With robust product leadership dominating our industry for more than 15 years, the blinds business is now under siege in dozens of markets nationwide. Last week I learned about three major organizations that are struggling.
The Orange County (CA) Register reported on January 25 that 3 Day Blinds is closing 59 stores—one-third of its 179 operations. 3-Day Blinds is one of the original and largest blinds chains going back more than 20 years. This reflects a huge market shift emerging in California, a leader in window coverings trends.
A few days later I heard from two sources that a medium-size blinds franchisor is not accepting new units, usually a sign of trouble. Thirdly, I received an insider message that a major Midwest blinds specialist is reorganizing and changing CEOs due to missed financial targets.
The significance is not so much the news about these operations—many businesses go through challenges and later come out OK. At some point in their careers, most top executives have experienced a setback. I’ve been there myself. As Steve Lynn, president of Sonic Drive-ins said, “We only learn from our mistakes. Success has done in more people than anything else”
The important point about these three blinds businesses is not only their individual experiences; it is the underlying trends affecting thousands more across the country. As CEO of Window Coverings University and Exciting Windows! I receive confidential information from window coverings retailers. Every month my staff takes soundings from nearly 200 specialists of all kinds—retail stores, home-based businesses, blinds and shadings specialists, shutter specialists, workrooms, designers, and drapery craftspersons. We are privy to inside information on these businesses that is not published in the trade press.
Here are the trends we hear. If they are having an impact on you, you might actually have an opportunity in disguise.
• Home Building: Everyone knows about it. This isn’t news. The fact it is continuing and no one predicts a turnaround in less than a year is important. If your business has been dependent on selling low-cost privacy and light control to new homes, then you are hurting.
• Commodity Products, Pricing: We all know the challenge when someone can buy the identical product in different stores, especially different “channels” (box stores for the DIY crowd, designers for upscale customers who want full service are separate distribution channels). Usually, brand names are different for different channels. You don’t find Prada purses in Wal-Mart. Finding the same brand in different channels has been a problem in our industry. I hear that may be changing, but today it is a challenge.
• Competition: Every person in our industry for five years knows that competition is more intense today in the mid-market range than ever before. This is the market of price-conscious shoppers with household incomes in the $40,000 to $75,000 range; home values are in the $175,000 to $300,000 range. Of course, these are national averages and must be indexed if your market is above or below.
• Spotty Markets: Rarely has there been so much geo difference. Business is crummy if you’re in an overbuilt hot spot rife with speculators from two years ago—San Diego County, CA: Naples, FL; and more areas in the South; or maybe you’re in Detroit, MI; Cleveland or Akron, OH; or Anderson, IN; where thousands of auto workers are losing jobs. At the same time, if you’re in Kansas City, MO; Chicago, IL; or Charlotte, NC; you may find business as usual. You wonder what the fuss is about.
• Flight to Luxury: No question, the window coverings market with homeowners with over $75,000 income is the best place to be today. Yes, some of them are showing signs of a squeeze. Tiffany’s is challenged to increase same store sales as are Bloomingdales, and leading fashion department stores. With the stock market down some 10 percent since January 1, even these customers are impacted. But, the market will likely find bottom within 60 days and that trend will quickly reverse. It is not nearly so long-term as the home building collapse. Even Tiffany is still growing, just at a slower rate.
• Fear: The one trend most prevalent that we have not felt in this depth for years. Fear is freezing dealers. They feel out of control. Lead cost is through the roof. With fewer appointments and customers holding back until they know whether a recession is coming cash flow is dying.
OPPORTUNITY FOR LEADERS
If you are selling mainly blinds and “hard” products and are looking for ways to move ahead of competitors doing the same, you have an opportunity for leadership. With others frozen in fear, uncertain what to do, it is a leader’s opportunity to move forward. Position yourself for the turnaround that is not far off.
Now, while you have time, focus on past customers and customers that are still buying. Check the neighborhoods where they live—others in those neighborhoods have the same needs as the customer you just sold. Build on that.
Even more, now is the time to position yourself for the future. Shutters will be strong for another five years. Draperies are just emerging. Fearful, uncertain competitors don’t know what to do. Yet there is always an answer. And that answer is always based on information and education your competitors don’t have and are too lazy to get.
EDUCATION IS YOUR OPPORTUNITY
Educate yourself now to sell to a better market: upscale customers that value quality and service more than low pricing. It is a vastly underserved market with few competitors. Educate yourself about shutters, about draperies, about making rooms more beautiful. Learn new selling techniques to build relationships. Learn preferred customer marketing to encourage repeat and referral sales. Your advertising cost will go down and your profit margins will go up. It is all about education.
Where do you get your education? Attend industry events. Attend your supplier training programs. Take advantage of manufacturer online and DVD training programs. Broaden yourself beyond blinds products to shutters and especially draperies with color and pattern. Most of all, learn new selling techniques. In the blinds business almost everyone sells and quotes the same way. There is a better way.
When you invest in education you set yourself apart as a leader. Customers learn about you as the word spreads. Your competitors fall away in rough times. Market adjustments are purifying; they leave leaders in charge when good times return. If you’re in a bind with blinds, educate yourself on new products, decorating ideas, innovative sales techniques and building customer relationships. As a leader, you will survive today and prosper tomorrow!
This article is based on Steven C. Bursten’s actual experience with sales and financial information working with hundreds of window coverings businesses. Whether you are a sole manager who aspires to higher sales, or you manage 50 window fashion decorators in a multi-million dollar business, this series will help you manage sales better and increase your profitability. Bursten is the retired founder of Decorating Den Interiors and author of a how-to book on new business start up, “Bootstrap Entrepreneur,” and is a leading expert in window coverings marketing, sales systems and sales management through his company, custEmers.com. Questions and comments welcome: email@example.com or call (888) 333-8981.