Furniture & Furnishing News: July 2009
Two-store independent improves profit despite sales fall; Gross margin maintained
FURNITURE | INDEPENDENTS
West Midlands and Dorset retailer Cookes Furniture believes it will increase profits for the third successive year in 2010 as it continues to drive down costs.
IN BRIEF | 30TH JULY
Phoenix retailer pins faith on Woolies, MFI and LoL execs
The bosses of failed retailers Woolworths and MFI are among those hoping to turn around the fortunes of Allied Carpets – which was rescued in a pre-pack administration last week. Gary Favell (ex MFI) and Steve Johnson (formerly of Woolworths) may be joined by former Land of Leather finance director Clive Hatchard – who has also been linked with a role.
Modest kitchen turnover fall for Nobia
Revenue dropped 4% to £344.5m at Swedish kitchen manufacturer Nobia in the second quarter of the firm’s financial year. Profits fell from just over £20m to £3m. The firm said the lack of new build activity was partly to blame.
Dreams continues relentless sales growth; Bedstead imports help gross profit margin
BEDS | SALES
Retail giant Dreams is likely to take sales beyond £200m for the first time this year. The chain, sold to Exponent Private Equity by founder Mike Clare in March 2008, increased turnover 16.5% to £194.4m during the year to 31st December.
IN BRIEF | 29TH JULY
Consolidation in the bathroom sector
Ideal Standard has acquired the remnants of a failed Irish sanitaryware group. The Qualceram, Shires, Selecta and Trent brands will now all be produced by Ideal Standard, which said the purchase was a reflection of its international ambitions.
Leggett & Platt suffers 29% second quarter sales drop
Weak market demand caused spring supplier Leggett & Platt to suffer a 29% 2QF sales fall to $757m. The component firm did, however, say there were signs that some of its markets were stabilising, and that internal cost reductions would help it improve margins.
Ikea opens first Irish store
Ireland’s first Ikea store opened earlier this week. The 3,500sqm Dublin store attracted several thousand shoppers, the norm for an Ikea opening, but bosses said sales projections had been scaled back by about 15% because of the global economic downturn.
Cash shortfall prompted ScS pre-pack; Sun Capital invests £20m in sofa chain
UPHOLSTERY | CASH
The withdrawal of credit insurance and failure to renegotiate a bank overdraft compounded the economic woes that forced upholstery retailer ScS to court investment firm Sun Capital Partners for funding last summer.
JJO profit halves on £2.6m sales fall
CABINET | MANUFACTURING
Profits at bedroom and kitchen furniture manufacturer JJO have more than halved in the past year.
IN BRIEF | 27TH JULY
Home shopping retailer bids to raise cash through share issue
The retail group behind the now defunct furniture firm The Cotswold Company is to launch an £80m capital raising exercise. Home shopping group Findel will issue 200m shares by way of a firm placing and almost 205m shares through a placing and open offer.
Red tape costs small firms £12bn a year
Legislation covering health & safety, tax, employment law and the environment is losing small businesses 37 hours a month, and £12bn collectively each year. Those are the findings of a Forum for Private Business (FPB) survey, which is lobbying for change through the Government’s Regulatory Reform Committee.
Kitchen and bathroom trade struggle to find like for like insurance scheme after losing 100% coverage
KITCHENS | INSURANCE
The trade body representing the KBB industry is trying to find an alternative insurance provider for its members after its previous cover supplier withdrew to concentrate on its core business.
Manufacturing output remains under pressure as firms continue to run down stock levels
SUPPLY | CBI
Running down inventories remains the key focus for manufacturers with an economic recovery still viewed as being some way off.
South-West furniture independent plots expansion after rebranding stores
FURNITURE | INDEPENDENTS
Devon and South Wales retailer plans for growth following change of name from Furniture Warehouse to FW Home Stores.
IN BRIEF | 23RD JULY 2009
FSB hands over Keep Trade Local petition
The Federation of Small Businesses (FSB) has handed over a petition to Number 10, Downing Street in its bid to highlight the plight of small firms during the recession. The Keep Trade Local campaign has attracted 55,000 signatures.
Floor firm signs distribution deal
Wood floor supplier Lionvest has agreed a warehousing and distribution deal with Meachers Group. The logistics firm will collect containers from ports, stock them in its warehouse before carrying out onward delivery to customers.
Destocking harms Walker Greenbank sales but stability returns to brands
FABRICS | SALES
Luxury soft furnishings group Walker Greenbank expects sales to be down 12.5% in the first half of its financial year – as its customers continue to run down stock levels.
Next reiterates furniture intent; 13 Home stores to open this year
HOME | EXPANSION
Variety retailer Next will confirm its desire to master the furniture and homeware sector by opening a further 13 Home stores this year – three more that it had previously announced.
IN BRIEF | 21ST JULY
DIY chain agrees concession deal with Carpetright
Flooring chain Carpetright will open concessions in Focus as the DIY retailer looks to increase revenue from underperforming stores. The first stores are in Alton, Hampshire and Bishops Stortford, Hertfordshire. Focus has freed up 100,000sq ft across its store portfolio for concessions and downsizing.
Argos prepares to raise prices in new catalogue
Multichannel retailer Argos launches its new catalogue tomorrow (22nd July) with prices expected to have risen by as much as 5%. The chain, Britain’s largest furniture retailer by sales volume, sources much of its goods from China and has been hit hard by the weakening of sterling against other currencies.
John Lewis steps up modern offer; Recruitment drive for Poole home store
FURNITURE | RETAIL
Department store retailer John Lewis will put modern furniture at the heart of its strategy with the introduction of four ‘designer’ brands this Autumn.
Case goods firm sees losses rise on 28% sales fall in Q2
CABINET | INTERNATIONAL
US firm Stanley Furniture saw sales fall almost a third to $42.3m in the second quarter of its financial year.
Upholstery and cabinet sales rise for York independent, but profits fall
INDEPENDENTS | FURNISHINGS
Profits at 50,000sq ft furniture store Rodgers of York fell by almost 85% in the year to February. The home furnishing firm’s pre-tax profit dropped to £53,000 compared to the £350,000 it made in the previous year.
Danish furniture retailer bids to go national with more stores planned for 2010
RETAIL | EXPANSION
Furniture and homeware retailer Jysk is expected to double its UK store numbers by this time next year. The Danish chain, which has four UK stores, all in the North and East Midlands, will roll out further shops in the early part of 2010.
Bathroom market to sink 9% in 2009
BATHROOM | SALES
The bathroom furnishings industry will have to wait two more years before growth returns to the sector, with sales expected to drop by 9% this year.
Reid commits further cash to SPL club through sponsorship deal
RETAIL | MARKETING
Scottish retail chain Reid Furniture has extended its sponsorship deal with SPL side Hamilton Academical and has taken over from the Morris Furniture group as shirt sponsor for the 2009/10 season.
Icelandic banking crisis hits furniture retailer; £2.5m written off
INDEPENDENTS | RETAIL
One of the North’s most profitable furniture retailers has written off an Icelandic deposit of almost £2.5m.
Flooring collective to disband after failing to gain consumer acceptance
LAMINATE | QUALITY
A trade body set up to provide a quality mark for laminate flooring is to disband after its Certified European Laminate Quality (CELQ) seal failed to penetrate the consumer market.
Sunshine turns the heat up on furniture retailers, says BRC
RETAIL | SALES
The good weather in June meant furniture and flooring stores suffered, according to the British Retail Consortium’s latest monthly sales figures.
Headlam half-year sales drop 8.2%
FLOORING | SUPPLY
Sales at flooring group Headlam fell 8.2% in the six months to 30th June, with like for like revenues dropping 10.7% in the UK. Sales in continental Europe were buoyed by the contribution of its recent Dutch acquisition, Silvester, resulting in an overall 7.4% non-UK climb.
Like for like sales jump 5% for value soft furnishings retailer; Overall sales pass £400m
HOMEWARES | SALES
Soft furnishings chain Dunelm Mill increased like for like sales by 5% in the six months to 27th June. Overall sales in the 26 weeks climbed 10.7% to £215.2m.
Sales flat at bespoke furniture supplier Neville Johnson
FURNITURE | VERTICAL
Fitted furniture specialist Neville Johnson has seen sales fall 2.5% to £16.5m in the year to April 2009 – ending a cycle of peaks and troughs for the firm.
Phoenix kitchen firm emerges with support of its Italian supplier despite massive debt
KITCHENS | RELAUNCH
The UK sales arm of a luxury Italian kitchen manufacturer says that new investment can help the firm succeed at the second time of asking.
AIS buying group launches online bed promotion
BEDS | MARKETING
Associated Independent Stores has launched a bed promotion through its Internet consumer portal – www.whatfurniture.co.uk. The buying group campaign features half price offers from bed manufacturers including brands such as Sealy, Slumberland, Myers and Relyon through selected stores.
DFS and Duresta throw weight behind revamped WCFM Retail Training Course
RETAIL | TRAINING
Two of the largest firms in the UK furniture industry are to host the relaunched Retail Training Course, organised by the Worshipful Company of Furniture Makers.
New wood and laminate flooring store brewing in Burton-upon-Trent
FLOORING | LAUNCH
A new flooring business is to open in Staffordshire next month. Floor Ur Home will become the largest wood and laminate flooring retailer in the area and will occupy the former Fires 4 U site on Northside Business Park.
5000 job cuts not enough; Ikea founder says bosses should have heeded expansion warning
FLATPACK | JOBS
Furniture retailer Ikea will need to make more redundancies despite having recently shelved 5,000 jobs across the world.
Repair firm launches new company aimed at leather market
WARRANTIES | LAUNCH
Furniture repair firm Multiserve is to launch a new leather warranty company at the Manchester Furniture Show this month.
Dorlux accused of scaremongering by trade union as bed firm warns it may collapse again
BEDS | LEGAL
More than 100 workers at Dorlux Beds (UK) were threatened with dismissal in the run up to an Employment Tribunal that went on to award them 13 weeks’ pay for the company’s failure to inform them of a change in management.
Reassurance at the heart of Sterling Furniture Summer Advertising Campaign
INDEPENDENTS | MARKETING
Scottish retail group Sterling Furniture is to put value and trust at the head of its Summer marketing. The major independent will use the tagline ‘Take Comfort’ across all advertising – including a television campaign put together by ad agency The Union.
Watch the television advert here
Habitat plans Autumn web launch with furniture on sale from September
FURNITURE | ONLINE
Furniture retailer Habitat is to launch its first transactional website this Autumn. Furniture will go on sale from September, with other goods, such as home accessories, planned to be available by Christmas.
Wade Group turnover grows to £71m but operating losses rise too
FURNITURE | RETAIL
Consolidated accounts for Multiyork and Feather & Black parent show turnover has risen again – to £71.02m from £70.49m – but operating losses increase to £2.26m from £0.55m the previous year.
Northern Ireland tile manufacturer goes into administration
FLOORING | ADMINISTRATION
Tile manufacturer Reflex Mouldings is in administration. The County Armagh firm employs more than 70 people and manufactures floor tiles for both residential and industrial use.
Floor firm cops flak from online blog and attracts Trading Standards investigation
FLOORING | INVESTIGATION
A Yorkshire flooring company that owes thousands of pounds to suppliers and customers is being investigated by Trading Standards and pilloried on the Internet by its alleged victims.
Home sales flat for Marks & Spencer
GENERAL | RETAIL
Marks & Spencer's furniture and homeware sales rose 0.1% in the 13 weeks to 27th June. Overall UK sales for the variety retailer climbed 1.7%.
Bed firm Hyder Living relaunches website
MARKETING | BEDS
Hyder Living has updated its website using lifestyle imagery of its beds, bunks and sofabeds as it looks to drive consumers to retail stockists.
B&Q launches £1m kitchen ad campaign; Promotes own brand
DIY | MARKETING
B&Q has launched a £1m advertising campaign promoting its own brand kitchens – Cooke & Lewis – across the ITV television network.
