Three Issues as We Are Coming of Age

It has been my experience that with maturity comes a willingness to discuss the weightier matters of life. When I was younger, issues like retirement and my mortality usually didn't make it to the hot topic stage. They now do. In the futon furniture industry our actual maturity, or a lack of it, is becoming a factor. Let's look at the facts. Most vendors and dealers who are presently in the marketplace have, at least, a cursory understanding of the category. New players are coming in at both the vendor and dealer levels. There is a constant shakeout occurring as the landscape of players changes, and the answer to the following question is on the top of everyone's list of vital information, "Where are we?"

In the autumn of 1994, the Futon Association embarked on the difficult task of doing a third party manufacturers survey. It was determined then that without the hard numbers we would always be perceived as an immature stepchild of the larger home furnishings industry. The process began by hiring Association Research, Inc.. This company is not only expert in its procedures and highly regarded for its integrity, but it is also the same firm used by ISPA and NHFA to track volume and market share, as well as many other statistics important to their members. To put it simply, they supply hard numbers for two of the most respected trade associations in the home furnishings industry. The second aspect of the plan was more difficult. Unlike the bedding industry, where a small group of very large, mature corporate players dominate the landscape, the futon furniture industry is composed of many smaller players. Another factor to consider, with a component based product, is the real challenge of finding every major manufacturer in every discipline (mattress, frame and cover), and then getting them to respond. Undaunted by the task, Association President, Bob Naboicheck and Administrative Director, Tim Jacobs, aided by the entire Association Board and other past Board members began connecting Association members and non-members alike with the research firm. This is where the issue of market maturity hit home. Some suppliers balked at releasing their numbers, to the degree that Association Research would not release the initial figures. We had not met the minimum criteria for Association Research to reveal their results. I could say it again in another way but I think you understand. At a recent meeting of the Association Board it was revealed that we are ever so close to getting the participation percentage necessary to have these hard numbers published. For those of you who are in the management position to make these decisions and have decided to keep your much needed numbers to yourself, might I be so bold as to say, "grow up."

Who Will Lead Them

Since we're talking about the Association let's look at another issue facing Association members at this year's show in Phoenix, where once again new Board members will be elected.

When I was chosen to serve on the board in San Diego, in 1993, FAI was a smaller, gentler association. Since then running the Association has become a rather substantial business. The board deals with issues concerning a full time staff, operating budgets, PR plans, legalities and government regulations, a growing trade show, and providing membership services to over 500 companies. The Board, which is elected by the members, and does all its work on a volunteer basis, is being asked to plan, sometimes two or three years in advance, all the meetings and events of this growing association. Well this is my personal call to action. FAI needs several very high quality people to step up to the plate, and the membership needs to look carefully at each nominee's qualifications. Some difficult issues lie before this industry and the next FAI Board will be making some critical decisions about them. These decisions will help shape all of our futures. So whether you are a voter or a nominee think carefully about this issue.

Commentary: Credit Issues, and Doing the Right Thing

It doesn't matter who you are; when you don't get paid for services rendered it leaves you feeling used. The reality in this industry, as well as many others, is that many more manufacturers get stiffed than do retailers. Why? Most retailers either get cash, a check or credit card money at the time of the sale. Manufacturers and suppliers deliver product with terms, and then wait forty-five to sixty days (or more) for their money. This is no secret and no surprise, just a simple matter of economic reality. The cash flows from the consumer to the dealer and then to the supplier, and being at the end of the chain has its inherent problems (and also its rewards). None of this excuses either buyer or seller from doing the right thing, and in most cases the supplier/dealer relationship works very well because, ostensibly, good dealers always pay their bills. But every so often a dealer arrives on the scene who has no intentions of paying his bills, and this dealer usually comes with a tainted past. This dealer may have burned suppliers in other parts of the country or maybe has worked in another industry and has now found a new mark.

Other industries have third-party credit reporting systems in place for suppliers whereby each month a list of very slow or non-payers is published. Such a list for the futon industry would allow suppliers the advantage of being able to make an educated decision as to whether or not to extend credit. This list would also make evident, by their absence, retailers who are doing the right thing.

Yes, you could say all this takes place at the manufacturing level too, but with literally thousands more dealers than suppliers the statistics lead me to the conclusions I've presented above.

Close Encounters Of The Futon Kind

Have you seen a futon on television lately, or maybe at the movies or on the stage? I've heard about many such sightings but they are not documented. Anyone who sends us a bona fide sighting will be listed on our web site. E-mail me (jtatulli@rtppub.com) with the sighting or send a fax (401-351-0788) and we will put your name and your company on the internet. You can even send a picture of yourself to accompany the sighting. Just imagine your child at school, for show and tell, being able to say "My daddy (or mommy's) picture is on the web."

Bottom line: Futons are everywhere and the more we know the better we are.

To contact the publisher with your comments or Questions E-mail Joe at jtatulli@ertp.com