Price Increases in Furniture – How Retailers Are Responding
What is Causing the Furniture Price Hikes?
2020 has it all, it seems: The pandemic with widespread shutdowns has led to unprecedented demand for furniture and suppliers are now facing severe container shortages, gridlocked seaports, stiff competition from other industries, and a lack of skilled workers both at factories and transportation companies.
Also, material costs have risen sharply and as a result, retailers have already been warned of the incoming price hikes and surcharges of 4% or more. These price increases are not only affecting the cost of items ordered in the future but some products that are already on order.
Since the end of Spring 2020 when stores began to reopen after the pandemic-induced quarantines and lockdowns, demand for furniture has been at an all-time high. Major manufacturers started breaking sales records month after month – so much so that the distribution and supply chain just can’t keep up.
Some manufacturers have chosen to limit their catalogs and product assortment to focus on a selection of core items. Over time, reducing the size or re-specifying materials may be a possible solution, but in the short run, every retailer is facing price hikes on pretty much all the goods they can get their hands on.
How Retailers Are Responding
With demand at an all-time high, the logical consequence is to pass on price increases to the consumer – which is what’s currently happening at scale in the home furnishings industry. When pricing merchandise, there are multiple layers retailers have to take into consideration:
- Does the item come with MAP (minimum advertised price) for online? If so, while the brick & mortar price might be lower and the item in-store can be priced more aggressively, on your e-commerce website you need to stick with MAP.
- Do you have significant online & local competition with an aggressive pricing strategy? If so, it makes sense to price comparatively or introduce a price match guarantee.
- Do you use “landed cost” (includes freight) as the basis of your price calculations? If so, the margin or markup multiplier needs to account for that or the item gets unnecessarily inflated.
- When using Charm Pricing (or “psychological pricing”), make sure you’re not sacrificing too much of your bottom line. For example, a $427 sofa might still sell well at $419 or $409 versus $399.
Don’t Forget To Re-Price Your Website & Marketplace Accounts…
A reliable catalog management software to automatically price, manage and distribute your product data on all your online and in-store channels is essential right now. Having an all-in-one platform makes the process of updating prices in multiple places easier and much faster. Here’s what to look for in a product data syndication platform:
- Product information can be edited and synced to multiple selling channels from one spot.
- Quick and easy-to-use system with reliable technical support to help you make changes at any time.
- A platform that supports seamless import and export of all product data.
- Integrations and connectors to other retail management systems.
- Pricing engine supports automatic charm pricing and smart rounding options.
Consumers want to know what is in stock or when they can get items they fell in love with. Keeping inventory records up-to-date and readily available at the point of purchase is absolutely crucial to save time and to provide an exceptional customer experience. An automated inventory service allows retailers to keep records up-to-date on all selling channels in real-time. Retailers are even using these services to prioritize their on-hand items to guide consumers towards goods they can get their hands on quickly.
Resources for Retailers Using Wondersign
Here’s a list of resources focusing on the pricing and inventory features, designed to make your life easier when using the Wondersign platform. The price import and export functions allow you to keep all your sales channels in sync. This is, of course, only if you don’t use an automated syndication service to keep all your sales channels in sync.
Setting and Editing Pricing
Use this detailed walkthrough on how to set and manage prices:
For more information view our help article: Overview: Managing Prices on the Catalog Kiosk.
Import Pricing via Spreadsheet (CSV)
Do you have custom pricing for a lot of your products or do you want to use pricing from your POS/ERP system? Simply import your retail, list (comparison), and even rental/financing pricing using a spreadsheet. Use the Brand and the SKU columns as the unique product identifier to quickly update all your merchandise in bulk.
Visit our help article: How to Import Custom Prices from a .csv or .xls File
Export Pricing and All Product Data
Need to make updates on other platforms that aren’t directly connected (such as your Shopify or BigCommerce store)? Export your pricing and product data to import into your e-commerce store, Facebook Shop, Pinterest and Instagram ads, or wherever you need to make updates. This ensures you’re providing a consistent shopping experience for consumers whether they visit your store online or offline.
Mange How Pricing is Displayed on the Catalog Kiosk App
You’re in full control of how your pricing appears when using the Catalog Kiosk App. You can manage all display settings in the Catalog App Manager (CAM).
For more information on the topic, visit our help article: Overview: Customizing Your Devices Using Device Groups – Price Display
Show What’s In Stock And Readily Available
With product out of stock and lead times much higher than usual, it makes sense to prioritize goods that are either in your local warehouse or at nearby store locations. In addition to making sure accurate inventory numbers are being displayed on kiosks and sales tablets in real-time, you can also prioritize items that are in stock – and have them show up first. We call this “Custom Sort Order” and it impacts the order in which item listings and search results are being displayed. It’s part of our “Import” features that allows you to rank items based on their availability.
Local inventory can be set up and managed directly in your Catalog App Manager (CAM) account.
For additional help or technical support, you can visit our always available knowledge base, send us a chat message in the bottom right corner of your screen, contact us at firstname.lastname@example.org or toll-free 1-855-408-9966 and we’re happy to assist you.