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Are internet furniture sales hurting retail stores?


Posted By RyanM, 11/22/2012

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My name is Ryan and I am an MBA student at the University of Central Oklahoma. Would you mind answering a quick question on the furniture industry needed for a class assignment? I need to know if online Internet furniture sales have been hurting the sales of retail stores. Ethan Allen and Furniture Brands in particular have either closed or consolidated a  number of stores lately. I wonder if online shopping is part of the reason  why. Any answer you can give will be very helpful!


Replies

From danielsides, 1/20/2013  5:28 PM

Internet is everywhere now, as well as the competitors. Some people prefer to shop online than go to stores because it saves more time and energy, so I think in a way it affects the retailing stores.


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From eamonflannigan, 12/6/2012  12:51 AM

I think that traditional furniture shopping will remain permanently, for the simple reason that furniture is the type of thing you want to see physically and touch before you buy.  As Russell says, however, online shopping is a significant part of the modern retail world.  I'm curious--I am unfamiliar with the problems Furniture Brands has had.  What are the issues of "much greater impact" you allude to?

RyanM, Let us know how your class assignment goes.

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From RyanM, 11/22/2012  10:28 AM

Hello Ryan, I look at this problem a bit differently. It isn't "us" vs. "them" at furniture retail. The fact is that every time strong competitors come into furniture retail they take market share from established stores. Imagine that you were a furniture store in Elizabeth, NJ and IKEA moved in down the street. Same thing.  Yes, online furniture sales have grown consistently and are forecast to continue growing I've seen forecasts that the will account for perhaps 17 percent of total furniture sales (though I don't remember the time frame the study said this would happen in). So when a fast growing online retailer such as Wayfair comes into the market, it takes market share from brick and mortar furniture stores. I don't think you can make a case that internet retailing is directly responsible for consolidation of Ethan Allen stores or the problems Furniture Brands has had. In a recession, strategic store closing have been common and advisable. Also, as a manufacturer, FBI does sell to traditional and online retailers and they've had other issues that have had much greater impact than online retailing. Ethan Allen furniture can be purchase online as well as at retail locations. I think that you could make a case that smaller and independent retail stores that have not added ecommerce to their website are hurting themselves since they are not going toe-to-toe with lots of new competitors hundreds or thousands of miles away. Even retailers who choose to only ship locally can compete online in their local areas online. I hope this helps. -Russell, Furniture World Magazine. 

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