Retail Observer

RETAILOBSERVER.COM MAY 2022 52 A s many of you know, AVB/BrandSource's Summit 2022 took place at the new Caesars Forum Conference Center in Las Vegas earlier this year. It was a wonderful environment to meet and reunite with the group's Furniture Technology Source (FTS) retailers and our manufacturer compatriots, and a great, positive message of "Own it" was sounded by the AVB leadership. For our home furnishings members, highlights included a Mattress Executive Panel in which our partners Serta Simmons Bedding (SSB) and Tempur Sealy International (TSI) shared their insights into consumer behaviors and bedding trends. Also well attended was a Furniture Town Hall, where Ashley Furniture provided an industry forecast for the balance of the year and outlined the investments it is making to service independent furniture retailers. We would also like to thank Malouf for making the trip to Las Vegas to formally launch our exciting new BrandSource partnership. As we head into the second quarter of 2022, and with some signs of normalcy returning, there is no better time to own our approach to business as we transition to this new environment. While demand remains strong and supply remains short, we are seeing signs of demand softening in certain regions and categories, and backorders, therefore, catching up. On the mattress side of the business, nearly all vendors are back to "just-in-time" deliveries in two weeks or less. This is pivotal for the independent channel, as we have seen the direct-to-consumer, mattress-in-a-box trend accelerate over the past two years, driven in part by extended lead times on traditional mattresses, which is the realm of most brick-and-mortar retailers. Nonetheless, here's a shocking fact that seems to imply that direct sales will continue to gain momentum: More than 50 percent of consumers queried in a recent study by goodbed.com said they are willing to purchase a mattress from a website without ever trying it in a store. This makes dealers' own transactional websites all the more important. Ideally, a retailer's website would drive consumers into their store. But given the seemingly large subset of the population that likely has little-to-no intention of visiting a physical showroom, it's vital to capture their business as well. At Furniture Technology Source we are working every day to ensure that your websites are prepared for this. On the furniture side, major vendors such as Ashley are anticipating a return to "normal" lead times by summer. Of course, with recent events on the global stage, none of us can predict with absolute certainty how the year will pan out on either the demand or supply side. However, signs are still pointing to this summer becoming an inflection point for the reopening of the inventory pipelines. Imported case goods are likely to be the laggards, with the exception being those manufacturers (of which there are many) that have expanded capacity in Mexico. While we anticipate demand to remain strong — roughly at or slightly below 2021 levels — our advice is to pay close attention to your online and in-store traffic and sales. There have been signs in certain regions of softening demand, as consumers reach the breaking point in terms of price-taking due to the industry's inflationary activity. Michael Posa Furniture Trends RO Michael Posa is General Manager of Home Furnishings for AVB/BrandSource and spearheads the group's Furniture Technology Source initiative. You can reach him at Michael.Posa@avb.net. RO THREE DAYS IN THE DESERT: THE DIRECTION FOR THE REST OF 2022

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