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Walsh named COO as LFL unveils new senior leadership team

28 September 2020
People, Retail

TORONTO – Leon’s Furniture Limited (LFL Group), parent to this country’s largest full-line furniture retailers, has reorganised its senior leadership team and has named retail veteran Mike Walsh as president and chief operating officer. He will assume his new post Wednesday (October 1, 2020).

For the past five years, he has been president of the Leon’s Furniture division of the company. He was the first non-member of the Leon family to hold the post and came to the retailer after a lengthy career at Canadian Tire Corporation where he ended his tenure as vice president of national store operations and support.

Edward Leon will continue as LFL’s chief executive officer, the role he has held since October 2018. He is also a member of LFL’s board of directors.

LFL Group recently named a new senior management team. From left to right are: Darci Walker, vice president of operations for The Brick; Danny Leon, vice president of merchandising for the Leon’s division; Leon’s division president Graeme Leon; and, the new president and COO of the LFL Group, Mike Walsh.Succeeding Walsh as president of the Leon’s Furniture division will be Graeme Leon. The 40-year veteran of the publicly held but largely family managed retailer has served as the division’s vice president of merchandising for the past five years. Before that, he was the division’s national store operations manager.

The division’s new vice president of merchandising will be Danny Leon, formerly vice-president of operations for LFL’s Brick division where he also served as vice president of merchandising.

Darci Walker has been named vice president of operations for The Brick. In a statement, LFL said Walker brings 38 years of experience across several operational functions at The Brick to her new role. Most recently, she served as senior director of distribution, where she was instrumental in developing a shared services model for distribution in Delta, British Columbia. Her appointment was effective on September 1, 2020.

“LFL has always maintained a commitment to the long-term development of its associates and to providing consistently challenging opportunities for everyone within the Company, and so it is always a pleasure to announce the progression of hard working professionals to senior management positions within the Company,” LFL chief executive officer Edward Leon said.

“Each of the individuals here has made a substantial contribution to the operating and financial results that LFL has generated over the past several years, by ensuring that our product strategy and distribution networks work together to ensure an unparalleled experience for our valued customers, coast-to-coast,” he continued, adding, “I am confident that LFL has one of the best and most seasoned teams in Canadian retail, with a tremendous level of knowledge, leadership and expertise that will continue to translate into great customer experiences and solid shareholder returns, for many years to come.”

Leon’s Furniture Limited operates 304 stores across the country under six banners: Leon’s; The Brick; Brick Outlet; The Brick Mattress Store; Midnorthern Appliance; and, Appliance Canada banner. It also operates e-commerce sites at leons.ca, thebrick.com and furniture.ca.

Related Story: Leon’s opens sixth B.C. store in Kelowna shopping centre

Related Story: 2Q earnings surge for LFL as pandemic drives down sales

Related Story: The Brick adds three stores in Atlantic Canada

Store sales climb in July

28 September 2020
By the Numbers, Retail

OTTAWA – The latest figures released by Statistics Canada reveal furniture store, home furnishing store and electronics/appliance store sales continued to make monthly gains in July as the economy slowly re-opened across of the country. However, the negative impact from the pandemic is still very much in evidence and many leading economists remain concerned about whether this momentum will be sustained in the coming months.

It should be noted the Retail Trade Survey measures the performance of brick-and-mortar stores and does not include sales generated by the pure play e-commerce merchants such as Article, Rove Concepts, Goodmorning.com or Endy.

The national bean counter set July 2020 furniture store sales at a preliminary and actual $1.20 billion, up 12.8% over the $1.12 billion rung-up in June and 7.2% higher than the $1.06 billion in July 2019.

For the opening seven months of 2020, total furniture store sales were set at $5.74 billion – 13.1% lower than the $6.90 billion for the comparable period last year.

In his analysis, the Toronto-based retail consultant Ed Strapagiel noted furniture store sales for the trailing 12 months ending July 2020 were $11.0 billion – down 6.3% from the $11.7 billion for the same period ending July 2019, a real indication that the sector is entering a period of slower growth.

Home furnishings stores – which sell everything from accent and occasional furniture to decorative accessories, lamps, lighting and floor covering – had preliminary sales of $591.7 million in July, an 11.4% gain over the $531.2 million sold in June but down 2% from the $603.9 million sold in July 2019.

For the year-to-date, merchants in this category – which includes HomeSense, a division of the U.S. based TJX Corporation – had collective sales of $3.01 billion, a 22.7% decline from the $3.89 billion rung-up for the comparable 2019 period.

The latest figures from Statistics Canada revealed furniture, home furnishings and electronics/appliance store sales were up month-over-month in July 2020.For the trailing 12 months also ending in July, home furnishing store sales were $6.2 billion – down 12.7% from $7.1 billion.

Meanwhile, electronics/appliance store sales were set at $1.17 billion for the month of July. This was up 4.8% from the $1.12 billion sold in June and up 10.1% from the $1.06 billion in July 2019.

These merchants seem to have lost the least ground during the pandemic shut down as many of the retailers in this category – such as Best Buy Canada and Visions Electronics – all have robust e-commerce platforms, whose revenues are included in this survey. For the year-to-date, electronic/appliance sales totalled $6.91 billion, a 1.2% gain from the prior year’s $6.82 billion.

As with furniture and home furnishings stores, electronics/appliance stores are also seeing slowing growth. At $13.8 billion for the trailing 12 months ending July 2020, these merchants saw decline of 7.4% over the comparable period’s $14.9 billion.

In a comment to Home Goods Online, Strapagiel noted, “Sales came back but I don’t know if I'd call it ‘strongly’ yet. It could be just latent demand – people catching up on delayed needs. It might go on for a few months but maybe not for the rest of the year.

He also cautions that the current high levels of unemployment will force a continuing decline in consumer confidence, which will continue to be one of the more significant drivers of furniture, mattress and major appliance sales in the coming months.

Bennett’s opens in Kingston

28 September 2020
Retail

Opening a new store for any established retailer is a multi-year process. Whatever else it is, it’s also an act of faith in the future of the business. That’s part of the rationale behind the move by Bennett’s Furniture & Mattresses to open a third location in Kingston, Eastern Ontario’s largest and most important city. Located in what used to be a Chapters store, it’s part of the family owned and operated retailer’s long-term growth plan as it readies for a leadership transition to the fourth generation as well as its centennial.

“Bennett’s is thinking long term,” third generation president Eric Bennett told Home Goods Online in a recent interview, adding a third store will provide economies of scale that should enable the company to thrive.

“In order to give the current and future consumer what she wants, significant improvements in technology will be required,” he explained. “With three stores, the investments in things like improved point of sale information, virtual reality, improved web sites, delivery tracking software and other in-store technology will be more affordable.”

At 27,000 square feet, the Kingston store is slighter larger than its relocated Peterborough flagship – where the retailer’s buying and distribution centre is headquartered – which opened in 2015 and was also designed by Connie Post, the North Carolina-based owner of Affordable Design Solutions. (This store was featured in the Spring 2017 edition of the Merchandiser)

Eric and Marlaine Bennett are seen here in their new Kingston store. Eric took over the business in 1985 from his father and built the store as part of a growth strategy that will see it transition to the fourth generation of family leadership.Kingston was chosen as home for store three for several reasons but most notably because of its stable economy. “They aren’t having huge growth, but they are stable,” Bennett said. “It’s far enough away from our existing two stores (the other being the original store in Campbellford, Ontario) but close enough for us to manage it. Kingston is a larger city than Peterborough and has more higher income employment.”

In fact, the city is home to Queen’s University and the Royal Military College. Kingston also boasts an extensive hospital network and other government-related employment including Corrections Canada and the Department of Defense. Private sector employment also tends to generate higher than average earnings, making Kingston one of the country’s more affluent communities on a per capita basis.

The drawback, Bennett noted, is the population surrounding Kingston is limited. “Whereas Peterborough has more population in the surrounding region than Kingston does,” he said. “Bennett’s always aims to be a ‘destination store’ and attract customers from longer distances than most furniture stores.”

While the Kingston and Peterborough stores have design elements in common, they are quite different in several respects. “Peterborough was built from an old 70,000 square foot factory with exposed ceilings and exposed wood beams,” he said. “It’s more rustic and relaxed while Kingston is a new building with a more modern look – even a bit ‘glam’.”

 Connie Post took advantage of the structure’s natural light when creating the interior of the new Bennett’s Furniture & Mattress store. In a previous life the structure was a Chapters store with huge windows on the front and side.Eric Bennett believes their Kingston store will fill a void in that city’s market for furniture and mattresses and will occupy its own niche – particularly in the ‘better’ and ‘best’ segments where the competition is not as fierce. Both Leon’s and The Brick have stores in the city and there is a La-Z-Boy Furniture Galleries store as well as a number of independents including James Reid, generally regarded as the oldest furniture retailer in the country. Lastman’s Bad Boy, the Toronto-based high-impact promoter opened a store in Kingston in early fall 2019. Sleep specialists Mattress Mart and Sleep Country Canada are also to be found.

Kingston was also home to one of the more successful Sears Home stores, which shuttered with the iconic department store closed for good in early 2018.

“There are a lot of furniture stores in Kingston,” said Bennett, a well-known and long-time shareholder of Mega Group, the member-owned buying group based in Saskatoon. “We always try to develop our own brand strategy and offer the consumer something different. How well we do this will determine our success.”

The adoption of new technology, including an upgraded web site (a project that’s in its early stages), will also be critical to the store’s long-term success. “We believe technology will find a way to let the smaller player compete,” Bennett said.

Although Bennett’s is firmly brick-and-mortar, its competition of tomorrow is not other traditional furniture stores, so being able to source product at the best price will become more critical. “Flowing containers and having our choice of the best suppliers will be more important,” Eric Bennett said. “It will be easier to flow containers with three stores.” 

Click here to read the rest of our report in the HGO Merchandiser.

Article, Goodmorning.com rank among top growing firms

28 September 2020
Furniture, Mattresses, Retail

TORONTO – Four companies closely identified with Canada’s furniture, mattress and major appliance sector were ranked amongst Top 400, a compilation of this country’s fastest growing enterprises, published last week by the Report on Business. Two were e-tailers and two were point-of-sale consumer financing providers with strong ties to a expanding number of retailers.

In a statement, the organiser explained the voluntary program – launched in 2019 by the Globe & Mail – ranks participating private and public Canadian businesses on three-year revenue growth.

For the first time, the Edmonton-based mattress e-tailer GoodMorning.com was named one of Canada’s Top Growing Companies in an annual ranking conducted by the Globe & Mail’s Report on Business magazine. Seen here is a sample of their Logan & Cove model.“Applicant companies had to submit a ballot, complete a full application survey and supply supporting financial documentation to our research team for both 2016 and 2019. We evaluated companies based on the most recent fiscal year for which financial statements were available, with a latest possible year-end date of April 30, 2020,” they said, adding to qualify, a company has to have annual sales of at least $2 million in its most recent fiscal year and had to be for-profit, Canadian-run, independent and headquarterd in this country.

Flexiti Financial, a provider of point-of-sale consumer financing, was the highest ranked of the four at No. 6 with three-year growth of 5,748%.

“We are honoured to be ranked among Canada’s Top Growing Companies for the second year in a row,” Flexiti founder and chief executive officer Peter Kalen said in a statement. “Our growth in the last year is attributed to the signing of great new merchant partners and has been amplified by new implementations of our online financing solution.”

The report noted Flexiti had 2019 revenues of between $25 and $50 million with a workforce of 225. The company provides consumer financing to several furniture, mattress, electronics and appliance retailers including Leon’s, The Brick, Wayfair, Mobilia, Lastman’s Bad Boy, Alexanian’s, EQ3, Visions Electronics and Canadian Appliance Source.

Flexiti’s primary rival in the consumer financing space made the list for the first time. PayBright was ranked No. 68 with a three-year revenue growth rate of 765%. The Toronto-based firm has 140 employees and revenues of between $10 and $25 million for 2019.

PayBright customers in this industry include e-tailers Endy, Article and Rove Concepts as well mattress specialist Sleep Country.

Coming in at No. 108 was the Vancouver-based contemporary furniture e-commerce specialist Article with a three-year revenue growth rate of 460%. The company, which launched a home delivery service in the Greater Toronto Area earlier this summer, made to the list for the second consecutive year. Led by chief executive officer Aamir Baig, the company has 435 employees with revenues of between US$100 and US$250 million in 2019.

Making the list for the first time was the Edmonton-based mattress e-tailer GoodMorning.com which placed No. 123 with a three-year growth of 398% and 2019 revenue of nearly $40 million.

Born Novosbed Inc. in 2009, GoodMorning.com was one of the first online bed-in-a-box brands in the world and was an early innovator of the risk-free at-home sleep trial. The company said in a statement that it believes it is Canada’s largest independent online mattress retailer, having sold more than 125,000 mattresses. It produces several brands including Douglas, Novosbed, and Logan & Cove, among others.

“We’re thrilled that GoodMorning.com has been recognized as one of Canada’s top growing companies,” company founder and CEO Sam Prochazka said. “Our single greatest achievement is to have developed a company culture that relentlessly focuses on what’s important to our customers and delivering that – and only that – to them quickly, efficiently and with zero risk.”

The full list of 2020 winners, and accompanying editorial coverage, is published in the October issue of Report on Business magazine which is currently available online at tgam.ca/TopGrowing.

“The stories of Canada’s Top Growing Companies are worth telling at any time but are especially relevant in the wake of COVID-19 pandemic,” says James Cowan, editor of Report on Business magazine. “As businesses work to rebuild the economy, their resilience and innovation make for essential reading.”

“Any business leader seeking inspiration should look no further than the 400 businesses on this year’s Report on Business ranking of Canada’s Top Growing Companies,” added Phillip Crawley, publisher and CEO of the Globe & Mail. “Their growth helps to make Canada a better place, and we are proud to bring their stories to our readers.”

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Home Goods Online.ca 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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