Grand Furniture embraces growth

Family-owned retailer plays up youth department

By Lisa Casinger -- Kids Today, 3/1/2007

Rose Stein founded Grand Furniture more than 50 years ago with her sons Herbert and Jerry. The one-store operation in downtown Norfolk, Va., has turned into six stores now run by Rose's grandsons, Steve and Craig.

Steve handles the merchandising, warehouse and distribution aspects of the business, and Craig manages customer credit and other financial responsibilities. The brothers also are familiar characters in all of Grand Furniture's radio commercials.

"Our newest and largest store in Chesapeake has been opened for one year," Steve Stein said. "This store has a youth area of approximately 13,000 square feet and all of our stores have a dedicated youth department."

Stein looks for the new, larger store to pay off in the long run.

"We have definitely been able to use the space to grow our youth department and hopefully grow our customer base," Stein said. "On the other side we are continually working to reduce our damages and overstock inventory by utilizing store closings as a means of moving this product. As with any other furniture retailer, we must keep product in stock, without being over inventoried."

Youth represents about 15% of this $43 million business and the growth in the youth department has brought a new customer base to the stores.

"Grand Furniture is an installment house, which means we carry our own credit," Stein said. "With the growth in youth, though, we're seeing a new customer. We do sell lower-priced youth furniture, but we also have customers spending $2,000 and up on youth."

Though furniture is the main draw in the Grand Kids areas, the stores also sell bedding, lamps, rugs and accessories. These not only add to the merchandising and displays but also represent nice add-on sales.

The Grand Kids departments carry furniture from Ashley, Bernard, Trademasters, Tradewins, Standard, Canyon, Opus, Young America, Vaughan-Bassett, Berg and Powell. Accessory vendors include Ashley, Daylan Rugs, Bonanza, Heavy Metal, Pacific Rim, Tempo Lamps, Harris Marcus and Fiesta.

"We sell a lot of all the furniture but loft beds are always best sellers, along with twin beds," Stein said. "We also carry several specialty groups that do very well like Winnie the Pooh and Disney's Princess group from Canyon."

The Grand Kids areas are designated with special signage and colorful arches and they floor 10 youth bed groups, about three loft beds and an assortment of bunk beds.

White is still the best-selling finish, according to case goods youth buyer Kathy Gecek, and girls groups are top sellers.

"Full beds are almost as popular as twins," she said. "And it is amazing, but maple/blue combinations as well as pine are also popular."

Gecek said if groups are slow moving, they're able to turn them around quickly either through markdowns or moving it to one of the clearance centers so they can bring something fresh on the floor.

Several of Stein's vendors have special order programs that enable Grand Furniture to provide customers even more options, but the retailer also offers its own credit program and delivery.

"Customers can get their credit pre-approved on our Web site so they're ready to buy when they enter our stores," Stein said. "We also have a fast credit approval system in the stores, which means customers spend less time on paperwork and more time shopping."

Grand Furniture uses TV, newspaper, radio and direct mailers to reach customers. Craig and Steve give the ads a personal touch by being the spokesmen in the radio commercials. They run ads on the Disney Channel and host in-store promotions like a recent talent search looking for the new local Cinderella. Stein stays informed about what his competitors are selling and usually is willing to match a price to save a sale.

With such a large, successful operation it's critical to have good, well-trained employees. Between the stores and clearance centers, warehousing, finance and delivery, Stein has about 350 employees.

"Hiring and keeping good employees is always a challenge," Stein said. "I look for honesty and the eagerness to grow in my employees. We use the Freidman Training plan to train our sales staff, which we hope allows them the ability to make a good living. We also offer medical benefits and a 401(k) plan."

When it comes to vendors, Stein's biggest challenge is "making sure the quality of the product is maintained and quick delivery of open orders." Aside from attending the Las Vegas and High Point markets, Stein meets with vendors in his stores, faxes his orders in to his reps or the factory and also uses vendor Web sites when available.

Stein says the secret to Grand Furniture's success is that "we are constantly cultivating the "captured" customer from our accounts receivables. We have a large return customer base, which hopefully continues to grow."

White girls groups remain a top seller at Grand Furniture.

The main entrance to the Grand Kids area draws the eye with an almost Alice-in-Wonderland-feel, bright colors and graphics. Youth represents about 15% of this multi-million dollar third-generation business.

Grand Furniture merchandises its vignettes, like this Sunday Funnies collection from Powell, with accents, textiles and wall decor.

This highly accessorized vignette is certainly fit for a princess and Grand Furniture recently hosted a talent search looking for the new local Cinderella as a traffic builder.

Loft beds, like the one in the corner are a top-seller and full beds also are becoming more popular.