By Ray Allegrezza on 5/21/2020
Original Article here: https://www.furninfo.com/furniture-industry-news/11849
If there was ever any doubt regarding the severity of Covid-19 on independent home furnishings reps, a just-released survey from market research leader Leflein Associates confirms the toll the virus is having on their businesses.
According to the just-released survey, taken by Leflein among 422 members of the International Home Furnishings Representatives Association (IHFRA), virtually all of them—99.8%–admitted losing income, with the average loss coming in at a staggering 73%.
And while more than half—54%–said that their customers have called to cancel orders, a larger number—60%–have reached out to place orders. And while some of the orders being placed are likely to be re-orders, the fact remains that orders are once again being placed.
Not surprisingly, as consumers continue to abide by stay-in-place recommendations, online sales, already brisk, have continued to spike. In fact, one-quarter of the IHFRA reps participating in the survey acknowledge that online sales of furniture and related home accessories have kept them afloat as they struggle to navigate the unchartered waters caused by Covid-19.).
When asked to identify online sales of specific product categories keeping the reps afloat, standout categories were accessories (35%), bedding (31%), home office (27%), outdoor furniture (25%), case goods (23%) and upholstery (22%).
Unfortunately, e-commerce- the very platform keeping reps afloat, is out of reach for the majority of the reps polled. According to 40% of the respondents, their suppliers don’t have a significant e-commerce platform. For an additional 35%, their suppliers do not allow them to participate in e-commerce sales.
With their incomes severely restricted, 70% of the respondents said that they have turned to government assistance to tide them over. A majority—52%–reported applying for relief from the Paycheck Protection Program. For just under 20%, the short-term solution has come in the form of unemployment.
With many retailers still not anxious to have face-to-face visits, the vast majority of the reps responding to this survey have opted to communicate with their customers via email, the answer given by 95% of the reps. Reaching out by phone was also a preferred method that reps relied on, with 90% indicating using this method.
Worth noting is that video calls, the method closest to pre-Covid sales calls, is only being used by 28% of the respondents. Additionally, while virtual showrooms are being used more often as a result of the virus, the vast majority of reps—70%–only deem them to be somewhat effective. Another 12% say they are not useful at all, with the remaining 18% believing virtual showrooms to be very useful.
The survey also underscored the notion that reps believe the virus will not have an overly adverse impact on the future of their suppliers. When asked what proportion of the suppliers they represent were likely to go out of business, the respondents said only 10% would.
And if the reps insights are on the mark, business should open up this summer. Specifically, they pointed to August as the month when business should open back up.
According to IHFRA’s executive director Ray Allegrezza, “Having a market leader such as Leflein take the pulse of our members gives us and the industry truly invaluable insights and information not available anywhere else. Now, armed with this timely information, we can effectively formulate strategies to help our members as we all work through this pandemic.”
“And strategy is key to winning back the business for reps, manufacturers and retailers.” According to Barbara Leflein, President of the research firm who conducted the survey, “We found that nearly half of the reps reported that retailers have contacted them to discuss next step strategies.” What better way to consult with retailers than to research the end consumer and how she’s changed her buying habits and expectations.”