Furniture News: February 2009 | The Furnishing Report

NEWS HEADLINES
FEBRUARY 2009

Argos opens another furniture showroom as it signals home intent

27th February | multichannel | Catalogue retailer Argos has opened its eighth furniture showroom. The firm, Britain’s largest furniture retailer by sales volumes, has incorporated a substantial home display into its new Norwich Longwater Extra store.

The expansion into furniture displays is a marked move away from its traditional model for the home sector, whereby its products were only available to view through its catalogue or online.

Furniture show makes plea for more state funds to support marketing efforts

27th February | exhibitions | The organisers of US furniture trade fair High Point are looking to secure in excess of $1m from local Government to help promote the biannual event. High Point in North Carolina is home to a cluster of US furniture manufacturers and was for many years the undisputed location for the leading international furniture show in the Americas and perhaps even the world.

Ilva’s collapse costs property firm dearly

27th February | losses | Retail landlord Town Centre Securities was forced to write off more than £500,000 following the failure of Danish furniture retailer Ilva last year. The firm, billed as the grown up Ikea, collapsed not long after opening in the UK after struggling to impose itself on the furniture retail market.

However, the bad debt accrued from the Ilva loss was small fry compared to other losses suffered by Town Centre Securities. It has reported a £72m statutory loss in the half year to December as a result of falling commercial property values.

Exports fall and 2,000 Indonesian furniture workers lose their jobs

27th February | international | Falling export orders for Indonesian furniture has left more than 2,000 furniture factory workers temporarily without work. There has been a 35% fall in the volume of furniture exports leaving Indonesia in the past year. Furniture trade association Asmindo says it hopes to follow Malaysia in targeting emerging economies like Eastern Europe to help boost exports over the next year.

Wallace King Interiors bucks sales trend as store redevelopment pays off

26th February | independents | Four-store independent furniture retailer Wallace King Interiors has increased its turnover by more than 10% following the recent revamp of its Diss store. The retailer doubled the floor space to 12,000sq ft and reopened the showroom at the end of the year.

Like for like sales climb 4.4% at Dunelm

26th February | homeware | Out of town home retailer Dunelm has reported a 4.4% rise in like for like sales in the eight weeks to 21st February. Overall sales in the period, with new stores included, climbed by almost 9%. The homeware retailer’s early year results follow respectable numbers for the second half of 2008.

Furniture boss rails against rates rise as CBI reveals further high stree pain

25th February | sales | Argos chief Terry Duddy is among a host of Britain’s largest retailers calling for the Government to reverse its plans to raise business rates. The Home Retail chief executive is joined by contemporaries at Debenhams and Arcadia Group in seeking a review of measures including the Business Rate Supplements Bill, the ratings review of commercial properties, and the increased rates applied to empty stores.

Malaysia turns to new markets, but problems in the furniture industry ‘have been exaggerated’

25th February | imports | Malaysian furniture exports grew last year and will again in 2009. That’s the view of Tan Chin Huat, who runs the Malaysian International Furniture Fair, which is due to start early next month in Kuala Lumpur.

Courts's creditors to receive just £600k of the £94m they are owed

24th February | retail | Unsecured creditors of furniture chain Courts will receive less than 1p for every pound they are owed. £600,000 of the £94m outstanding debts has been allocated to some firms, while secured creditors will net more than £70m.

Conran Shop sales increase as it plans further international growth

24th February | design | The UK boss of the Conran Shop says the firm has enjoyed double digit sales growth in the past year. The firm, which has two London stores and others worldwide, saw increases across its various sales channels as high as 35%, according to md Nick Moore.

Furniture retailer prepares to wind down Knutsford store

24th February | imports | Independent furniture retailer Cinta is to close one of its three stores. The firm, which sells furniture sourced chiefly from Indonesia, will close its Knutsford store after a drop off in trade and disruption from nearby building works.

Plans for ninth Barker & Stonehouse store thwarted as Duke loses ruling

23rd February | expansion | Land earmarked for a 60,000sq ft Barker & Stonehouse store must be used for employment or industrial use, a planning committee had ruled. Northumberland Estates, which represents the business interests of the Duke of Northumberland, had planned for a £10m retail project in North Tyneside to be spearheaded by furniture independent Barker & Stonehouse, along with DIY chain Homebase.

Autumn trade show to be condensed from nine halls to four

23rd February | exhibitions | One of the UK’s leading outdoor living trade shows is to be reduced from nine halls to four. GLEE, which takes place from 20-22 September at the NEC in Birmingham, made the decision to reduce the event to six halls at the end of last year’s show but has now cut that down by a further two halls.

Liverpool furniture manufacturer opens high street showroom

23rd February | showroom | Liverpudlian sofa manufacturer Aura has opened a retail showroom in the centre of the city. The designer-maker firm, run by Darren Connolly and Paula Smith, opened the Aigburth Road store earlier this month. They have been manufacturing upholstery to order from their Wavertree factory for more than two decades.

MFI stores to be rebranded The Range by millionaire trader

20th February | retail | At least nine former MFI stores are likely to be rebranded following the £68m stock purchase by Chris Dawson, the founder of 37-store chain The Range. The stores will change name to The Range on a permanent basis and more outlets added in the future, dependent on the progress of the MFI stock clearance...........read more

Furniture retailer introduces stock check system for customers

20th February | technology | A Thirsk furniture retailer has launched a stock check system allowing consumers to examine the availability of products via the Internet.

Furniture Traders, which buys returns in bulk from high street stores including Laura Ashley and Marks & Spencer and sells them on at large discounts, has introduced the online system to combat the problem of customers ordering products subsequently found to be out of stock.

Tile retailer bucks sales trend with positive LFL results

20th February | ceramics | Retailer Tile Giant has reported a stellar like for like sales return in the year to 31st December 2008. Same store sales climbed 5.5%, outperforming its chief rivals in the sector. Earlier this week, Topps Tiles was moved to release a statement downplaying the impact of its credit insurance being pulled by one of its suppliers, thought to be Euler Hermes.

Argos launches new Home catalogue and increases in-store furniture displays

20th February | multichannel | Argos has launched its Spring Home catalogue. It is the first from the multichannel retailer since the collapse of two of its principal furniture suppliers – Europa Sofabeds and Meristem Holdings.

Online sales march on, but furniture sales are falling says Internet pioneer

19th February | online | The growth in overall online sales is masking heavy falls in the amount of cash consumers are spending on furniture on the Internet. That’s the view of Julian Field, ceo of Furniture123, the UK’s first online furniture retailer.

Bed sales improve as Scottish furniture and flooring retailers struggle

18th February | sales | Price promotions and credit offers buoyed Scottish bed sales in January, according to figures from the Scottish Retail Consortium. The lobby group says that upholstery also fared better than in previous months, but the overall trend for furniture and floorcoverings remains downward, with sales well down on a year ago.

North west furniture retailer faces battle to find new home

18th February | independent | An independent furniture retailer in St Annes is at loggerheads with the local council as it bids to move to a new home. Paul James Furniture has just a few weeks left on its lease and is currently holding a closing down sale.

However, the retailer wants to move to another out of town location and has pinpointed a site that was formerly a garage, but town planners are insisting the store moves into the town centre or a designated shopping district, where rents and rates are higher.

Topps Tiles credit insurance withdrawn but firm insists it will have little impact

18th February | flooring | Topps Tiles has played down the impact of one of its providers withdrawing credit insurance cover for its suppliers. The firm says it doesn’t believe ‘a material number’ of its suppliers rely on credit insurance and it doesn’t expect the decision to adversely impact the business.

Cotswold Company under threat as parent assesses brand's viability

17th February | direct | The future of the Cotswold Company is in doubt after its parent firm admitted it was reviewing the furniture retailer’s ongoing viability. The Cotswold Company is a multi-channel operation that trades via mail order, the Internet and four stores, as well as concessions throughout UK garden centres.......more

Pinetum and Karndean stung by celeb duo’s Imagine venture

17th February | supply | Wiltshire furniture manufacturer Pinetum was among a host of suppliers who lost money to Imagine Furnishings – the interiors fit-out firm, run by television presenter Anthea Turner and her husband Grant Bovey, which went into administration last year.

Home chain Laura Ashley issues profit warning

17th February | homeware | Like for like sales at Laura Ashley have fallen 6.2% in the year to 31st January, prompting the fashion-to-furniture retailer to warn that profits will be worse than expected.

Overall sales climbed just over 10% thanks to new store openings, but the combined impact of falling demand, heavy discounting, and the weak pound have contributed to the firm recording a profit before tax and exceptional items of £9m – lower than had been anticipated.

Ikea bosses lament UK planning law as new store opens with offers for former MFI customers

16th February | flatpack | Ikea is offering double digit discounts on its kitchen ranges as it looks to cash in on the market of collapsed retail chain MFI. The Swedish furniture retailer has also expanded the kitchen display at its new Southampton store, which opened last week, in order to profit from its rival’s closure.

It follows a number of the large DIY chains who promoted kitchens heavily in the wake of MFI’s problems late last year. Ikea’s new Southampton store is one of two planned for this year in the UK and Ireland – the other is in Dublin – but bosses say they still feel the UK can accommodate a dozen more stores. The retailer currently has 18 across the country.

However, they admit that UK planning law will continue to hinder new store development during its hunt for suitable stores in the right ‘strategic locations.’

Italian furniture sales to the UK collapse

16th February | imports | The volume of furniture British retailers are bringing in from Italy has declined sharply according to the Italian furniture trade body Federlegno-Arredo. Together with the United States and Germany, Britain represents one of Italy’s most important export markets, but all three showed steep falls during 2008.

Sofa Workshop vows to rebuild online sales and restore former glories

13th February | retail | Andrew Cussins says he will build ‘significant online business’ at Sofa Workshop and plans to eventually open stores in the north of England.

Sofa Workshop founder Cussins saved a third of the stores two weeks ago, after the firm went into administration earlier in January. He bought the company’s London stores and half a dozen others, the majority of which are in the south east...............more

Furniture Village climbs nine places in web ranking tables

13th February | online | Furniture Village has climbed nine places in the Sitemorse retail website ranking table for February. Sitemorse, a web consultancy, uses an automated system to rank retail websites across a range of usability and accessibility criteria.

36-store Furniture Village, which is currently running a 50% off sales promotion, climbed to fifth place in the rankings, overtaking ScS which dropped a place to 11th. DFS remains top of the rankings in first place, despite not having an ecommerce website. Department store Fenwick is in fourth place.

Gleneagle Furniture closes Welsh plant with the loss of 65 jobs

12th February | cabinet | Gleneagle Furniture is to close one of its two factories. The bedroom cabinet manufacturer will close its Welsh factory on the Cibyn Industrial Estate in Caernarfon with 65 employees losing their jobs.

The firm’s plant in Ireland, which employs 220 people, is unaffected and remains open. A spokesman for the firm stressed, ‘We have not gone into administration or anything like that and we will continue to trade.’

Visitor turnout close to 2008 levels at Las Vegas Market

12th February | exhibitions | Las Vegas Market is on target to match its visitor attendance figures from last year’s show. The biannual event came to within 2% of last year’s first day total on Monday – the first day of the show.

Carpet manufacturer plans to open factory shop

12th February | flooring | Adam Carpets hopes to open a factory shop. The Kidderminster carpet manufacturer has applied for planning permission to Wyre Forest District Council to change the use of one of its buildings at its Greenhill Industrial Estate site.

DeCoro staff receive Government payout following factory closure

11th February | upholstery | Staff at DeCoro’s Chinese leather upholstery plants have been given about £1m in unpaid wages by the local Government. The firm, which manufactured from two vast Chinese sofa factories, closed last month and started a voluntary liquidation process.

Homewares firm makes furniture move with Mandale acquisition

11th February | retail | North east homewares chain Collectables has bought Stockton retailer Mandale Fine Furniture. The acquisition moves the nine-store firm into furniture for the first time.

Singapore show to focus on young designers and promote sustainable production

11th February | exhibitions | Fresh design talent and eco-credentials will be to the fore at next month’s International Furniture Fair in Singapore. The show organisers have increased the size of its young furniture designers exhibition, dubbed Platform, to 800sq m and enlisted the support of top European furniture names such as Italy’s Magis as it looks to grow its reputation for top end design.

Furniture retail training firm slashes prices in recession busting initiative

10th February | training | The Furniture Training Company has introduced discounts of up to 70% off its retail sales training programmes. The US firm, which provides online courses aimed at furniture retail sales staff, says the ‘aggressive recession pricing will help retailers thrive during the global downturn.’

North west independent launches interior design service

10th February | value | Four-store independent retailer Alan Ward has launched an interior design service. The initiative is a partnership with Motif Interiors, and has been launched at Alan Ward’s Chester and Winsford stores. Motif’s soft furnishings, flooring and accessories are now on display in the two stores alongside furniture, with interior designers on hand to visit consumers' homes for style advice.

40 jobs go as upholstery supplier goes to the wall citing bad debts and ‘suicidal dumping’ by competitors

9th February | upholstery | Sofa manufacturer and importer Mack-Line has ceased trading with the loss of 40 jobs. John Mack, chairman, told the Furnishing Report that it had suffered a number of bad debts in 2008 with a host of retailers failing to pay the firm.

He also pinpointed ‘suicidal dumping’ by competitors. ‘There are three firms out there, and people in the industry know who they are, who are selling goods for 40% less than they should be,’ he said.................more

Seven-store Irish retailer goes into administration: two stores shut immediately

9th February | retail | Irish retailer Classic Furniture is in administration. The seven-store firm has appointed Kieran Wallace from the corporate recovery arm of KPMG as administrator and has already closed two of its stores, in Sligo and Navan.

Still room for independents in the future says retail think tank

9th February | consolidation | The prospect of a diminishing independent retail sector and a market dominated by the largest and most powerful retailers has been exaggerated, according to a collective of retail soothsayers.

The KPMG/Synovate Retail Think Tank, a retail industry panel, says niche players and smaller specialists can thrive as larger firms struggle to meet the changing challenges they face as they grow bigger.

Italian Government includes furniture in stimulus package

9th February | international | Italian consumers will receive tax breaks for buying furniture as part of a far reaching stimulus package aimed at reviving the consumer goods market in Italy.

Home furnishing failures halve in January as predictions of doom fail to materialise

5th February | failure | The mass cull of home furnishings businesses may be slowing after the number of firms to have collapsed dropped by almost half in January. 29 businesses in the UK home sector either went into administration or finished trading completely, down from 56 in December.

The medium term trend suggests December may prove to be the darkest month for the industry in the current downturn. December’s figure is almost double that of November (32) and October (35) and close to treble the number of firms to have failed in September (21).

Upholstery chain ScS sees 25% sales fall but insists it still remains ‘within a whisker’ of forecasts

5th February | upholstery | Half-year sales at sofa retailer ScS Upholstery have fallen by 25% to £99.5m. The chain, based in the northeast but with stores nationwide, was rescued by private equity firm Sun European last year after going into administration.

Speaking to the Mirror newspaper, finance director Ron Turnbull said that sales targets set last June had been ‘ripped up’ as a result of the credit crunch but that ‘the gratifying thing is we’re within a whisker of our revised forecasts.’ He added that no store closures were planned.......more

Year on year footfall rises in January but retail vacancies could rise to 15% as discounts negate improvement

4th February | shoppers | The number of shoppers in January climbed 1.2% compared to the same period in 2008, but any sales improvement off the back of more shoppers will be offset by the heavy discounting that attracted customers into stores.

Research firm Experian’s Retail Footfall Index showed January shopper numbers fell by almost a quarter compared to December 2008 – further evidence that pre-Christmas promotions are prompting shoppers to spend before the traditional January sales period.......more

‘Business as usual.’ House of Fraser moves to distance itself from Baugur

4th February | finance | Department store group House of Fraser has moved to quell speculation it will be affected by one of its investors, Baugur, filing for bankruptcy protection from its creditors. HoF chief executive John King said, ‘It is important to clarify the independence of House of Fraser and to emphasise that Baugur is a minority shareholder and has no impact on the strength of the business, or its day to day operations.’ Don McCarthy, chairman, added that it was 'business as usual.'

Value fashion chain to continue homewares expansion

4th February | homeware | The parent company of TK Maxx is to open its eighth dedicated home store. TJX Europe, which buys designer products in bulk and sells them at discounted prices, will open a HomeSense store in Cambridge’s Beehive shopping centre.

Leggett & Platt suffers as market demand weakens

4th February | supply | Component supplier Leggett & Platt has recorded a fourth quarter 14% fall in year on year sales for its products destined for use in residential furnishings. The firm is among the world’s leading suppliers to bedding and upholstery firms, but the $74m sales fall was not as bad as some of its other product categories.

EU moves to ban DMF and prevent more ‘itchy sofa’ issues from imports

3rd February | upholstery | The allergy-inducing chemical at the centre of the ‘itchy sofa scandal’ is to be banned from furniture imported into Europe. Last year, a number of high profile retailers including Land of Leather, Argos and Walmsleys were accused of selling leather sofas with mould preventing sachets containing dimethylfumarate (DMF) – a chemical said to have caused rashes and skin burns........more

Moores Furniture Group to target independents following brand and stock acquisition

3rd February | kitchens | Moores Furniture Group has bought the Lifestyle and Four Seasons brands from the administrator of failed kitchen group BGH. It hopes the purchase, which also includes some of the Lifestyle and Four Seasons' stock, will provide a route into the independent kitchen retail sector.

Carpetright plans more Sleepright concessions but can’t prevent sales falling

3rd February | flooring | Carpetright says it wants to open a dozen Sleepright stores in the final quarter of its financial year. Lord Harris, the group’s chairman and chief executive, said he was pleased with how Sleepright had fared since it was acquired by the Carpetright group in December, but warned that current trading conditions were the ‘most difficult at any time in my working life.’

Furniture component supplier goes into administration

3rd February | supply | Furniture component supplier BLP UK – which manufactures MDF profiles, mouldings and doors, is in administration. Corporate recovery outfit PricewaterhouseCoopers has been appointed and is running the firm with a view to selling it as a going concern.

Victoria Carpets issues profits warning but says it has increased market share

3rd February | flooring | Flooring supplier Victoria Carpets says its full year results will be ‘significantly below market expectations.’ The Kidderminster carpet manufacturer saw an 18.7% drop in UK like for like sales in the three months to December 2008, with Irish sales falling 28% compared with the same period in 2007.

Millionaire buys MFI stock and plans ‘guerrilla sale’ across 20 London stores and online

2nd February | retail | The founder of The Range - the 37-store home, leisure and garden retailer - has paid an undisclosed sum for the entire stock of collapsed furniture chain MFI. Chris Dawson, who started in business as a market trader in Plymouth, will sell the stock, believed to be worth £68m at retail prices, from 20 former MFI stores in London and via a website (www.mfistock.co.uk) which is already live...........more