HIGH POINT — As summer winds down to a close, so does the last furniture retail holiday of the season — Labor Day weekend — having given retailers one more chance for big weekend sales and, hopefully, a positive outlook for the rest of the year.
“Usually Labor Day is a good indicator of how the rest of the year will run, even though we are in a crazy year with social unrest and pandemics and everything else,” said Charlie Malouf, president and CEO of Fort Mill, S.C.-based Broad River Retail, the largest independently owned Ashley HomeStore licensee.
If Labor Day is an accurate predictor for the rest of the year, though, Malouf said all results from the weekend indicate that the rest of 2020 will be good for the retailer’s 24 locations.
“For our retail stores, it was the strongest week we have ever had in total revenue, although, to be fair, we have a couple of new stores that we didn’t have last year,” said Malouf. “We actually had one store that we’ve had for quite a long time that did the most revenue its ever done in its history over the week. … Total sales were up double digits overall over last Labor Day week.”
The retailer took a three-pronged approach to its three weeks of Labor Day promotion this year. In addition to some doorbuster offers at up to 50% off, customers could also choose between a “buy more, save more” discount or a special financing program through the Ashley Cares program, which the retailer has had in place for about six months in response to COVID-19.
With the “buy more, save more” deal, customers could get anywhere from 10% to 25% off their purchase, depending on how big their total purchase ended up being.
For those not interested in the discount program, Ashley Cares — through a partnership with Elite Rewards — offered interest-free long-term financing with payment assistance available for three to six months.
“What we typically see on this promotion is that most folks take advantage of the storewide discount offer,” explained Malouf. “And we offer that with a really aggressive 12 months deferred interest with our partner Synchrony or TD Bank or even Fortiva.”
According to Malouf, Ashley Cares has worked best in his stores as a traffic driver, peaking consumer interest enough to get them in the store, even if they ultimately go with the more “meat and potatoes” discount option.
In the sleep category, business was good, too, and Broad River Retail’s stores led with their premier brand, Tempurpedic, touting its national offer of up to $500 off select mattress sets and pairing that with $300 worth of “Ashley cash” to be used on furniture or on bedding accessories.
Ultimately, over last year and the company’s historical averages, the weekend was stronger, and a few stores were “over 30% balance of share in sleep,” according to Malouf.
“Sometimes we see these tent pole weekends, as we like to call them, when mattress brands are advertising really aggressively with strong national promotions, we usually see our balance of share in the sleep category increase.”
Malouf noted that consumers were still being motivated to shop over Labor Day Weekend by time spent at home because COVID-19 fears and cancellations, alongside the traditional Labor Day motivators, which is home prep ahead of the holidays.
Bigger share of the wallet
“I think we’re definitely benefiting from the ‘stay at home’ economy,” said Andrew Koenig, president of Tamarac, Fla.-based City Furniture. “The home is more important than ever so we see a bigger share of wallet despite some of the tough job losses out there.”
Given that trend, Koenig said that he was prepared for a big Labor Day holiday. Marketing 10% off non-sale items across the store or a special 60-month, no-down-payment financing option alongside mattress offers and product sales, the four-day event was marketed using City Furniture’s traditional channels — television advertisements, billboard, direct mailers and more — and through digital channels “aggressively.”
“Our team executed an amazing Labor Day weekend year-over-year,” said Koenig, though he declined to offer exact sales figures. “Our sales and traffic, both online and in store, were huge record-breaking levels for us. We surpassed our goals very nicely, and I am especially proud of our sales teams’ focus on safety and customer service throughout the entire weekend, and it showed with the results.”
Throughout its 21 locations, products from the living room, home office and patio categories, alongside mattresses, traditionally an important category on Labor Day weekend, all sold well.
According to a report from Truist Bank, anecdotal reports from the mattress industry overall point to “early indications of a positive sales weekend vs the prior year” both in store and online as the channels “continue to merge somewhat like we have seen in other retail.”
“After struggling in April with many stores closed, the recovery in the furniture/mattress market has been astounding with continued reports of more than 20% sales growth from June to August,” wrote the bank holding company. “Demand has gone beyond a push forward from a weak March as the continued investment in the stay-at-home trend in this sector is not letting up, in our view.”
Although City Furniture and Broad River Retail both noted similarly positive weekend results, Broad River Retail did have a unique advantage going into the weekend: two new store stores, which the retailer celebrated on Sept. 3-4 with ribbon cuttings followed-up by grand opening weekend celebrations. During the downsized openings, the retailer gave away branded umbrellas, Bedgear face masks and “bounce back” gift certificates.
“Doing a grand opening during the pandemic is something you can’t avoid, and of course we couldn’t do everything we wanted to,” said Malouf. “But I’m just glad we could at least do something.”
New stores, new protocols
Kimbrell’s Furniture opened its new, 45,000-square-foot Wilmington, N.C., location as a kick off to the Labor Day holiday weekend, the final of three openings that the company began last year when it acquired three former Toys R Us locations across Eastern North Carolina.
Because of coronavirus concerns, the ribbon cuttings and opening weekend for the stores were scaled down, comparable to a soft opening, said Jerry Peters, vice president and chief merchandising officer for Kimbrell’s, but that it still had a successful first Labor Day weekend.
Overall, Kimbrell’s reported being up 10.5% over the three-day weekend, despite being slightly down on Labor Day itself, with a location-wide offer of $100 off of purchases of $1,000 or $250 off purchases of $2,500 or more, paired with different doorbusters at each store, promoted primarily through digital marketing channels, an effort the retailer has ramped up over the past six months.
Now, Kimbrell’s is planning to extend its offer more than likely through the end of the month, according to Peters.
“The opening was smaller than we normally would do, but Labor Day was strong overall, and we think it will become one of our top three stores,” he said.
One of the most difficult parts of the weekend and of getting the new store opened, was keeping stock in check. Impacted greatly by ongoing furniture shortages — caused by production stalls during COVID-19 quarantines and shutdowns in the U.S. and elsewhere and escalated by high consumer demand immediately following retail reopening — Kimbrell’s had to adapt its doorbuster offerings by location, and it relied heavily on a few key manufacturers, such as Emerald Home Furnishings and Homelegance, Corinthian, to fill its new location.
That concern was not unique to Kimbrell’s, with Malouf mentioning that shortages have been putting a strain on the Broad River stores as well.
Safety in the COVID-19 environment was also a concern across the board, although it was less of a struggle than it was during the start of the summer during holidays like Memorial Day.
Now, retailers said they feel more prepared to communicate with customers while wearing personal protective equipment, are getting used to increased cleanings and are familiar with how to distance themselves from customers and other sales associates while walking showroom floors.
“We’re getting adjusted, and we’re getting good at working with these new regulations,” said Malouf. “This year has been full of unexpected changes, but we know we can handle what’s going on, and we’re excited to work in this sustained demand for product.”