A discussion of the current situation and future trends in retail fixturing - Management Leadership Series - Dave Mueller, Jeff Uhri - Interview

DSN Retailing Today, July 7, 2003

The economy is down, so why are these two men so upbeat about the prospects for retailing, the fixturing industry and the company they work for? Find out as we talk with Dave Mueller and Jeff Uhri from industry leader, Leggett & Platt Store Fixtures Group.

Dave Mueller, President, and Jeff Uhri, Executive VP of Sales for Leggett & Platt Store Fixtures Group.

Q When retail is good, so is the fixturing business. What's the sense that you get from your customers about the outlook for retailing in the coming year?

Dave: Keep in mind that consumer spending has remained relatively strong compared to the rest of the economy We're also seeing a little improvement quarter by quarter, and our value retailers are actually doing quite well. As a result, the industry is looking at total fixture sales to remain at last year's levels.

Jeff: We're also looking at a shift in retail budget allocations, with more money being spent on new store openings and less on renovation. And while some are hunkering down, others believe it's important to revitalize their brands during tough times.

What are some of the challenges that retailers will face this year, and what is your industry doing to help them manage through these difficulties?

Dave: Now more than ever, retailers are looking to get more value from their partners. I can't speak for the rest of the industry but we're working with our customers to find innovative ways to cut manufacturing and freight costs and maximize their fixturing dollar.

Jeff: One of the most significant changes is that a number of our competitors have closed their doors. While we have the capacity and the resources to meet the needs of our customers at Leggett, I think you're going to start seeing longer lead times in the industry.

Dave: We also empower our project managers to utilize the personnel, facilities and resources they require to ensure that each job goes as smoothly as possible.

Q Has the business climate changed what retailers are looking for in a fixturing partner?

Jeff: Definitely. The shakier the business climate is, the more buyers look for a solid partner. However, most fixture companies are privately held so verifiable financial data is difficult to come by.

Dave: Leggett & Platt is one of the few publicly traded fixturing companies. We're a Fortune 500 company with over 30 branches, so we have multiple competencies and can keep an entire job within our facilities, while our competitors must outsource what they are unable to do in-house. We have three times more manufacturing space than our nearest competitor -- that gives us flexibility to ensure we can deliver on time and as promised ... cut transportation costs ... reduce time-to-market ... and serve national accounts at the store level.

Q Speaking of support, a lot of businesses are downsizing which puts a lot more responsibility on the shoulders of fixturing buyers. How is the industry responding to this trend?

Dave: Again, I can't speak for our competitors, but Leggett & Platt recognized that businesses were streamlining and outsourcing more responsibilities. We anticipated this trend and put the people in place to offer a complete range of services. From initial concept design through installation, we'll work with the customer in any capacity to make sure the vision they have for their store becomes a reality.

Q What are your customers doing differently today than they were five years ago?

Dave: First, our customers are looking for flexibility in fixture design. They want to be able to adapt and change their stores economically -- to create a fresh look so they can respond to an ever-changing marketplace. Secondly we're seeing a convergence in what used to be two distinct departments: fixturing and visual merchandising. Retailers are recognizing that they can have more control over their brand through the synergy of fixtures and signage.

Jeff: Not coincidentally Leggett & Platt is ideally positioned to meet this trend. We have tremendous resources and expertise in every aspect of fixturing and visual merchandising. And we can bring it all together into one cohesive solution that reflects the customer's brand. To my knowledge, we're the only ones offering a comprehensive turnkey solution through a single point of contact.

Q What are the attributes of the companies that are most likely to be around next year -- and even ten years down the road?

Dave: First and foremost, financial strength and all that it entails -- manageable debt, a profitable operation, and the ability to invest in new technology plants and equipment.

Another factor is service -- providing expertise from the start of a project to the end and beyond, and sticking to commitments. We are getting a lot of new customers because they're realizing that they don't have to accept delivery delays as the status quo.

Jeff: Breadth of services and products is also essential. Retailers have diverse needs, and a company can be too specialized. A successful fixturing business will have to offer customers a single source solution.