FDM
AVES’ WORLD
fdmonline.com
John Aves
john@designdiscoveries.net
A time of great
oppor t u n it y
●
Many successful
companies have
made their
greatest strides
during economic
downturns.
Have we reached the bottom
of the economic cycle for the
residential cabinet, building
and furnishings industry? Our readers
are already making appropriate adjustments to expense budgets and cash
flow. But, perhaps this is also a time of
great opportunity.
Reducing expenses and overhead is
an unavoidable first step. No manager
wants to cut his departmental budget,
and no one wants to cut his own salary,
therefore few will be candid about
sales forecasts or staff requirements. For this reason, it
may be helpful to retain
an outside consultant
for some objective
evaluations. The
tactic is to cut costs
but the strategy in a
declining market is
to win business away
from competitors
and prepare for a new
growth cycle.
This might not be a
good time to stop imagining
new marketing ideas, new designs,
and new manufacturing efficiencies.
for in months and years ahead.
Smart companies invest in marketing and design in the worst of times.
Advertising is one obvious and easily
measured sign of marketing activity.
Successful companies have been appearing regularly for many years, through
growth markets and retrenchments.
Baker Furniture and Henredon
have both appeared consistently in the
pages of House and Garden , Architectural
Digest and Interior Design every year,
through periods of boom and bust, for
at least 50 years.
Market leaders such as
Robb & Stucky at the
high end of the market
and Ashley Furniture
in the mid-market
have announced
that they plan to
continue their
strategies of open-
ing new stores. They
will use this retrench-
ment as an opportunity
to solidify and protect
the dramatic market gains
they have made in the past ten
years. When consumers are ready to
start buying again, they will be ready.
Action steps
required
➤ Reduce overhead
➤ Go outside for good financial
advice and forecasts
➤ Make a plan to gain market share
by being better prepared for
the next growth cycle
●
New leaders emerge
Many successful companies have
made their greatest strides during
economic downturns. It is a time when
the relative void of positive messages
within our industry makes creative
ideas and messages more easily
noticed and more appreciated. Like a
bird song in winter, it is a time when
furniture dealers, real estate agents,
builders and consumers are looking
for hopeful and brighter ideas to strive
A different approach
During the recession of 1979-1983
existing homes sales dropped 53 percent. The furniture industry declined
sharply, and many companies retreated into a defensive posture. It was a
time when our industry naturally tried
to defend itself and preserve capital.
Many companies erased marketing
programs from their plans and cut
