well.”

Contemporary and rustic are selling especially well in the Vancouver, Calgary and Toronto markets, Middleton says, which he attributes to ongoing efforts to transform urban factories and warehouses into loft apartments.

Like others in dining, he reports consumers are rejecting dining chairs with arms.

Woodworks, located in Surrey, British Columbia, is looking to hold the line on pricing, given that it had a large increase last year, the first in about four years. Middleton says prices for hardrock maple and oak, for example, have gone up significantly in the past 18 months.

Also affecting the company was 66,000 oil-industry-related job layoffs in Alberta, a huge part of Woodworks’ market.

“The last quarter of 2014, we were moving forward with sales increases and we were quite optimistic for 2015, but then the Canadian dollar and the price of oil went down and it slowed our economy – more so in western Canada than in central Canada,” Middleton says. “We are thinking that 2015 is not going to be as good as 2014 at this point.”

To meet the immediate challenges, Woodworks is look-

26 HGO merchandiser

Canadel will be revamping will be revamping its popular and heavily distressed Champlain collection, seen here, with the introduction of five new chairs, new tables and case pieces.

ing to roll out a couple of new lines outside of dining that are more price-point oriented. It’s also considering getting back into the U.S. market, which it left for economic reasons a number of years ago. But for now, marketing efforts will center on the Canadian Furniture Show, he says.

Camlen: Looking for the cheap and cheerful

For Camlen Furniture, the market has been trending either toward the high or low end, with nothing left in the middle, says Greg Brown, vice president of the family owned producer.

“People are after cheap-and-cheerful or super-custom,” he notes. “People don’t want to spend, or they have so much to spend that they want it down to the smallest detail.

There’s been no middle ground in my recent experience.”

Brown doesn’t think the weakening Canadian dollar will change the way he prices and doesn’t see any dramatic increases on the horizon, although he expects some small increases in the costs of materials.

For Camlen, 2014 was mediocre, he says, and 2015 may be slightly better than mediocre. “I don’t want to look like too much of an optimist, but I am realistic. I am a positive person, but the independent retailers are gone.”

Since Camlen first exhibited at was then The Canadian Home Furnishings Market in 2000, Brown has witnessed an erosion in the number of stores and people turning out to buy every year. “Now that’s virtually done,” he says. “The ones we had are closed and there is nobody taking their place. In 2014, Ontario and Quebec were like they were in the worst year of the recession – worse than any other year.

Sales were just abysmal.”

Top: This dining table from Camlen Furniture features the Quebec producer’s zinc top table with its Royal fan back chairs, both of which are made in birch.

Bottom: Canadel’s Loft collection sports a modernised industrial design well suited to condos and other smaller living spaces.

These days, Brown describes Camlen as half manufacturer, half custom-builder. Sales are down on the manufacturer side, but not with custom projects, which are attractive to the well-heeled consumer. “People who have money are not afraid to spend it,” he says. “Unfortunately, there is a limited supply of them.”

The Knowlton, Quebec-based company didn’t know at press time if it will participate in this year’s Canadian Furniture Show.

Canadel: Solving the mystery

At casual dining powerhouse Canadel, the mystery of what customers want is pretty clear.

“We believe consumers, as well as the better retailers, are looking for quality furniture they can custom design to make it their own in a sea of look-alike imports,” says M. Denis Charest, Canadian sales manager.

In terms of pricing, he doesn’t see the weak Canadian dollar making much difference, given they produce most of their furniture at their home base in Louiseville, Quebec with relatively few components purchased in U.S. currency. He believes prices could go up sharply on some imports, with Canadian-made furniture looking good by comparison.

Charest says Canadel is doing well throughout North America with offerings such as the heavily distressed Champlain collection and the more industrial looking Loft group. The company’s introductions this year will focus on contemporary styles scaled down for condos and smaller spaces while offered custom design possibilities.

More specifically, Canadel will be revamping Champlain with five new chairs, new tables and case pieces in the heavily distressed look. “Ours being fully customizable will definitely set us apart,” Charest says.

Canadel will participate in the Canadian Furniture Show.

It also exhibits in High Point and Las Vegas.

BG: Embracing personalised quality

Adam Hofmann, president of BG Furniture, says the company is focusing on those consumers who have embraced better-quality furniture that can be personalised.

“Many consumers are still challenged by the last recession and have less disposable income, so when our target consumer does make a decision to buy furniture at one of our retailers, they are still cautious and spend significantly more time shopping between stores and research online,” he says.

BG faces increasing lumber and other material costs, driven by the surging U.S. Dollar, but since half its costs aren’t affected by those factors, price hikes will be minimal in comparison to what retailers will see from U.S. and Asian manufacturers, Hofmann says.

“Our competitiveness will continue to improve, as should most Canadian furniture manufacturers, as the economy re-balances with hopefully a lower reliance on the energy sector,” he says.

Costs for both U.S. and Asian furniture have gone up 25% in the last six months, Hofmann says, with Asia-made furniture going up 10% to 15% each year as their wages and costs increased faster than those in Canada. BG raised prices 3% to 5% last April.

He says sales were down in 2014 due to the company’s restructuring, but he’s expecting substantial recovery this year as BG re-enters the U.S. market and gains market share from U.S. and Asian suppliers.

Citing the trend toward smaller living spaces, Hofmann says BG’s future offerings will include smaller-scale product and some new contemporary styles. But for the upcoming Canadian Furniture Show, the Walkerton, Ontario-based manufacturer will strengthen its traditional category with a new mid-century style collection. BG is opening a new permanent showroom in the International Centre’s SOFA annex.

All in all, Hofmann is optimistic and says Canadian retailers have reason to be so as well. “The spread between furniture made in Asia and Canada is narrowing,” he says.

“When consumers are shown that they only need to spend 20% or 30% more for better-quality, longer-lasting Canadian-made furniture, more and more Canadians are going to choose a domestic product.” HGO A regular contributor to Home Goods Online, MARC BARNES is a High Point, North Carolina-based freelance writer with considerable experience in the furniture industry.

HomeGoodsOnline.ca

27

APPLIANCES

The pull to premium Consumers have eyes for high-end style and function, and that’s where the profit lies.

But economic reality means appliance retailers have to be smart about how they deliver.

ANDREW BROOKS

Consumers are demanding consistency and integration from both a design and interface perspective when it comes to their higher-end kitchen appliances. The new 48-inch range from Miele Canada, seen here, offers the same user interface as found on its other kitchen products.

28 HGO merchandiser

T

HE HIGH END IS STILL WHERE THE ACTION IS. THAT’S THE

consensus of industry insiders Home Goods Online spoke to for our 2015 overview of the major appliance category.

But this year is seeing an upsurge in the aspirational consumer – someone who responds positively to design and operational innovation but wants a way to accommodate high-end looks and functions to constrained budgets and average-sized home spaces.

Add the weak Canadian dollar to the mix and the sweet spot for major appliances is, as always, a moving target.

Looks definitely matter. Stainless steel finishes are still on a roll, but now manufacturers are trying to anticipate what will follow, says Philippe Meyersohn, general manager of marketing and training for GE Appliances/Mabe Canada. “This still hasn’t been completely figured out.

The consumer’s interested, but is also quite conservative.”

In the category where colour has been strongest – laundry – red finishes have had an impact, but other than that, tastes didn’t stray far from grey, white, red and occasionally blue, he says.

GE’s own slate finish has had a good reception. “We started with slate in a very targeted way, and we’ve been expanding it steadily, to the point that it’s in the number two position,” Meyersohn says. One consumer benefit is slate matches well with other finishes, an important

consideration in a tough market where fewer consumers are in a position to replace more than one appliance at a time.

“Stainless is far and away the leader in almost all market categories,” says Michael Vancura, executive vice president of retail operations for Mega Group. “Black is still there, though a bit more marginal, and there have been some introductions of stainless steel combinations with black.”

Aleksandra Stratton, senior marketing manager for KitchenAid and Jenn-Air in Canada, says colour options are getting more popular. KitchenAid has responded with a variety of finishes including black stainless steel. This is an industry first, Stratton says, offering “a satiny lustre, paired with a modern sleekness that makes its own style statement.”

Jenn-Air has also recently introduced the Obsidian interior refrigerator – a black interior with LED illumination.

Corey McMullan, director of appliances for Cantrex Nationwide, says chrome accents are reappearing after an absence of some two decades. When it comes to features and functionality, he lists the continued strength of French-door refrigerators, counter depth refrigerators, high-efficiency washing machines and steam technology in the laundry category – “but they don’t know why they want it,” he adds.

“A definite trend we’re seeing is consistency and integration from both a design and interface perspective,” says Kelly Lam, vice president of marketing at Miele Canada, adding consumers want a consistent look in their kitchen. “They’re looking for a brand that can provide a consistent look amongst all of the appliances they offer.” This need for consistency also applies to the user interfaces, “so whether they’re using their oven, microwave, or steam oven, interaction with each machine is the same.”

Mega’s Vancura says induction technology on ranges is a trend that is now finding mass appeal, while built-in ovens and cooktops are also gaining traction. “On the laundry side,” he says, “manufacturers have done a good job of bringing efficiency, technology and looks to the laundry room. There are some colour stories with greys and silvers augmenting the whites.” Top-load is making a comeback now that high-efficiency models are available. Non high-efficiency top-load is exiting the market for good.

Lam notes connectivity between appliances is increasingly a reality. He points to Miele’s own introduction this past January of Conn@

ctivity 2.0, which links the ventilation hood fan to the induction cooktop. “When a consumer turns on their induction cooktop, the ventilation hood will automatically turn on with the appropriate power setting, based on the cooktop function,” he explains. “The amount of heat being generated from the cooktop determines the hood fan power setting, so consumers don’t need to worry about remembering to turn on their vent hood.”

One of the big buzzwords at the 2015 Consumer Electronics Show this past January was the “connected home,” says Katrina Dominic, marketing brand manager for home appliances at LG Electronics Canada, noting that one way they have addressed the trend is through ‘LG NFC Tag On’, which uses nearfield communication to connect a smartphone to a washer and extends laundry options beyond the traditional cycles, allowing some laundry items normally reserved for the dry cleaner to be cleaned at home.

“With a simple tap, connect to the LG Smart Laundry app, which will let you easily change and customize your laundry cycle, ensuring the best care for even your most hard-to-launder clothes,” Dominic says.

THE ASPIRATIONAL ANGLE

Michael Vancura singles out the “mass premium” segment as worth watching. As premium features migrate into lower-priced segments, consumers with premium lifestyle aspirations but without the space or financial

Left: the new counter depth version of the T9000 refrigerator from Samsung Canada offers a slim design that easily fits into standard kitchen cabinets, so it delivers a more harmonized look and feel for today’s modern kitchens. It also features Triple Cooling System technology, which creates three separate airflows in the refrigerator and freezer, enabling optimal humidity and individual temperature control for each compartment.

Right: the Samsung Flex Duo range gives consumers the ability to simultaneously cook two different dishes in two separate compartments at different temperatures with little transfer of aroma and taste, all behind the streamlined look of one solid oven door.

HomeGoodsOnline.ca

29

While stainless steel finishes are still strong, the consumer’s colour palette remains very conservative when it comes to the kitchen. White remains a leading choice, as seen in this kitchen featuring the GE Artistry collection.

Top left: Instructions and identifiers in braille is one of the options being offered to consumers buying the Artistry series of major appliances from GE/Mabe Canada.

Bottom left: Multifunction is another key consumer demand. For example, in the GE Café Keurig series, the refrigerator not only dispenses cold water but has a built-in coffee maker.

30 HGO merchandiser

resources are focusing on accommodating high-end styling and feature sets to average budgets and smaller spaces.

“A lot of what was at the top end a couple years ago is being ‘right-sized’,” Vancura says.

“Not everyone has a 2,000 square-foot kitchen.

The space requirements of the typical home restrict what you can fit in.” In fridges, this aspirational demographic favours larger units as much as possible, but has drilled down on added functionality and style flourishes.

“They’re opting for French-door refrig­ erators,” Vancura says. “LED lighting has become the norm, and high-efficiency operation is also an expectation. They’re going for slide-in ranges a lot more, as well as built-in cooktops and ovens.” Induction cooking, once confined to the premium segment, is now available at almost all price points, Vancura points out.

The weak Canadian dollar is definitely having a strong impact on the industry, compounded by the absence of Canadian manufacturing capacity and the fact units are priced in U.S. dollars. But there are positive signs too.

“I think sales for the industry will be relatively the same as last year,” says Warner Doell, Samsung Canada’s vice president of sales and marketing for home appliances.

“I believe there’s been a bit of a shock to the consumer on the Canadian dollar depreciation.

However, the housing market remains stable.

There’s appreciation on homes. Interest and mortgages rates have come down slightly.

Those economic indicators are good.”

“We think appliance sales for the inde­ pendents will be up again this year,” Vancura says. “The first few months of 2015 have borne that out, and we’re looking for 2% to 3% growth for the year. If unit sales stay the same, then just by the inflationary pressure of the change in the dollar there’s going to be a significant dollar increase in sales.”

Steve Preiner, director of marketing for BSH Home Appliances Canada, says 2015 has started well and he expects that trend to continue. Low interest rates are driving volume in the industry, new housing demand is generating builder business, and the resale market is igniting renovation demand. Even

the entertainment media are playing a part.

“All the reality shows that deal with renovating and upgrading your home generate sales volume from consumers who see it on TV and realize they can do the same and add value to their homes that will pay back,” Vancura says.

McMullan of Cantrex Nationwide notes appliance prices haven’t followed inflation, as a top-load washer at Sears was selling for $499 in 1975 – the same price it sells for today.

What’s exploded, he explains, is the high-end and premium market. “Customers pay for style, features and benefits, and ease of use,” he says, also noting that while major vendors are now enforcing minimum advertised price policies to stem price erosion, “loopholes that larger retailers can take advantage of online can add even more competitive pressure for the smallto medium-sized independent.”

Meanwhile, Mega’s Vancura says the emerging mass premium market requires a relatively high degree of customer touch. “The independents have more time to spend with the consumer.

Typically, their sales reps on the floor are better trained, because they have more time to develop product knowledge. Higher-end technology and better looks – that’s where the independents should be focusing their effort. The independents are better able to tell style and technology stories than the big-box stores.”

McMullan advises independent retailers to highlight dominant trends, including French-

door fridges and the popular stainless steel finish (although they shouldn’t neglect other finishes). A selection of built-in cooking should be on display, induction cooking will do well if supported by live demos, and key new product introductions, such as “double oven ranges, steam-enabled appliances, and door-in-door” have to be part of the mix.

In a tough market, says Mabe’s Meyersohn, too many people – consumers and retailers alike – are focused on getting prices as low as possible. “The role of the retailer in a tough market is to make sure they communicate the difference between products, so the consumer is satisfied they’re getting the best value,” he says.

“It has to make sense for the consumer. But you have to educate the consumer; otherwise they just go for the cheapest.”

Independent retailers should leverage their market advantage by focusing on the higher end of the market, says Preiner of BSH Home Appliances. “Competing in the mass category usually leads to ugly price wars. With new technologies, there’s a value-add that justifies the price, so there’s less need to discount. In fact, giving away margin in a product with a unique feature set and differentiated technology is a waste of profitability.”

Convenience and high performance are key themes, says KitchenAid’s Stratton. “Consumers are looking for appliances that make their lives easier and more enjoyable, and this is something retailers should keep in mind when }

The ‘connected home’ is the underlying technology and merchandising message from LG Canada. A number of their new premium refrigerators boast its door-in-door feature, as seen in the kitchen below.

HomeGoodsOnline.ca

31

In 2014, the Bosch division of BSH Home Appliances unveiled a completely redesigned line of kitchen goods, including cooking, refrigeration and ventilation. The revamped 800 series is seen here in a showroom kitchen that was set up in Chicago.

MAJOR APPLIANCES AT CFS In an effort to revitalise the event, the organisers of what is now called the Canadian Furniture Show have shifted it from its familiar time slot during the harsh winter winds of January to a more promising threeday spring happening – June 4 to 7, 2015. It will conclude with the return of Consumer Day on the closing Sunday.

The event remains at Toronto’s International Centre, near Pearson International Airport, and it expects to host some 190 or so participants, who will exhibit major categories from upholstery, case goods and mattresses to major appliances.

Mega Group and Cantrex Nationwide are expected to have a significant presence on the show floor. Both also will have member meetings and private product presentations at outside hotels down the road on what’s usually referred to as the Airport Strip. Both group’s product displays are expected to feature extensive major appliance presentations.

Mega’s market effort also will include the annual general meeting of its 204 independent retail shareholders.

Cantrex will be headquartered at the International Plaza Hotel, while Mega will make its home at the Sheraton Toronto Airport Hotel.

One of the key goals for this year’s

32 HGO merchandiser

Canadian Furniture Show was an expansion of its major appliance presence.

BSH Home Appliances Canada will attend for the first time, showing Bosch and Thermidor brand kitchen vignettes with live cooking demos in space 2503, located in Hall 2 of the International Centre.

Electrolux Canada will be located in Hall 5, space 5235, while its floor care division will be one aisle over in space 5351.

Fisher & Paykel, Aga Marvel and distributor Distinctive Appliances all have permanent showrooms in the International Centre’s SOFA annex.

They can be found in spaces 207, 205 and 206, respectively.

Although, the company has exhibited in prior years – including 2014 – it wasn’t known at press time if Whirlpool Canada (including its Jenn-Air and KitchenAid brands) would be exhibiting.

GE/Mabe also was undecided, although the recent opening of its new Toronto Design Centre may preclude it from exhibiting.

Samsung Canada won’t be exhibiting at CFS, saying it hosts its Canadian retail network at the Consumer Electronics Show in Las Vegas each January.

LG Electronics Canada and Miele Canada won’t be exhibiting at CFS this year.

staging their floors.” As one example of new features, Stratton notes four of KitchenAid’s new dishwasher models feature a “nine-inone” dynamic wash arm that maximizes wash coverage inside the washer.

A study Meyersohn conducted a few years ago showed that a very small percentage of people visiting a store will specify a specific model. Most will have a short list of a few.

“They do their research online and form their opinions there,” he says. And when they arrive, they’ll want to “go deep” on their short list, testing the knowledge of the sales staff.

The online channels are still primarily used for the research and price comparison phase of the shopping experience, McMullan maintains.

“Bricks and mortar is where over 90% of appliance purchases are still made. (But) online marketing is essential to competing in today’s market, and customers are better informed and better armed for negotiation than ever before.”

Miele’s Lam emphasizes that the online space plays a big part in the purchase decision.

“Their first point of reference is researching and reviewing products on the Internet,” he says. “The key is to bridge the gap and make the online and brick-and-mortar experience seamless and integrated. In the online space, consumers can shop how they want and when they want in a pressure-free environment, which is preferential for the consumer.”

Samsung’s Doell says he sees major regional retailers investing heavily in their web sites to make them shopper-friendly and to add transaction capabilities. And while the appliance consumer still wants to come in and kick the tires, Doell says his retailer customers are finding that once the decision has been made, instead of going back to the store to finalise the purchase, more and more consumers prefer to pull the trigger at home on the retailer’s web site.

“With independents, it’s very important to position themselves as the place where you have informed salespeople and a live display with a premium look and feel,” Doell says.

“They need to show the innovation, show that they’re leaders. This will help them compete and win in the marketplace.” HGO ANDREW BROOKS, a freelance writer based in

Oakville, Ontario, is a regular contributor to Home Goods Online.

HomeGoodsOnline.ca

33

MOTION UPHOLSTERY

Tapping into the

POWER

of power

M

OTION FURNITURE PRODUCERS SAY THEY

are seeing rebounding sales for several reasons, not the least of which is they have a product many consumers want. Those consumers have grown weary of talk about a weak post-recession economy, and many have noted that imports are going up in price and down in quality. It’s enough to make them want a comfy chair or sofa where they can sit down, push a button, and have a motor put up their feet.

Lorri Kelley, executive vice president of sales for Palliser Furniture – probably the largest Canadian upholstery maker – says retailers are beginning to understand the power of, well, power in the motion category.

“Most consumers don’t know what power motion is,” Kelley says. “It’s a whole new opportunity for manufacturers and retailers that we’ve not really tapped into yet.”

Power motion – push a button and the recliner or motion sofa goes exactly where the user wants instead of to a preset position – is more expensive, but the customer can experience the benefit firsthand in the store.

“Our (motion) business is terrific and we are in our fifth straight year of sales growth,” Kelley says. “We have a competitive advantage with consumers who want choices. We

34 HGO merchandiser

offer many choices in cover and configuration, so they can get what they want.”

In business as a whole, she says sales are increasing solidly. The 70-year-old, family owned manufacturer is seeing significant opportunities in the United States, especially in incremental volume.

“People in the United States are tired of the recession, and it does seem to be stabilising there,” Kelley says. “We are focusing on maximizing business opportunities in the United States, and in Canada as well.”

Palliser and others are seeing price pressures in the rising costs of leather and wood, which may mean price increases.

Kelley says the company is still weighing its options.

The best sellers in motion are sectionals, which Kelley says remain popular because consumers can get exactly what they want. Palliser does a significant business in transitional styles, with popular features like ratcheted headrests and built-in USB chargers.

In design, Palliser is continuing with new takes on recent trends, mostly transitional to contemporary in a generous scale. “In the past, (our motion furniture) has been more padded, and it’s still a very large category for us and we certainly won’t abandon it,” Kelley says. “But we’ve got styles

The Canadian consumers' love affair with cheap Asian imports appears to be ending, and this is creating new opportunities for domestic motion upholstery producers. Power mechanisms are particularly popular with consumers, and Canadian resources are happy to offer quality and value, even as the cost of materials continues to go up.

BY MARC BARNES

covered for younger consumers. It’s a bit of a change, with cleaner transitional and contemporary looks, and it’s the direction for the future.”

“We want to give the consumer exactly what she wants, with great choices at great values,” she says.

Retailers can see Palliser’s offerings at the Canadian Furniture Show in June. It also shows in High Point and the Las Vegas. A show for Latin American retailers in planned sometime this year at its Saltillo, Mexico, facility.

The Charlie collection from El Ran features a contemporary design with clean lines, sculpted track arms, contoured foam back and inside pull handles. Other features include optional power recliners, a must in today’s market for motion upholstery, as well as a matching loveseat.

VIA: LOOKING GOOD AT THE HIGH END

Sam D’Andrea, president of Montreal-based Via Furniture, says about 80% of the company’s motion offerings are now sold with power.

“The first thing consumers are looking for in a recliner is comfort,” he says. “With the coming of the iPhone and the iTouch, everything is (oriented to) touch. Power motion is very well accepted; you can get really comfortable with the touch of a button.”

Of course, it’s important for retailers to have power motion furniture on their floors and demonstrate it fully.

“You can’t sell something you don’t show,” D’Andrea says. “When you show power, the consumer sees the ad- }

For Montreal’s Via Furniture, Model 6600 line of recliners, which comes in a configuration featuring a full-foot lounger that resembles a chaise lounge, illustrates the need for both power and good looks – the hot button for today’s consumer.

HomeGoodsOnline.ca

35

Moveable headrests are also becoming an in-demand feature for motion upholstery, particularly those with a contemporary silhouette such as the Murcano from Via Furniture, seen here.

fore, and this year we hope to do a little better,” he says. “It’s started very strong for us and I think it is going to be a good year. One of the reasons is that more and more people are looking for products made in Canada, or at least in North America.”

D’Andrea believes product from overseas, especially Asia, is going down in value while going up in price because importers have scrambled to attract retail floor space. Consumers have reacted by being willing to pay more to get more, so much so that Via has decided to return to the High Point Market in April 2016, he says.

The brightest spot for Via has been the Model 6600 line of power recliners, which includes a model with a full-foot lounger resembling a chaise lounge, and a sectional. “The comfort, the look, the price, everything about it is highend,” says D’Andrea, adding those attributes will be expanded in future models.

“We see that, first of all, the comfort and the look are the main things,” he says. “We will show at the June market in Toronto more advanced technology in our recliners, and we are going for more transitional to contemporary stylings.”

D’Andrea says a big part of Via’s business centers on custom applications. Consumers can have any sofa, loveseat, sectional and chair in any style they want, as long as they don’t ask to change the size of the seat cushions.

“At the high end, we haven’t felt much of a recession in Canada,” he says. “There is some recession in the States that they are coming out of. We see things as very positive now.”

EL RAN: MORE GROWTH ON THE HORIZON

Also from El Ran, the Devin collection features contemporary styling with an integrated headrest, oversized box arm, lounge seating and an inside pull handle.

Other features include optional power recliners and matching loveseat.

Shown here are the chair and condo-size sofa.

36 HGO merchandiser

vantages. They don’t have to force it anymore.

You can stop it anywhere you want. You can put your feet up three inches or six inches or all the way up.

“The new recliners we’re selling typically include a power headrest,” he says. “You adjust the head for maximum neck comfort.”

The weak Canadian dollar means higher costs for Via’s U.S. Mechanisms, D’Andrea says. But after a recent 3% to 5% price increase, he doesn’t see further hikes if things remain as they are.

“Last year, we were up 5.5% over the year be-

“Consumers are searching for value and quality,” says Eric Abecassis, co-owner and executive vice president of Montreal-based El Ran. “Retailers should look to offer that, along with selection and the excellent after-sale service like El Ran provides.”

He predicts the market will adjust to such changes as the weak Canadian dollar, noting that El Ran plans to remain competitive. He would not say whether price increases are being contemplated, but did say sales were good last year, and he expects continued progress this year.

“Business was good in 2014, with a doubledigit increase,” Abecassis says. “El Ran looks forward to the same in 2015, with an increased presence on retail floors and a growth in the U.S. market.”

“Contemporary looks worked well in 2014 and will continue to do well in 2015,” he says.

“We are constantly responding to the needs and wants of today’s consumer, always providing comfort and quality.”

Retailers can view El Ran’s offerings at the upcoming Canadian Furniture Show and the fall market in High Point.

JAYMAR: DESIGN THAT’S SUPERIOR

Daniel Walker, owner of Jaymar Furniture, says what consumers want – and what independent retailers are best equipped to deliver – is superior design. He also believes the weakening Canadian dollar will have at least some effect on the marketplace.

“Chances are it will be much more competitive than it was six, seven or 10 years ago,” Walker says. “Right now, we’re buying leather from Italy and (components) from Leggett & Platt with U.S. Dollars, but (even) with leather, wood and foam prices rising, it will make Canadian manufacturers more competitive versus imports from Asia.”

Price increases may become necessary, he says, given the high-end materials that typically go into Jaymar products.

“We have already seen our business go up this year, with increases in new orders since December,” Walker says. “The sell-through of higher-end products is not going through the roof, but we are doing an excellent job. What I’m seeing is that higher-end leather is selling faster than it was a year ago. It’s a higher-end product, and Jaymar wants to offer the best there is.”

In 2014, the company finished with a sales increase of about 9%, with probably 25% more volume, he says.

Walker bought Jaymar from Groupe Bermex Ltd. last October, and he believes there’s much work to do before the company reaches its full potential. Since the acquisition, Jaymar has added 50 to 60 fabrics and 30 leathers in a variety of colours, from darker to lighter, including bright oranges, blues and greens. They are also shipping within four to six weeks.

“It’s all special orders, and the designs are well-packaged and well-shipped, with excellent customer service,” Walker says. “That’s what retailers are looking for. “I’m planning to

grow the business, and I am happy right now – we have a better product and more of it.”

Jaymar will be at the Canadian Furniture Show in June, and also shows at the High Point Market.

MARCANTONIO: TAKING ADVANTAGE OF CONSUMER DISPLEASURE

At Marcantonio Designs, production manager Dennis Marcantonio says today’s consumers are searching for quality and for North American-made goods with designs they can’t find anywhere else.

“It was a very busy year last year, as sales were up by maybe 10%,” he says. “We are thinking that we will see no growth this year, because we introduced new things to the line last year.”

He reports retailers are seeking out Canadianmade products, because the stronger U.S. Dollar makes this country’s goods relatively lower in cost, and because of an increasing consumer backlash against lower-quality goods from Asia.

“They’ve become fed up with Asian products,” Marcantonio says. “It’s really not going to be an issue any more. They’ve cut prices and cut quality and people want to buy local, to support the economy here. They understand now why Asian product is so cheap, because (the furniture’s) mechanisms are wearing out, the material is wearing out and they are having to have them hauled away.”

For Marcantonio Designs, the most successful line is the Concerto. “I think it did so well because it is a good-quality, big couch that is very comfortable, and it was a look that everybody was going after last year,” he says.

Marcantonio said Concerto is a good example of a transitional look. More pieces with transitional and contemporary style influences, along with new leathers and fabrics, will be among the 20 introductions set for the June Canadian Home Furnishings Market. HGO

Marcantonio Designs, most successful collection line is the Concerto, seen here.

This transitional look has proven itself popular particularly when applied to a big, comfortable sofa.

Retailers are seeking out Canadianmade products, because the stronger U.S. Dollar makes this country’s goods relatively lower in cost, and because of an increasing consumer backlash against lowerquality goods from Asia.

A regular contributor to Home Goods Online, MARC BARNES is a High Point, North Carolinabased freelance writer with considerable experience in the furniture industry.

HomeGoodsOnline.ca

37

MATTRESSES

The Marshall Premier Supreme mattress, seen here, is a medium-soft, two-sided pillow top design featuring 1,002 cotton-wrapped and sewn pocket coils in each queen-size that fully adjust to the body’s natural contours and provide proper spinal support. It is upholstered with New Zealand wool, contains three layers of flexible ‘convolute soy’ foam, compressed felt pads and natural cotton fibre.

38 HGO merchandiser

Moving away from

RECESSION

The consumer is interested in sleep technology, which explains the surging interest in adjustable beds or hybrids.

But new research also shows she’s willing to pay more than the typical retailer thinks to get what she wants.

BY MICHAEL J. KNELL

O

VER THE FIVE YEARS BETWEEN

2011 and 2014, an average of 14.6% of all sales generated by furniture and home furnishings stores in Canada came from the mattress department – ranging from a low of 13.7% in 2011 to a high of 15.6% in 2013, an analysis of data published by Statistics Canada reveals.

This somewhat surprising considering conventional industry wisdom for most of the past three decades held the mattress department accounted for roughly 10% of sales. This certainly suggests mattress sales are more important to the typical furniture retailer than previously believed.

Where conventional wisdom has been ‘righton-the-money’ has been gross margin percentage. As an industry, mattress sales have generated an average gross margin of 54.4% over those same five years – which appears to be higher than that generated for most other furniture categories.

There are things Statistics Canada doesn’t track. For example, while our national bean counter follows shipments, imports, exports and retail sales, it provides very little detail beyond that. For example, it can’t tell us how many mattress speciality stores were open in this country last year – they are included in furniture stores. When it comes to mattress shipments, they don’t differentiate between

end-use categories: residential replacement (retail), hospitality, health care and institutional. StatCan also doesn’t differentiate between construction types: innerspring, pocket coil, foam, latex, water, air or whatever. It also doesn’t track units shipped.

But if experience is guide, the dollar values it publishes are – for the most part – accurate and give useable insight into the industry’s overall performance. But it helps to know how to read the data.

This lack of hard accurate data makes creating meaningful benchmarks to evaluate and evaluate industry performance. For example, the International Sleep Products Association (ISPA), a U.S. industry group, publishes monthly reports that include statistics on units shipped (and their construction, be it innerspring, foam, latex, or other), dollar volumes and other key metrics. No such report exists for the Canadian industry.

After chatting with a number of industry insiders, including both manufacturing and retail executives, here are a few key facts bed- }

A good example of a hybrid mattress, the Vogue Ultra from Canadian specialty mattress maker Zedbed creates a cooling sleep surface, with comfort and support, by infusing the gel-crystal in to the mattress’s open-cell structure.

HomeGoodsOnline.ca

39

Furniture stores (including mattress specialists) account for about 89% of all mattresses sold in this country, a share that hasn’t changed in many years.

Tempur Sealy Canada has re-invented most of its popular Tempur-Pedic branded collections for 2015, including the model shown here, based on the results of its own research and consumer surveys. This mattress was specifically designed for a wellness-seeking consumer willing to invest a little more to get the best night’s sleep possible.

40 HGO merchandiser

ding merchandisers – whether working for a mattress speciality store, an independent fullline retailer or one of the major regional or national chains – should be aware of: • The key retail price point for a queen-size mattress ranges between $699 and $999, with the consensus resting at $899; • The key retail price point hasn’t changed all that much in the past three decades; • Because of aggressive advertising on the part of the larger Canadian retailers, many manufacturers believe the new promotional sweet spot will $399 in 2015 and 2016; • Furniture stores (including mattress specialists) account for about 89% of all mattresses sold in this country, a share that hasn’t changed in many years; • This suggests big box stores (Costco, Walmart, etc.) and the e-commerce providers have yet to make significant inroads into the industry at retail; • Approximately 70% of all mattresses sold in this country feature innerspring or pocket coil construction; • The key retail price point goes up in the remaining 30% of the market, which includes latex, foam and other speciality constructions, where it can be as high as $1,499;

• The consumer still has great interest in

bedding technology; and, • The two fastest growing categories are adjustable beds and hybrid mattresses.

In 2014, mattress shipments and exports were both down over 2013, resulting in an apparent Canadian market (shipments plus imports less exports) that was essentially flat on a year-over-year basis. Furthermore, it has yet to make its way back to its pre-recession high of $1.04 billion.

“Business was tough in 2014; we saw a decline in market share at a company level in the $499 to $799 price band,” was how Valerie Stranix, chief marketing officer for Sommex Bedding Corporation – the makers of the Natura World, NexGel, Obusforme and Sommex labels – described it. “The Major S brands (the Canadian branches of Simmons, Serta and Sealy) have continued to eat away in this price level and continue to do so in 2015.”

David Gélinas, executive vice president of speciality mattress maker Zedbed, offered a slightly different perspective.

“The Canadian market is big and business conditions are not the same from coast to coast.

Last year, the eastern provinces (Quebec, Ontario and the Maritimes) had tough time but the }

MagnIFlEx pRESEnTS...

your side my side

FIRMER

SOFTER

simply unzip the cover and select your individual comfort For Canada please contact Richard Landriault 905 481 0940 rlandriault1@videotron.ca SLEEP IS LIFE’S GREATEST PLEASURE.

41

Magniflex USA, Ltd. 3050 Biscayne Blvd, Ste 200 Miami, FL 33137 p.646-330-5483 alt.646-688-5775 f.646-607-9190 info@magniflex.us www.magniflex.com HomeGoodsOnline.ca

EDITOR’S NOTE Home Goods Online will soon publish its Special Report on the Bedding Industry in Canada.

It will be available at HomeGoodsOnline.ca.

Left: Sommex Bedding Corporation recently created the new Sensational collection for its Natura label, featuring what it calls Active Fusion, which is designed to keep a warmer sleeper cooler and a cooler sleeper warmer by moving heat either to or away from the body as needed through the night. The fusion layer varies in thickness from two to four inches and is supported by a six-inch soft latex core, surrounded in a wood ticking.

Right: When Serta launched iComfort a few years back, it made waves throughout the industry.

It is now offered with adjustable foundations, where the user can adjust either the head or the foot of the bed for maximum comfort and support.

It also offers a variety of massage options and other technological advances.

42 HGO merchandiser

other provinces were not bad,” he says. “In Quebec, provincial elections and bad weather negatively affected the beginning of the year. The months of March, April and May were very slow versus the same months in 2013. With the massive arrival of Sleep Country Canada in the Maritimes, there was a lot of stress placed on independent retailers. They were hurt because they didn’t adapt their selling and merchandising strategies to the threat. They’re now trying to compete but a lot of work still needs to be done.

“In general, I would say business was flat,” he continues, adding, “Because the surging U.S. dollar and the falling price of gas contributed to a better economy, we noted a much stronger business during the last quarter of the year.”

What’s interesting as a counterpoint to what’s happening at manufacturing is retail sales were actually up 2.5% last year. While they also haven’t returned to their peak – reached in 2008 at $1.8 billion – retail mattress sales have climbed three years running.

It’s too soon to tell if the shift is permanent or not, but it seems consumers are starting to move away from larger retailers and are instead buying mattresses from independent and regional retailers or specialty sleep stores.

For the past three years, Statistics Canada’s Group of Large Retailers has seen their market share of mattress sales fall in each of the past four years. Indeed, their mattress sales in dollar terms have fallen in each of the past six consecutive years and are now more than $100 million less than they were in 2008.

The Group of Large Retailers consists of the largest retailers in the country. For big ticket home – particularly mattresses – it includes heavyweights such as: the Brick; Leon’s Furniture; IKEA Canada; and, BMTC Group. Several big general merchandise store operators with

active big ticket home businesses, such as Hudson’s Bay, Sears Canada, Walmart Canada, and Costco Canada, among others are also included.

Considering the overall industry gross margin and the upward sales trend, one would also think this means retailers are writing a higher average ticket – but that doesn’t appear to be the case.

Not long ago, Tempur Sealy Canada conducted a consumer attitude and usage survey, chief operating officer Derek Ritzel reports.

Some of the results were quite surprising.

“What we found was the retail customer has moved on from the recession, but the retailer hasn’t,” he says. “The average ticket the retail customer expected to pay was $1,100 but that’s not what’s happening on the retail floor.”

But as Sommex’s Valerie Stranix points out, there are manufacturers who haven’t broken away from the recession either.

“Despite millions of dollars being spent on new premium product launches and new marketing, the major bedding companies continue to drive their top lines with the lower end of their assortments,” she maintains. “While companies like ours have shifted the focus to the higher price bands within our portfolios.”

What’s clear is the process of creating the right assortment for the retail floor isn’t as simple as it was just a few years ago. The factors to consider are becoming increasing complex. But with gross margins of over 50% and the consumer’s move away from the chains and the big boxes, its certainly worth the effort on the part of the independent retailer. HGO MICHAEL J. KNELL is the publisher and editor of

Home Goods Online. He has written about the Canadian mattress industry for the best part of three decades.

“Marketing is the art of meaningful sustainable differentiation.”

– Dave Nichol

EXCITING!

FRESH!

TRENDY!

Wake up at your best

STAND OUT & ENHANCE YOUR USP! Visit us in Orion Room ‘D’ at the 2015 Canadian Furniture Show, June 4-7 Contact Steve Amis, Vice President of Sales 905-564-5008 x313 or steveamis@springwall.com

springwall.com | facebook.com/springwall HomeGoodsOnline.ca

43

Continued from page 13

“Every year brings another wave of innovation,” says St-Arnaud. “Joel keeps a close eye on European styles, and came back from the Milan show with lots of new ideas for shapes, colors and materials.”

In 2015, Huppé plans to continue to enhance its bedroom line with new designs and options.

While it hasn’t set an exact timetable, it will expand the availability of its new metal finish – a big success in the table segment – to bedroom sometime in the near future.

Huppé also plans to accelerate the rollout of its whole-home Atelier retail display program in 2015. The display is a focused, coordinated presentation of eclectic Huppé products that work together across every room of the home. Huppé currently has the gallery in place at Maison Éthier near Montreal. The minimum footprint for the display is 1,200 square feet.

“These Atelier displays are designed to create the same high-impact atmosphere as our market showrooms,” says StArnaud “We hope to install more of these with our big clients in the coming year.”

Huppé also aims to work more closely with other retailers on display and merchandising strategies, she adds. “We want to provide them with creative ideas that will help our products shine. With the right, on-trend presentation, the product comes to life, capturing the consumers’ imagination and generating more sales.”

Business in Quebec and Ontario has been particularly tough the past two years, according to St-Arnaud. “The Prairies and West Coast are not too bad, and we’ve had good success in British Columbia. Economists are expecting business to improve a bit in 2015, so we’re optimistic that Inspired by the inns and wineries of Napa Valley, Calif., Magnussen Home’s Calistoga collection features a distressed charcoal finish on pine with rustic, oiled bronze hardware. Features include touch lighting on nightstands, side-mounted ball-bearing glides and dust proofed, English and French dovetailed drawer construction.

44

sales in Canada will pick up. The U.S. remains steady, and we look for continued growth in ’15.”

Enhancing visual appeal

At Magnussen Home, the bedroom category as a whole was challenging in 2014, according to President Nathan Cressman. “We were up moderately from the year before,” he says. “We are forecasting some bullish growth in the category in the coming six months, and we see most of the uptick coming in the second quarter, as some of the things we have been working on take root.”

The New Hamburg, Ontario-headquartered full-line resource continues to do well with transitional and contemporary looks, Cressman says, noting, “But I have also seen the emergence of solid wood, and the collections we have done in this vein have been trending up since hitting dealers’ floors.”

For 2015, he believes retailers will be looking for more creative use of color as well as new, unique pieces that add to the presentation of the group. “They want a unique finish with depth, a special technique or a combination of materials,” he says, “something that visually brings the consumer to the group to touch it and feel it.”

At the April High Point Market, Magnussen strengthened its bedroom assortment with a number of introductions.

Price points continued to emphasize the $999 to $1,999 retail range (for bed, dresser, mirror and nightstand), which Cressman describes as the “price points that are most meaningful” for volume. “But I saw a recognition on the part of some retailers that they can sell a higher price point.” HGO A regular contributor to Home Goods Online, GARY JAMES is a freelance writer based in Chapel Hill, North Carolina. He spent over 20 years with Furniture/Today, serving as case goods editor and special projects editor, directing the editorial content of Leather Today, Bedding Today, Global Textiles Today and other supplements and sections.

Continued from page 20

“While mid-century modern remains a popular choice for many design lovers, we are seeing a new and refreshing form of modern with Scandinavian Cool. This design trend reflects a laidback style that features simple lines, natural textures (think wood, leather, sheepskin, linen, etc.) and a soft colour palate (grey, white, black, olive green, aubergine, dusty pink and mint).

“Woods are going lighter or unfinished altogether, and metal accents are getting warmer,” Sangha continues, adding, “Gold is still a popular metal in home décor but we are also seeing a major shift to copper, brass and rose gold. These metals create warmth and subtle sheen against the layers of texture and pattern that are found in today’s popular designs. Denim is one of the biggest runway trends today, and while you may not upholster your sofa in denim, you can still reference the trend by incorporating indigo in all its deep, glossy blue glory.”

WHAT ARE PEOPLE PAYING?

Price points have been a bone of contention in the industry for some time. During the Great Recession, independents and majors alike scrambled to hold on to worried shoppers by highlighting more affordable looks and slashing prices across the board – a trend that inevitably hurt everyone’s bottom line and made accounting for increased supply costs that much more difficult. Now, the race to the bottom appears to have ended, and producers are focusing on the middle to high-end price points and seeing satisfying results.

“There is definitely an appetite for a betterquality product with a strong value proposition, including feather-blend seating and higherend textiles,” says Superstyle’s Reynolds. “This category will target a richer price point and obviously raise the average ticket. The low to mid-range of the price ladder has shifted upward due to increased raw material costs.”

Others say that while it takes consumers a little time to realize that investing in a better piece is wiser, most do get there eventually.

Décor-Rest’s Marzilli says, “Our sweet spot is $999 for sofas. There’s great value at that price for consumers. Sometimes they see a nice leather sofa from us for $999 and then they see something similar elsewhere for half the price, but after a couple years, they see that the leather is cracking or the couch is sagging and they come back to us.”

Palliser’s Kelly agrees value is king.

“It all comes down to value,” she says. “We’re a medium to higher price point product, but it’s about what you get for the money you want to spend. We’ll never be at the starting price point, but we offer great value. We listen to our buyers and retailers and provide choices and options and work to improve lead times. You get what you pay for.” HGO A regular contributor to HGO Merchandiser, ASHLEY NEWPORT is a Toronto-based freelance journalist who writes primarily for trade and business publications. Her specialties include food, hospitality and emerging social/business trends.

As part of its new Studio-Line collection, the Trend-Line division of Superstyle, in a salute to the re-emerging midcentury style category, introduced the Model 4735, which includes this backless studio sofa – a silhouette not widely seen in recent years – as well as the companion chair in the foreground.

HomeGoodsOnline.ca

45

INDUSTRY CALENDAR August 2 to 6, 2014 LAS VEGAS MARKET World Market Center Las Vegas, Nevada www.lasvegasmarket.com August 2 to 5, 2015 PRIMETIME The Venetian Las Vegas, Nevada nationwideprimetime.com August 9 to 12, 2015 TORONTO GIFT FAIR Toronto International Centre Toronto Congress Centre Mississauga, Ontario www.cangift.org

ADVERTISERS’ INDEX

August 16 to 19, 2015 ALBERTA GIFT FAIR Edmonton Expo Centre Edmonton, Alberta www.cangift.org

Pages 2-3 Phoenix AMD International 41 Butler Court Bowmanville, ON L1C 4P8 T: 800.661.7313 F: 905.427.2166 www.phoenixamd.com Page 5 Stearns & Foster Tempur Sealy Canada 145 Milner Avenue Scarborough, ON M1S 3R1 T: 800.268.4414 www.stearnsandfoster.ca Page 7 Canadian Furniture Show 101-1111 Saint-Urbain Montreal QC H2Z 1Y6 T: 514.866.3631 F: 514.871.9900 www.canadianfurniture show.com

46 HGO merchandiser

Page 11 Protect-A-Bed 1500 S. Wolf Road Wheeling, IL 60090 T: 519.822.4022 www.protectabed.com Pages 14-15 Cantrex Nationwide 3075 Thimens, Suite 300 St-Laurent QC H4R 1Y4 T: 514.335.0260 F: 514.745.1741 www.cantrex.com Page 19 Zucora 552 Clarke Road London, ON N5V 3K5 T: 800.388.2640 www.zucora.com Page 21 Las Vegas Market 475 S. Grand Central Pkwy.

Las Vegas, NV 89106 T: 702.599.9621 F: 702.599.9622 www.lasvegasmarket.com

August 20 to 23, 2015 TUPELO FURNITURE MARKET Tupelo, Mississippi www.tupelofurniture market.com August 30 to September 2, 2015 QUEBEC GIFT SHOW Place Bonaventure Montreal www.cangift.org September 10 to 11, 2015 HIGH POINT PRE-MARKET Downtown High Point High Point, North Carolina October 17 to 22, 2015 HIGH POINT MARKET High Point, North Carolina www.highpointmarket.org

Pages 24-25 Serta Canada/ Star Bedding Products 40 Graniteridge Road, Unit #2 Concord, ON L4K 5M8 T: 800.663.8540 www.sertacanada.com

Page 47 Home Goods Online P.O. Box 3023 Brighton, ON K0K 1H0 T: 613.475.4704 F: 613.475.0829 www.HomeGoods Online.ca

Page 33 Domus Vita Design 50 Acadia Ave. Suite 100 Markham, ON L3R OB3 T: 905.513.6687 www.domusvita design.com

Page 48 Tempur-Pedic Tempur Sealy Canada 145 Milner Avenue Scarborough, ON M1S 3R1 T: 800.268.4414 www.tempurpedic.ca

Page 41 Magniflex 1000 5th St., Suite 220 Miami Beach, FL 33139 T: 905.481.0940 www.magniflex.com Page 43 Springwall Sleep Products 7689 Bath Rd Mississauga, ON L4T 3T1 T: 905.564.5008 www.springwall.com

LIKE NOTHING ELSE

Nothing feels like a Tempur-Pedic

®

The unique TEMPUR® material responds to your body temperature and adapts to your weight and unique shape, to give you uninterrupted comfort, personalized support, and proper body alignment for your best night’s sleep.

Today, there are many memory foam mattresses, but there is still only one Tempur-Pedic.® Even in a more crowded field, nothing adapts, conforms, and supports like TEMPUR® material.

©2015 Tempur-Pedic Management Inc. All rights reserved. TM Trademark 2015 to Tempur-Pedic Inc.

HomeGoodsOnline.ca

47

Michael Knell’s

HGO this week HomeGoodsOnline.ca

Y THE ONL Market intelligence for Canada’s

home goods retailers and their partners

Are you in the know?

Are you a member of the HGO community?

If not...

Sign up to receive our FREE newsletter

“Like” us on Facebook Connect with HGO Editor Michael Knell on LinkedIn

HGO this week VISIT US DURING THE CANADIAN FURNITURE SHOW INTERNATIONAL CENTRE, HALL 5, KIOSK 22 (NEXT TO PALLISER) OR VISIT US ONLINE AT

HomeGoodsOnline

.ca

FURNITURE • BEDDING • APPLIANCES • CONSUMER ELECTRONICS • ACCESSORIES 48 HGO merchandiserLAMPS & LIGHTING • FLOOR COVERING • RETAIL SERVICES