Retail Perspective
State of the Futon Industry At Retail
- A Futon Life Exclusive
By Joe Tatulli
Our last retailer's futon survey was complied in 1992 for publication in 1993. Since then the futon-industry-at-large has gone through some major changes. The most significant of these changes has been the unprecedented growth in the number of retailers selling futon furniture. These "futon" retailers run the gamut from small, mom and pop start-ups to the huge mass merchants like Sam's Club and Costco and corporate catalog retailers like Spiegel, J.C. Penny's and LL Bean.
Everyone will agree that this growth has been great but it all comes at a price. Most of the futon retailers we talked to were excited about their business and its potential for the future. At the same time they were concerned about several key elements linked to both their prosperity and their survival. In most cases these concerns had a direct link to their futon furniture suppliers. As in most industries that experience projectile growth suppliers can adjust more quickly than sellers. Retailers, therefore, sometimes feel victimized or at least neglected when crunch time comes, just before and during the Autumn futon season rush. It is our goal to bring all these issues to light in the context of this growth curve, lifting out not just the problems, which are a part of any industry's manufacturer retailer relationships, but hopefully some suggestions and solutions.
Overall, the futon retailers we spoke to were upbeat and eager to talk about the place where the rubber meets the road on the retail floor.
The Futon Survey
We decided to gather information on a select group of topics from a relatively small sample. We were able to speak one-on-one with futon retailers from coast to coast. Some of these folks were very willing to talk to us while others were less than eager to answer our questions. In fact several outright refused to tell us anything. We spoke to futon retailers with one store and others who had four to thirty futon stores. Some had futon specialty stores while others were more main stream furniture or bedding stores. After it was all said and done a consensus in the product section of the survey was not apparent. What was apparent though, was the fact that this futon industry's retail trade is very fragmented in what and how it sells.
The product section of our 1995 retail survey asked the following questions:
- What is your hottest selling futon frame and what is its price point?
- What is your hottest selling futon mattress and what is its price point?
- What is your hottest selling futon cover fabric and what is its price point?
The results did not define a clear answer for the first question. None of the futon retailers listed the same futon frame, though several groups of two or three mentioned the same vendor. Generically, the futon frames of highest dominance were the hardwood bi-fold and the black metal bi-fold futon frame. Price point was a little more defined. The average price point for the entire sample was $ 340.00 the median average was $300. The highest price futon frame listed was $599.00 and the lowest was $149.
The hands down winner in the futon mattress category was the eight inch cotton and foam futon combo. Price points were much flatter than the futon frame category. The average price was $170.00 with the median at $159.00. The highest futon mattress price was $349 the lowest was $89.00, with eighty-six percent of the prices coming in under $200.00.
Once again the story on futon covers is similar to the futon frames. No clear winner was evident from the responses we received. Futon cover prices listed went from a low of $39 for solid futon cover to a high of $179.00. for fancy futon cover. The average was $103.00 and the median was an even $100.00.
Other questions were asked to determine an average square footage for a futon specialty store or the size of a futon department in a traditional retail outlet. The average square footage for all respondents was 4800 square feet. The average square footage for futon store floor space only was 3200 square feet. When we coupled this with the average gross futon sales per unit for 1994 of $457,000.00 we arrived at a dollar per square foot of $134.41. Comparing this to the traditional retail furniture industry's median DPF of $120.00 for 1993 (as complied by Furniture Today, January 30, 1995) we are looking pretty good. Considering the fact that 49 out of the top 100 retailers polled by Furniture Today didn't respond with the info necessary to calculate this number we also feel we are in good company with our calculations.
In the category of average ticket for a single sale and largest single sale we got the following results. The average futon furniture sale was $445.00 with the median at $400.00. The highest average was $750 and the lowest was $200.00. For highest single futon sale ever the average was $1,730.00 with the median at $1,200.00. The highest-sale-ever reported was $4,500 with the lowest at $470.00.
All prices are based on futons in full/double sizes.