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Home Furniture - Part 2 - Complete Buying Group Support

Furniture World Magazine


Three retail members speak candidly about the the advantages of being big... and independent.

April Furniture World, traced the history of Home Furniture, all the way back to Henry Gilles' turn of the century conversion of Elmira's Main Street blacksmith shop. In l996, the Home group's purchasing power is an impressive $3.5 billion annually, $l billion in Canada alone, and still growing.

Home is 100 percent dealer owned, and is governed by a l6 member Board of Directors, dealer-owners from all across Canada. Dealer-owners also sit on a national Advisory Committee which represents Central, Western and Eastern Canada. The Committee scrutinizes furniture operations and directs management in order to maintain the efficient functioning of all dealer programs.

One-stop-shopping is provided from the 225,000 square foot warehouse facility at Elmira. Volume purchasing of quality home furnishings, sourced worldwide, ensures competitive product costs to the retailer.

We talked with Bill Ladouceur, affectionately known as "The Grandfather of Home" although he protests that, at 48, he's "A young grandpa! Twenty years ago, I worked with my brother, Bob, who owned the Home Hardware store here in Belle River, Ontario. He's retired now and Dan, my younger brother, runs the store.

"In 1976 we sold furniture on a small scale above the hardware store, and were doing quite well. That inspired me in 1976 to 'join the family' in Home Furniture's infancy when they decided to create a separate furniture division."

Grandpa Bill's 6,000 square foot store is located two blocks away from Dan's hardware store where he enjoys a loyal customer following and takes pride in his customer service. The brothers always attend Home's April and September markets together and enjoy the "informative meetings, great seminars and excellent guest speakers".

Bill is the newest dealer to join the Advisory Committee, representing Southwestern Ontario. "We meet three times each year and handle any problems that arise with the other dealers. It's an opportunity to put things on the table. We review advertising for the upcoming year, decide what direction we want to go. And we talk about what new companies we should be buying from, and which we should eliminate."

He enthused about the benefits of the Home system. Top of his hit parade is "Warehousing of inventory, the convenience and availability of product. There are thousands of skews, and if I order by 10 p.m. Monday, the product is at my door on Wednesday, delivered by our own trucks, our own drivers. It's really impressive to the customer, too. A couple of days ago in the store a customer asked about a particular dinette set. I said, 'Just let me check the computer', and 30 seconds later I told her the dinette was in stock, its price and when it would be delivered. It's the Stock-Talk system. We dial an 800 number at head office, punch in our PIN number and store number, then the skew number of the product.

"Another big benefit is that we don't have to worry about dealing with all the manufacturers. Home negotiates prices and deals for us all over the world.

"The national flyer program is also key, beautiful glossy four color flyers, one and sometimes two each month. The cost is minimal, much cheaper than trying to do it yourself. I could not begin to afford to put it out myself. Home also provides radio jingles already on tape and a voice-over print-out, ready to go to the station. And all the programs are theme coordinated.

"The insurance division covers our store, the building, contents, interruption of business, vehicles, everything, and the travel division is a great convenience, gets good prices for us and arranges our tickets."

He extolled the virtues of the Homecard, the group's private label national credit card. which offers deferred, installment and regular revolving financing payment plans. There are more than 150,000 Homecards presently in the hands of captive consumers and Home dealers have access to the Homecard holder lists for their own promotions.

"The people in our head office are very, very helpful to everyone, such a hardworking crew! It really is a family type of program," Bill commented.

Across the country at Grand Centre, Alberta, Murray Murphy and his wife Charan, came on board as a New Venture with Home. Murray is also a member of the Advisory Committee, representing Western Canada.

He was a management trainee, then a manager, with the legendary Hudson's Bay Company. "The Bay taught me the basics of retailing. I was managing the Yellowknife store when the company sold off some of their bigger stores. That's when I decided to come south." (Grand Centre is on Coal Lake, 300 kilometers northeast of Edmonton and 15 minutes from the Saskatchewan border.) "I was hired by a retailer who belonged to the VIP buying group and had three stores of his own. I managed Muller's House of Furniture here for 1 1/2 years and did almost a million dollars in sales the year he retired and closed the store.

"This opened an opportunity for me, but I needed a buying group or some sort of franchise or co-op for support, a banner group. I called Monica (Monica Heinrich is Home's Marketing Manager) and told her I had enough experience to open my own furniture store. She asked me to submit a business plan. With the assistance of a Federal Government program I learned what it takes to be an entrepreneur, how to approach banks, write reports, and construct a good business plan. Monica talked it over with Bruce Hammer (National Manager) and we put together the very first New Venture that Home ever negotiated. Since then someone in Collingwood, Ontario, has made a similar arrangement."

Murray and Charan actually began active selling in November 1991, but their Grand Opening was held January 1992. "We just celebrated our fourth anniversary and we're doing well, but it's still an ongoing struggle. We have repeat customers now, a very good clientele. Charan did the books and paper work at first. Now we've hired someone else to handle those responsibilities and she is top sales person! We're a great team."

Grand Centre has a population of 11,000. It's part of a triad of towns in a 10 kilometer radius and oil and gas are the principal industries.

"Our customers recognize the Home logo. Identification provides a lot of credibility; they know there is a corporation behind us.

"We don't have the time to source products and Morgan McCabe and Bill Hammer do that for us. Morgan just returned from the Far East and we have some wonderful rattan pieces at a great price to offer now.

"We've discovered that customers are less likely to try to bicker with us when they see prices printed on our national flyers. We use both the flyers and radio jingles with voice-over, using the supplied scripts.

"Stock-Talk makes sales happen! Just sold some tables today using computer information.

"We're thinking about another expansion. We started with 6,400 square feet, built our sales, bought new computers. We're making our business more efficient. Our next step is to buy a building, or build on to our existing store. We have 9,000 square feet now. The store is in a strip mall, the best location in town, and the video store next to us closed. We took over and knocked through the wall. Once we make a decision, we will work with Home's store planning, the floor plans, product layout and color schemes."

Murray praises the warranty system, "No problems, no hassle. If something is damaged, and that's very rare, we get it fixed and bill Home. Just recently we had a customer with a broken chair. We offered her a refund. She upgraded, and she's a very happy customer."

The product mix at Gow's Home Furniture, Bridgewater, Nova Scotia, includes furniture, appliances and electronics. Located 20 minutes from the Atlantic Ocean on the Lahave River, 60 miles away from Halifax, Nova Scotia, Gow's is a family business.

Said Bill Gow, "My father owns the business. Nobody else would hire the rest of us so five members of the family work here. My brother Jeffrey, sister Julie, Ken Burke (he's married to my sister Donna), my mother Viola, and Donald Gow, my Dad.

"He was a refrigerator technician and used to work out of our home. When a frige was unrepairable, he'd get in some new ones to sell. The business expanded and he bought a shop. It was soon apparent that selling white goods only was tough, so when a building became vacant and we felt if we didn't do it someone else would, we went into the furniture business. We were with the Cantrex buying group for about eight years and then, two years ago, we joined Home.

Retail floor space is 14,000 square feet, plus 7,000 for warehouse and workshop. "Monica is working with us on a layout and color plan right now."

Bill, like his namesake in Belle River, praised Home's national flyers, and Stock Talk is high on his list of positive benefits. "And they do all the buying. It's nice to buy from one source. Some appliances are purchased outside, but we still bill through Home. With other people it would be like World War III if something's broken. Home is on an honor system and it works beautifully. The dealer education system is very helpful, too."

Bill will be attending Home's spring market in Elmira. More than 600 suppliers exhibit their products in the Company's facilities, and special discounts and terms are offered. During workshops and seminars, dealers receive first-hand sales techniques and demonstrations from the manufacturers. Home advertising and marketing programs are also presented at Market. And its a great meeting and networking site where dealer-owners exchange ideas.

Home's breadth of concept focuses in their dynamic advertising, covering Canada on a daily basis, 52 weeks of the year, using media which exposes it to every Canadian, the foundation of dealer-owners' reach to the consumer.

Next month, we'll look into their circulars, mini-catalogues, catalogues, Christmas catalogue, television and radio commercials, in-store point of sale material, and the extensive communication system, including weekly and monthly newsletters, between dealer-owners and head office.

Bill Ladouceur, Murray Murphy and Bill Gow endorse Home's slogan, "We're proud of our Home"!