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The Heart of Futon Industry - Is Ours Still Beating?
With this year marking the 20th Anniversary of the Futon Association International (FANA for those of you who have followed this thing for longer than just the past ten years) I wanted to be one of the first to say, “Congratulations!”
Looking back at 20 years of futon history would be fun, but we’ll save that for another time. The bigger question is, what have we matured into over the years? Are we better or worse off than we were back then? Like most rhetorical questions the answer depends on your perspective.
Most of the early participants in this category had a very different perspective about why they were in the “futon” business than many of the companies that lead the way today. The focus back then (1970-80) was the Asian and specifically the Japanese aesthetic. Though Japan had become a major force in the global economy, dominating the automotive industry and the world of consumer electronics, there was a mysterious and magnetic attraction to the minimalist styles of the Japanese home/living space. Tatami mats covered the floors of whole rooms. Shoji screens and walls, with their translucent paper panels, separated room from room and allowed interior designers the ability to close off space for privacy and then open it up for community, with ease. Pillows for sitting, low tables for eating, and an almost empty interior landscape gave American designers a palette of wood inspired earthtones, spartan white walls, and few accessories. Along with all that waking time came sleep-time and the futon concept. Hidden away during the day, this flexible, thin futon mattress designed to be used on the soft tatami floor burst on the American scene. Made of 100% cotton the Japanese futon quickly morphed into something that had the square edged shape of an American mattress, while retaining the flexibility of the original design. Natural, organic, and minimalist remained at the center of the growing cottage industry. Along the way the American futon mattress came out of the closet and became a couch by day and bed by night.
By the early 1980s things had progressed to the point where the Japanese or Asian “look” was still cool but it too had been "homogamericanized". The aesthetic had been commercialized and entrepreneurs were building businesses that looked the part on the outside, but were actually focused more on growth rather than on maintaining some kind of spiritual connection to their Asian roots.
Let me state right up front that I am a capitalist. My observation is simply a statement of fact, not an indictment. When I started selling futon furniture in 1983 we had trouble keeping and even getting Brouwer products that sold every day for $599 to $1299, and that was just for the futon frame. On the other hand, what did happen in many instances back then did steer us on to a new course.
Concurrence and Competition— Maturity or Bust!
Two things happened concurrently back in the late 80s. First, some of the smaller, pioneer startup companies emerged, made tons of money, and then choked on their success. Secondly, some larger corporations caught on to the swelling wave and cashed in on a trend that is still growing to this day. The maturation process has essentially ended any attachment to the simple aesthetic of the past. Industry, it seems, with its focus on numbers, often replaces the heart of a product (the very reason manufacturers and consumers “buy in,” in the first place) with a mass marketable version. Part of the reason this happens is because the decision makers know that by making more product available many more people can enjoy the benefit of the product, and that theoretically, higher volume means higher profits. Both forces are at work in every industry.
I guess you can also throw in a measure of ego, competitive spirit, marketing savvy, and inventive product improvements that all lead to greater and greater success, at least in our theoretical model.
The Measure of Success
The big question is, how do you measure success? If you measure it by sheer numbers (units sold or dollar volume) then we have succeeded. At the same time if you measure it by how well we line up today with the aesthetic of our pioneer founders then I guess you could say something’s been lost in the translation. Depending again on your perspective you could say that all this progress has brought us to the point where most American consumers think a complete futon sofa costs a measly two hundred bucks at Wal Mart. At the same time much of the product I see coming to market today is superior in comfort, highly versatile, of high quality and is available at more dealers than ever in our history. The futon furniture I see and promote has become real furniture for the home. Today’s home.
The heartbeat of the industry has definitely changed. It may be different, but it is stronger than ever.
FAI Survey Results—The Sequel
In our last issue we outlined the results of the first ever industry survey as produced by the Futon Association International via their vendor UMASS Dartmouth and the Charlton School of Business. As they went over the results with a fine tooth comb to prepare for a distribution to the trade media it was discovered that the sample used was skewed to dealers who had attended the Association’s show, and was thereby not complete. FAI went back to Dr. Nora Barnes, and she and her team made the adjustments necessary to balance the scales.
The key difference between the first iteration and the second is the number of full line dealers who are included. The first time out only 22% of the sample were full line dealers (FLD) this time the poll included 71%. The number of companies selling futon sofa sleepers went from 93% to 40%. Another number that changed significantly was annual sales. The earlier survey (the one with fewer FLDs) showed that only 4% of the sample had annual sales for all sofa sleepers of over $1 million, while the new number reports that 40% have sales over that number.
The most exciting number gleaned from the new survey (the one with more FLDs) is that over 77% sell futon sofa sleepers for more than $301.00 (41% over $451.00). This number is almost identical to the earlier survey, thereby confirming that furniture dealers who sell futon sofa sleepers as real furniture for the home are selling those units for almost double the price on average vs. the $200.00 that was reported in the 2002 F/T consumer perception survey. F/T is scheduled to complete that survey again in 2004. It would be interesting to find out where those consumers, the ones who say they may purchase a futon sofa sleeper in 2004, intend to make their purchase.
Outsourcing Futons - Sounds Like Early Retirement !?
Imports are great for the economy. Outsourcing is the best thing that ever happened to the American bottom line. If both of these statements are essentially true then we can all look forward to riches beyond our wildest dreams, and an early retirement. If both are essentially false we will be out of work and out of cash, looking for the people who sold us down the river.
In a recent editorial column (The Providence Journal, February 18, 2004) Froma Harrop outlined the facts. “Last week,” she says, “N. Gregory Mankiw, chairman of the President’s Council of Economic Advisors, stated that outsourcing American jobs was good for the country in the long run. A chorus of economists and financial pundits sang hymns to his wisdom.” Harrop ultimately sides with Barron’s Alan Abelson who takes exception to the spin. He asks, “What would out-of-work economists do?” They could find jobs immune to outsourcing, like, “Peddling real estate, perhaps, or waiting on tables.”
As I have stated elsewhere, I am not a professional economist. But it seems to me that when government policy and corporate America put literally thousands of people to work (because it’s cheaper) overseas, some proportionate number of people are out of a job here in the good ol’ USA. It also seems logical that if companies across the board import all the products they sell, and outsource all their white collar jobs too, then more and more Americans are out of work and out of cash. Who is going to be able to buy all this stuff made overseas?
“Joe, Joe, Joe,” you say, “It’s not that simple. Many other very complex economic issues play into this. It all works out in our favor in the long run.” Okay, what are they? Call me a pessimist if you like. But I just don’t see how prosperity can come from this formula. What do you think?
Went to IFAM. The show was very well run and it was beautiful to behold. The problem was there were very few buyers on the floor. As we all know, regardless of what IFAM (or the WMC) says, the two show concept for IFAM will only work if they both happen on the same dates. And I mean the exact same. Most people I talk to say they will go to Vegas for a show, but I doubt they will go twice in the same month. The IFAM people know this and will have to work extra hard to have the dates of the two shows overlap, at least when the WMC is actually open.
Mayor Laffey Update
The last time we caught up with Cranston, Rhode Island Mayor Steve Laffey he was up to his neck in pink flamingos and answering questions on national television’s leading political talk show The O’Reilly Factor. Since then the news has been almost all good. The ACLU is suing the City, but Steve’s college roommate, friend, and Constitutional lawyer Tom Marcelle is coming down (pro bono) to defend our freedom of speech. Also, as predicted, two of the rating agencies that rate municipal bonds raised the bond rating of the City of Cranston. It is no longer the lowest in the country. This is the equivalent (in one year mind you) of saving the Titanic, climbing Mount Everest barefoot, and dropping the ring of power into the lava flows of Mt. Doom while Sauron was making a potty visit. Stay tuned to all the excitement as the 2004 campaign season unfolds.
Pats Super Bowl Dreams Come True— But Still No A-Rod
The Super Bowl Champion New England Patriots did the impossible again in 2003 (as predicted). Fifteen in a row, capped by a great win in Houston (Janet and Justin’s antics notwithstanding). Now comes A-Rod, messing up my big prediction by signing with the dreaded NY Yankees. It’s just not fair. I guess the more George spends on payroll the more luxury tax they pay to the small market teams. Some say over $80 million this year alone. I still pick the Red Sox to win the 2004 World Series in six against the Cubs. Hey, like they say at Verlo, “Dream Big.”