Regionals cash in on popularity of RTA - ready-to-assemble furniture - RTA Merchandising

Discount Store News, Oct 19, 1992

Nationwide DSN Report

Regional chains are among the leading innovators in the discount industry when it comes to developing new ways to merchandise ready-to assemble furniture in a way which is both eye-appealing and easy to shop. Many have found RTA to be a strong sales and profit center, and have used new store prototypes to explore increased assortments or novel RTA skus.

Venture, for instance, gave more space to RTA in stores since the October 1991 prototype openings and now devotes over 2,000 sq. ft. of store space to lifestyle furniture. The generous department size has also enabled the chain to introduce a product not sold at full-line discounters in the past: a convertible futon sofa bed for $199.

In Ames' new stores, square footage devoted to the entire home furnishings area -- inclusive of RTA, ceiling fans and lighting -- is about double what it is in other stores, according to James Aglio, vice president, merchandise manager with Ames.

In its new stores, Ames has also found a novel solution to creating an attractive RTA display while still keeping the boxed stock available for self-service. Well-accessorized room vignettes are separated by an aisle in which boxed goods are stocked. The boxed goods are not immediately visible, which puts the spotlight on the floor-level displays.

"There's a big difference displaying RTA in lifestyle settings," in terms of sales, Aglio said. "This display cleans up the look a lot. We tried it a lot of different ways. But as we roll out the prototype, we will put in all the chanmges we have here. This setup more than doubled our sales."

Further changes would involved the possible expansion of kitchen and home office furniture, and a general upgrade of quality, especially at the prototype locations, Aglio said. At High Point he will be "looking at taking RTA to the next level of quality."

The lifestyle furniture assortment at Ames is rounded out with a selection of private label pieces, both in small wood occasional tables and in items like metal children's beds. Additional private label goods, which could include some solid wood imports, are also being considered for this spring but, Aglio cautioned, "Our mission isn't to switch too much to private label." Ames also sells rocker recliners in the new format stores and has eliminated some of its bar stools and chairs to free up additional space for home office furniture.

Aglio said right now the two hottest sellers are white and white with a natural wood trim. Ameriwood lines are the best-selling by vendor.

But not all regionals have found that adding square footage to the department will help its overall return on investment as a department. At Rose's Stores, president George Jones said the department had become over assorted and the chain is gradually clearing out some items. The average department size, going forward, is 105 linear feet, a decrease of 23% from 140 feet at the start of 1992.

John Phillips, Rose's buyer of imported and domestic furniture, said the reduction in skus eliminated overlapping price points and sharpened the assortment into a good-better-best mix. The chain's primary vendors continue to be O'Sullivan, Sauder, Armstrong, Souther Wood Products and Charleswood.

While Phillips does not expect that further changes in the assortment will be made to the department in the near future, he will be attending the International Home Furnishings Market this week, scouting for new skus which would fit into the current approach to RTA.

Like Ames, Phillips said the future could include slightly more direct-import RTA, which already constitutes about half of his buying.

Unfinished furniture, while typically merchandised in the hardware department and not with RTA, is a growing furniture business at a number of regional chains, including Caldor, Venture, Meijer and Fred Meyer.

At Bradlees, for instance, a large assortment of unfinished furniture called Pine Mountain from Khoury Inc., is now available chainwide, and in the newly remodeled stores, a new mix and match Colonial Wall Grouping is being added to the Pine Mountain assortment.