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Furniture store sales hit $1B mark again in September

4 December 2017
By the Numbers

OTTAWA – Furniture stores rang up their fourth consecutive month of sales over $1 billion in September, setting what is probably a new high in this post-recession period, although they were down slightly from August, according to the latest figures from Statistics Canada.

For the month, furniture store sales were just over $1.04 billion, up slightly from the $1.03 billion rung-up in August and a 7.0% gain from the $977.1 million sold in September 2016. For the third quarter of 2017, furniture store sales set a new record high of $3.08 billion.

For the first nine months of the year, sales were $8.49 billion – up 6% from the $8.01 billion for the same period of 2016. For the trailing 12 months ending September 30, furniture store sales were pegged at $11.5 billion, up 6% over the comparable period.

It should be noted this gives Leon’s Furniture Limited – this country’s largest full-line furniture retailer – an overall market share of 23.8% for the first nine months of 2017, based on its total system sales of $1.91 billion.

The only retailer coming close to Leon’s in terms of market share is IKEA Canada, whose market share is roughly 19%.

Meanwhile, home furnishings stores – which sell everything from floor covering to lamps and lighting, decorative accessories and wall art – saw its September sales (actual, not seasonally adjusted) pegged at a preliminary $599.6 million, up marginally from August. They were up 0.7% from the $595.5 million rung-up in September 2016.

For the third quarter, sales totalled $1.75 billion, down 2.1% from last year’s $1.79 billion.

For the first nine months, sales were $5.0 billion, up 1.8% from $4.91 billion for the comparable period of 2016. For the trailing 12 months ending September 30, home furnishing stores sales were estimated at $7.0 billion, a gain of 2.1%.

Electronics and appliance stores also appeared to be having a growth spurt through the third quarter and the opening nine months. Sales in September itself were a preliminary $1.47 billion, which while down slightly from August, was up 7.3% from $1.37 billion in September 2016.

For the third quarter, sales totalled $4.17 billion, up 8.2% from the $3.86 billion for the same period last year. For the year-to-date, these merchants saw sales of $11.6 billion – a gain of 11.3% from the $10.4 billion a year ago.

For the trailing 12 months, sales were $16.6 billion, advancing about 8.8%.

Renwil opens Montreal DC

4 December 2017
Manufacturing, Products

MONTREAL – Home décor resource Renwil has opened a new 100,000 square foot state-of-the-art warehouse and distribution centre here, part of its ongoing plan to grow its business across North America.

“Over the past 15 years, we have transformed Renwil from being a local manufacturer to an import business,” Jonathan Wilner, second generation president of the family-owned enterprise told Home Goods Online in an interview. “We used to be a wall decor company and have grown the business by going into different product categories.  We are now designing and manufacturing art, mirrors, lighting, accent furniture, rugs, bathroom products and accessories.”

Jonathon Wilner (right), president of home décor resource Renwil is seen here at the opening of the company’s new Montreal distribution centre with his brother Ryan Wilner, who serves as president of Renwil Hospitality. He noted over the past 15 years, Renwil grew into two buildings on six floors. “We have now opened a 100,000 square foot distribution facility with 33 foot high ceilings and racking with four levels,” he continued, adding they’ve also invested in a new computer system as well as an automated warehouse management system that’s able to ship a retailer’s order in two or three days.

The need to build the new facility was driven by the simple fact that over the past five years, Renwil’s business has quadrupled, Wilner said, adding it now serves about 4,500 retailers across North America. The facility will also support the Renwil’s four showrooms, including two in Canada – Montreal and Toronto – and two in the United States – Las Vegas and Dallas.

It contains approximately 1,300 SKUs, with more than 120,000 units stored in some 5,500 pallet positions covering Renwil’s entire category assortment from art and mirrors to accent furniture, rugs and bathroom products.

Wilner was also quick to note while Renwil has been bridging the gap between the art world and the commercial marketplace since its founding in 1967, the “heart of the organisation” has not changed: a 3,500 square foot studio where the company’s ten in-house artists experiment with materials and styles that are then developed into affordable works of art.

“We have beautiful designs. In order for us to capitalise on getting these beautiful designs to our clients, we really needed the backup and the support of the right logistical system,” he noted.

The new facility is totally operational, with some outbound shipments being sent to the retail network using Renwil’s two new 53-foot trucks. The new Warehouse Management System, equipped with wall-to-wall, four-level racking is also helping to shorten shipping times while increasing product availability.

“This was a very big investment in software and equipment,” Wilner said. “This investment was important because logistics and service are key in business today.”

Paquette elected to QFMA board

QFMA president Pierre Richard (left) is seen here with Alexandre Paquette of Trica Furniture, who was elected to the association’s board of directors are its recent annual general meeting.
4 December 2017
Manufacturing, People

MONTREAL – Alexandre Paquette was elected to the Quebec Furniture Manufacturers Association board of directors at its recently-ended annual general meeting and conference.

Paquette is director of finance and administration for Trica Furniture, the Saint-Jérôme, Quebec-based manufacture best known for its assortment of bar stools and seating. He succeeds Claude de Lanauze of Hettich, who served on the board for a number of years.

The other members of the board for the coming year include:

  • Michel Deveault, president of casual dining powerhouse Canadel;

  • David Fontaine, executive vice president of glider rocker and youth furniture maker Dutailier;

  • David Gélinas, executive vice president of specialty mattress producer Zedbed;

  • Théodore Homa, general manager of contemporary upholstery house G. Romano;

  • Jean-François Nolin, president of contemporary case goods producer Huppé;

  • Réjean Poitras, president of metal furniture specialist Amisco;

  • Patrick Selmay, president of case goods maker Mobican;

  • Charles St-Louis, president of Bois & Design, a specialty and bespoke case goods maker based in Trois-Rivières;

  • Martin Tardif, director of engineering for ready-to-assemble specialist Bestar;

  • Guy Tousignant, president of Matelas Mirabel, the licensee for the King Koil and Restonic brands in Quebec; and,

  • René Vincelette, vice president of human resources for contract furniture maker Groupe Lacasse.

Directors are elected for one year terms.

Réjean Poitras is the current chairman of the QFMA board of directors. David Gélinas is vice chairman.

Confidence up in November

4 December 2017
By the Numbers

OTTAWA – Pushed by strong labour market growth, the Conference Board of Canada saw its Index of Consumer Confidence reach the second highest level since 2007 last month and is an average of 17% in 2017 over 2016, one of the highest yearly improvements since it was started.

The board pegged November’s index at 121.1 (it was set at 100 in 2014).

“However, there is some cause to believe optimism will weaken as Canadians continue to grapple with rising debt loads and their ability to fund major purchases,” board economist Cory Renner said in his report. “After soaring through the first half of the year, durable good purchases are likely to slow; optimism about future purchases is therefore a key indicator to track.”

He noted there are two factors that could affect spending over the coming year: interest rate hikes and a slowdown in employment gains. “The Bank of Canada rose rates twice this past summer and the Conference Board expects three more rate rises by the end of next year,” Renner said. “Yet so far, this has not affected consumers’ willingness to purchase major items, with 33.5% of respondents answering favourably in November to questions about making major purchases, up 4.5 percentage points from the same period last year.

“Households also remain positive about their job prospects,” he continued, adding, “Nationally, 71.6% of respondents said their job prospects would improve or stay the same over the next six months. This is up from 62.8 per cent the same time last year.”

Despite the optimism about job prospects and a pick-up in wage growth (wages grew by an annualised 3% in October), the report said households were less optimistic about their future finances: 22.6% of households believe their finances will improve over the next six months, down from 24% last month.

The most interesting news coming from Ontario is the impending minimum wage hike and its effect on overall confidence in the country. “Ontarians’ consumer confidence declined by 1.7 points in the most recent survey, continuing a downward trend seen over the last four months,” Renner said, adding, “Ontarians had a more positive outlook for future employment, with 13.6% of respondents believing their employment prospects will improve over the next six months, up from 12.0% in October.

“But although Ontarians were optimistic about employment, their views about current and future finances fell,” he continued. “In Ontario, 21.4% of respondents believe their future finances will improve over the next six months, down from 23.9% in October.”

Meanwhile, the index in Quebec rose 14.1 points in November, reaching its highest level in well over a decade. People in Quebec continue to be especially optimistic about major purchases (the highest positive response rate in Canada), and views about future employment and finances are above the national average.

Albertan’s confidence surged by 8.4 points in November, Renner said, pointing out the province’s index is now at its highest level since the end of 2014. “Albertans are especially more optimistic about the future, with positive response rates to expectations about future job prospects and future finances surging,” he remarked.

The index for British Columbia rose 10 points in November, the second consecutive double-digit increase. British Columbians are expecting employment to rise, as 15.9% of respondents believe their job prospects will improve in the next six months, up from 12.6% last in October. “Views about making major purchases have also improved, reaching their most optimistic level since 2007, despite concerns about housing affordability in the province,” Renner reported.

The Saskatchewan–Manitoba index was one of three to decline in October, though it remains elevated compared with the last 16 months. People in the region continue to have below or significantly below average response rates for all four questions (about current finances, future finances, job prospects, and major purchases).

Volatility remains in the Atlantic Canada index, which declined by almost 10 points in November for the fourth time this year. “The Atlantic provinces continue to struggle, with economic growth well below the national average,” Renner pointed out.

The Conference Board conducted its online survey of some 3,000 Canadian adults between November 6 and 16, 2017.

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Home Goods and its accompanying newsletter - HGO This Week - covers the furniture, bedding, appliances, consumer electronics, accessories, lamps and lighting and floor coverings product sectors of the big ticket home goods market in Canada. HGO is also a forum for the dissemination of market research and hard-hitting articles on best practices for Canadian retailers.

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