HIGH POINT – As part of an initiative called “The Big Pivot,” A.R.T. Furniture has realigned its pricing and the scale of its line to reach a broader segment of the market, including younger consumers seeking value-priced case goods and upholstery.
The company also is making a major push to stock its case goods and upholstery in Vietnam to be able ship through a reinvigorated full and mixed container direct program.
The company will continue to stock goods domestically in Ontario, Calif.; however, it will shift most of its emphasis and investment to the Vietnam warehouse program, noted Jeff Young, CEO. Previously, he said, the emphasis was on replenishing the Ontario warehouse first, then Vietnam.
Through the Big Pivot shift in strategy, the company has sharpened bedroom pricing to $2,499 to $3,999 for four-piece sets. Previously the line was priced from $3,299 to $4,999 with many at the upper price points. While there are still some sets priced at $4,999, the line today starts at $2,499 with several priced in a core range of $2,799 to $2,999.
Dining sets are priced from $1,999 to $2,099 for a table and four chairs. Previously they started around $2,199 on up.
The groups also cover a broad range of styles, Young noted. “There is a pretty wide range of styles,” he said. “There are a lot of light finishes, but you’ve got French, you’ve got contemporary, casual and a little more formal. We are covering the range.”
Another key difference is that the sets are smaller in scale, allowing them not only to serve as suites for master bedroom but also for second and third bedrooms, Young said.
“The scale is smaller than the old A.R.T. so hopefully it will fit into more homes,” he said. “I guess the one thing I have heard over and over at this (pre)market is ‘We used to use A.R.T. for the master bedroom, and then we had to go somewhere else for the second and third bedrooms. … Now we can use your line for that, too.’
“Before it was just too big,” Young added. “We were restricting ourselves unnecessarily because of the scale. It was either master bedroom, or it was dining room, which is not the best business in the world to be in.”
Dealers took notice of the scale and styling at the recent Premarket, where the company saw nearly 80 dealers, many of whom wrote orders in hopes of securing product for their floors for the fall and winter selling seasons.
“The majors came in, and they were interested in getting the new product in the fall, and we had to get the order here,” Young said. “We got much more in written business than commitments because if they go home and wait, it is going to be that first quarter – probably February – before they can get something they saw here and liked.”
In upholstery, the company is offering sofas priced to retail from $1,699 to $2,199, said Jason Foy, vice president sales, noting that a major change is that the program offers 84- and 100-inch sofa sizes, most with a matching chair, swivel chair or accent chair. One collection, he said, also offers a sectional.
“The other difference is we have a small handle of fabrics to offer the customer should they not like the fabric we decide to stock in Vietnam and potentially Ontario, Calif., should we decide to bring the upholstery state side,” Foy said. He added that while upholstery in the past would have fallen in the same price points, “it was all collection oriented and had a very specific look to coordinate with our case collections.”
“Our new program is not collection specific and would “make sense” to a much broader base of customers than our upholstery of the past,” Foy said.
But to support this effort, the company is making a big push to achieve what Young calls a “critical mass of inventory” from Vietnam. In the past, he said, customers would be able to order product on mixed containers from the Vietnam warehouse. However, they would likely have had to wait for a shipment because another item they wanted wasn’t in stock.
The company plans to address this issue by stocking the Vietnam warehouse with some $10 million to $12 million in finished goods inventory. Another $6 million to $8 million in inventory is planned for Ontario.
“That is where our money is going to be spent on inventory in Vietnam,” Young said, noting that the company expects to reach this critical mass in case goods in the first quarter of 2021 and the second quarter with upholstery. “Which is a new deal from us. That’s going to be our first priority. And then after our cuttings come through, our second priority is to fill our inventory in Ontario. And that is kind of the opposite of where we were. But it rewards people that can get in here and buy and get it in here at a competitive price.”
Young noted that the program will be open to dealers of all sizes, giving them the benefit to buy product on containers from Vietnam at the best price possible.
“The best price is direct container and it’s more of a value than we were under the existing A.R.T. pricing system,” he said, adding that the pricing out of Ontario will be a little higher than it was. “But our emphasis is on container first because we think if you are going to be competitive in this industry you have to bring goods where you can compete.”
“And it doesn’t matter what size you are,” he added. “There is no one who cannot buy a container from us unless they have a propensity not to.”
He said that being in stock will be the key to the success of the program from Vietnam. To that end, the company also will limit the number of collections it introduces in order to offer a lean and focused selection to dealers wanting stock from Vietnam at the best price.
“We have historically had a lot of inventory at A.R.T. but it has mostly been in California. And a lot of that was (China) tariff affected,” Young said. “So now, in Vietnam, you will see our product, which has an increased value, and it is a one-price system. However much you buy, there are no promotions, no other deals. We are giving the best price first – and we can’t improve on that price – you are paying the lowest price possible and there is no one out there paying lower than you are. And it is in stock. We think that will drive 70% to 75% of our business.”