I am upset.

I have health issues that are prohibiting me from attending this October’s High Point Market. And this after my spine and heart doctors had my hopes up that I could go for at least a long weekend.

High Point Market is more than just a business event for me. As I have said often, it is more like a reunion with hundreds of friends. And in many cases I have become friends with my old friend’s children and am proud to see their interest in the family business and taking over key roles. I could name a lot of names.

My family feels very connected to High Point, too. My son and his wife met at High Point University, had the wedding in High Point, and now her parents have moved to Richmond to be with the kids and their two children, 2 and 4.

While I am not a party-going guy, there are more events scheduled for market evenings than ever, and lots of new showrooms and buildings to explore, but really every showroom will be updated just for you.

I cannot remember going to market and not hearing a program or speech that taught me something helpful.

I won’t mention my favorite restaurant while I’m in town, but it is spelled Marisol.

I have had unforgettable experiences in High Point. My brace on my paralyzed leg broke one evening when I was emcee at a huge event. I had to hang on to the podium or fall.

Another time, a camera was stolen from my room at the old Holiday Inn, near the current Plaza building. That night around midnight there was a VERY LOUD KNOCK ON MY DOOR followed by, “Mr. Epperson, this is the POLICE!”

As I struggled to put on my brace so I could walk to the door, the voice and knocks kept getting LOUDER. The remainder of that market, people kept asking me what was happening in my hotel room.

While I won’t be there in person this fall, I look forward to seeing everyone at the upcoming April High Point Market. It will be my 100th!

See also:

• Our time away from markets taught us four good lessons … and more | Jerry Epperson
• Be confident in the product we make and sell | Jerry Epperson

The post Yearning for a trip to High Point Market | Jerry Epperson appeared first on Furniture Today.

I am proud of my 20-year-old granddaughter who is a rising junior at Virginia Tech. She is doing well in her courses, which is in a medical field that works with people with disabilities. Imagine that.

We had a long conversation this weekend about her plans for graduate school and life. Of course, I enjoyed hearing about her furniture feelings.

One frustration was how some furniture is almost disposable when you buy it. Her new apartment at Tech has a balcony, and she needs chairs. Her choice according to her are “junky” folding or plastic ones at a mass merchant or much more expensive metal ones that often cannot be bought except in a five-piece set.

Another consideration is transporting every item the four hours to Blacksburg, Va. Her SUV barely holds all her non-furnishings as it is. Her current boyfriend recently got a car barely large enough for him. I owned the family pick-up but gave it away when we migrated to a condo.

She needs a sofa, preferably a sleeper. Do you buy the mattress separately? I never considered that. Her experience with futons (yes, multiple futons) is too miserable to discuss. Do they make futons for anyone but poor students?

Then we discussed other options like stealing our stuff so her grandmother gets to buy new. I’m less than enthused.

Looking for pass-me-downs among friends and family? Maybe. Internet want ads? Ugh.

Of course, my solution was go to a local furniture store in Blacksburg or Christiansburg that can solve all your needs. Wonder if my buddy Marc Schewel has a store there? Or the nice folks at Grand Home or Virginia Furniture or maybe Ashley among so many choices.

Then we went on to discuss her residential plans after school. Does anyone listen to this generation? She doubts it.

By the way, growing up she went to lots of High Point Markets. It was our fun family thing to do on Sundays, and she loved it. Her brother liked it so much he attended HPU.

See also:

• Time to chat? Gen Z reveals ways to improve their online shopping experience
• Gen Zers can be just like every other shopper, until they’re not

The post Listening to a 20-something on furniture, housing and more | Jerry Epperson appeared first on Furniture Today.

I am sitting at home, and I get a text photo of a door with a sign that a highly recognized upholstery manufacturer in western North Carolina had closed all its operations without notice. No more details. If I remember correctly, this company has been owned by a Southern investment banker’s private equity operation.

By the way, the owner of Lane Furniture called his investment business Stage Capital. And Klaussner was owned by a large private equity firm, Monomoy.

I could list about 100 more PE firms in that have invested in some manner in our industry. Our firm is courted daily by private equity firms, hoping we can lead them to their next good investment in home furnishings.

Most private equity firms raise their funds to invest from wealthy individuals, family companies with funds to invest, colleges and other educational organizations, religious groups like the Catholic Church, insurance companies of all sorts and others like large corporations.

Today there are thousands of private equity firms that all engineer their businesses to build a portfolio of successful companies. Some focus on a segment like real estate, consumer goods or the Internet, and most have size limits and requirements.

One fund I know well is based in Paris, with offices around Asia and North America and it can develop products anywhere and then make it wherever is best using funds from around the globe. These are smart people, but they, like most PE firms are dependent upon finding intelligent, knowledgeable, honest and talented people to help them and their money take each investment to its next level.

The home furnishings segment appears so simple to outsiders, but we all recognize the complexities necessary to really succeed. And we can all name individuals who have misrepresented their knowledge and experience, and have led some of our biggest and best companies into ruin. And got rich doing it.

Maybe that is what is missing in this huge business: a better source of the right people who can build successful home furnishings businesses.

See also:

• Doesn’t anybody file Chapter 11 anymore? | Bill McLoughlin
• Finding the parallels between Klaussner and UFI/Lane | Sheila Long O’Mara

The post What’s missing in those private equity deals? | Jerry Epperson appeared first on Furniture Today.

The sad news about Klaussner’s closing has brought back many memories. Back in 1979 when I was working for Wheat First Securities, I received a call right before leaving for the spring High Point market from the CEO of one of the largest U.S. furniture manufacturers, asking if I would meet one of his good friends at an association’s office at a time. I agreed and was intrigued about meeting a large manufacturer from Europe.

In the association’s offices several days later, an associate from Wheat and I met a surprisingly young Hans Klaussner, the CEO and owner of Hukla-werke in Germany, one of the largest and most successful upholstery manufacturers in Europe.

From the beginning, I sensed that Hans was as unsure of why we were meeting as I was. Soon, he asked what I thought of Naperville, Ill.-based Kroehler, which at the time was the largest upholstery maker in the U.S., and its stock was traded publicly. I explained that I was not recommending it as an investment. Asked why, I explained it had a long record of losses, was very dependent upon retailer Levitz and operated unionized factories in a largely nonunion industry. Some retailers had recently dropped Kroehler because of its pricing and how close it was to Levitz.

Hans did not like hearing this. He explained he had employed a New York investment banker to assist him in acquiring Kroehler.

Having heard my comments, he asked “If not, who should I buy in the U.S.?”

Months earlier I had been fortunate to meet a true entrepreneur, Stuart Love, at his factories in Asheboro, N.C. I had been very impressed for many reasons, one being his speedy deliveries that retailers loved.

We got to our cars and drove to Asheboro, and Hans got to spend time with Stuart. He recognized that his company was growing quickly, making solid profits and had a strong management team including the respected J.B. Davis. Months later the transaction was completed, and the company renamed for its new owner.

Klaussner enjoyed decades of growth and profits before it changed owners about seven years ago.

I visited the company many times over the years, and the team there always was most hospitable. I hate to see this closing because it will create more questions about the profitability of our industry. And we don’t need that.

See also:

• Everything there is to know (so far) about Klaussner’s shutdown this week
• Finding the parallels between Klaussner and UFI/Lane | Sheila Long O’Mara

The post Introducing Hans Klaussner to Stuart Love | Jerry Epperson appeared first on Furniture Today.

Is there a perfect word to describe the most recent June quarter’s furniture and mattress sales?
Disappointing?
Poor?
Stinks?

But it was a very complicated quarter for other reasons other than consumer apathy. The Consumer Product Safety Commission’s proposed new “tipability” standards,  originally effective May 24, made many domestic and imported bedroom manufacturers make and ship products before the deadline, often at deeply discounted prices.

Government statistics show clearly that Americans shifted from buying consumer durables in 2022 to favoring consumables, non-durables and smaller ticket items in 2023. Out traffic declined sharply, frustrating many of us.

Even the weather hasn’t been kind to us. Most of our nation has been suffering from so much heat!

Good old moderate-temperatured Richmond will post a heat index this weekend of 104, making a trip to Las Vegas a cool thing to do. Vacations, restaurants and sporting events are back in favor after the COVID disruptions.

History has shown that furniture sells more in the second half of the year than in the first half, mostly because housing sales occur in the warmer months . Makes sense, doesn’t it?

The second quarter GDP grew 2.1%, not great but not a recession either. Let’s hope for our typical second half pick-up.

See also:

• A window into an economy that hurts | Jerry Epperson
• Trying to make heads or tails of economic ‘inputs’ | Jerry Epperson

The post Looking for a pick-up in the second half | Jerry Epperson appeared first on Furniture Today.

Decades ago, I was convinced that being public was the right goal for most larger companies. Given the last decade’s unfriendly takeovers and vulture investors, I cannot imagine wanting to go public these days.

Some of our older companies went public many decades ago, while others often used shares in the otherwise private company as compensation or even to pay bills. The result in some cases is you had too many shareholders to not file the paperwork for being public.

Vaughan-Bassett in Galax, Va., is public, although many don’t know it.

John Bassett III is chairman, and his two sons, Doug and Wyatt, are the other executives. I first knew John when he was a senior officer with Bassett Furniture Inds. in Bassett, Va., but was chosen to run a new facility in Mt. Airy, N.C.

John the chose later to move to Galax and run the smaller Vaughan-Bassett.

Recognizing the rapid growth of wood imports from Asia, John, Wyatt and Doug created an entirely new model for a furniture manufacturer: carrying large finished inventories for rapid deliveries to retail customers and using its strong finances to invest in the latest and most efficient technology in every aspect of the business: wood handling, finishing, discounts on pricing and much more. Many retailers rely heavily on its rapid delivery of quality wood furniture.

We just learned about its quarterly numbers for the three months ended June 3, and it tells a story about how difficult it is for our suffering industry.

Operating earnings were a loss of $49,000 vs. 2022’s $1.7 million profit.

Sales dropped to $15.8 million from the prior years’ $28.6 million, an astonishing 45% decline from one of our best domestic manufacturers.

See also: Trying to make heads or tails of economic ‘inputs’ | Jerry Epperson

The post A window into an economy that hurts | Jerry Epperson appeared first on Furniture Today.

A couple of economists have called 2023 a non-recession year, but GDP growth will likely be only 1% for the year, about as slow as you can go. Boo!

And even worse, we are seeing the silly season among our retailers.

One has seen his sales go from 50% upholstery and mattresses to more than 85%, and he is wondering if he needs to keep his modest wood offerings. But a review of his promotions shows a good reason his wood is down: You can’t find any. Don’t have it on your floor if you don’t plan to tell your customers about it.

Upholstery has grown more in the past three decades than wood, it’s true. It has happened elsewhere in the consumer goods market: SUVs have outgrown sedans; pants, leggings and denim have largely displaced skirts; and in many  cultures, meats and sugary foods have lost market share to healthier offerings.

But a closer look gives more insight: Wood furniture has experienced more deflation in pricing than upholstery thanks mostly to the growth in imports, which now account for 90% of wood furniture we sell at retail in the United States.

See also: What ‘wood’ you like to see in case goods?

The post Keeping an eye on wood furniture | Jerry Epperson appeared first on Furniture Today.

How long will furniture and mattress sales remain slow? At the time I am writing this, the latest government numbers showed consumer confidence continuing to fall, but consumers’ spending keeps increasing, at least on services, disposables and non-durables. Nuts.

But there is a trend very obvious to me and all my peers who read the obituaries every morning. At my age we should go to more funerals and hospital visits and to fewer but more enjoyable weddings and graduations. Of course, the weddings are often the friends’ third or fourth we have attended, and the graduations are for our grandchildren.

The media has noticed this, and it seems most ads are for healthcare supplements, skin creams, constipation, cruises, cheap life insurance and retirement villages.

The largest and fastest growing in the obituary competition are the famous “post-war Baby Boomers,” now aged 59 to 77, and the cause of death reads most often something about the heart, one of the many cancers or some form of dementia. When you read that the average life expectancy of an American male is just over 76, it makes senior citizens like me nervous but brings broad grins to the local funeral homes.

Until about a decade ago, we “Boomers” were the largest population segment in the United States at 77 million, but we have been surpassed by the Millennials.

Even so, we are still the wealthiest generation EVER by a LOT. We bought homes, stocks and started many of today’s most successful businesses long ago, and now they are worth fortunes. Our generation was the first to have retirement plans, life insurance, forced savings plans like 401-Ks and so much more.

As we Baby Boomers go toward our long sleeps on clouds (as we have promised in selling beds for decades), our descendants will be inheriting between $14 trillion and $21 trillion — TRILLION! (depending on the analysis) — and many houses and other real estate.

This will be the LARGEST WEALTH TRANSFER in history, and home furnishings should be one of the larger beneficiaries! Yea, us!

See also: Take a look at the idea of ‘outlets’ | Jerry Epperson

The post Baby Boomers still bring something to the table | Jerry Epperson appeared first on Furniture Today.

Do you read a lot of economic news? Thanks to 24-hour cable business news and regular TV news (which use local talent that can be funny!), the remaining credible newspapers, a few magazines and an infinite number of Internet channels and blogs, you can waste all your time on reading about the economy.

And since the economy is so interlinked with politics and global relationships, you cannot possibly stay current on all the latest news, statistics and opinions.

No way.

And, by the way, 99.9999999% of us can do absolutely NOTHING about what is going on. Yes, essentially all of us are just along for the ride.

For those of us who watch the economy and are making silly attempts at forecasts, this can be fun or life destroying.

Right now, all are seeing very similar inputs, but we still have as many interpretations as ever. This strikes me as odd.

Here’s the “news”:

1. The Federal Reserve has implied it may only need one more small rate increase.
2. The latest inflation news has been promising, with April’s 0.4% or an annual rate of 4.9% being the best since April 2021, about when inflation began to get out of control.
3. This would appear to imply that the recent rate increases have been successful in bringing inflation back in check, although well above the lower “target” rate.

Of course, declining interest rates are the holy grail in economics and can be a welcome boost to home sales, the stock market and so much more.

See also: Be confident in the product we make and sell | Jerry Epperson

The post Trying to make heads or tails of economic ‘inputs’ | Jerry Epperson appeared first on Furniture Today.

The major markets, like last month’s in High Point, always creates anxiety prior to market dates. Thank goodness, this market like the last several post-COVID, was successful and filled most expectations. Not everyone went to the lengths Hooker Furniture did setting a new standard for showrooms in the Showplace. It was exceptional in its design and functionality.

But I believe we have learned lessons from our COVID-created absences.

First, I sense a greater appreciation among all the participants for the importance for High Point especially in terms of communication, relationships and education.

Second, there has been an upgrade in exhibitor/dealer respect. Prior to the market, there were more contacts to make the dealers feel welcome and to explain what they could expect in the showroom, not only new introductions but new services and people. These came on many levels, not just mail, but email and all the social media sites, special communications to new events, and teaser items to make sure the dealers were curious about what is coming and improve their presentations.

Third, the investment in High Point has been impressive and has assured other exhibitors to improve their game too.

Finally, we all need to recognize that we are in an industry that is healing after three years of unexpected chaos. It won’t happen overnight, but our many challenges are improving, and our business is returning to a longer term trend.

What did COVID teach us? When our consumer base gets some additional discretionary income, home furnishings become a higher priority and we prosper. That will happen again as inflation diminishes and the population continues to grow. Not everyone has our potential.

See also: 5 takeaways from High Point Market | Sheila Long O’Mara

The post Our time away from markets taught us four good lessons … and more | Jerry Epperson appeared first on Furniture Today.