Haverwood Furniture

Haverwood Furniture, Inc.

Q1 How would you characterize the HH wood Furniture Industry? •Haverwood L Room & Bedroom
•Haverwood has own sales force 10 sales/ 2 Reg
•Upholstered 50%/ Wood 40%
•Total Ind Sales 3 Mil
•Top 10 Wood Manu = 1/3 of total sales
•Asia imports driving down prices (BPuerto)
•US Manu downsized – 100 Manu
•$15 million sales = 6% mkt share
•Hwood uses 1000 specialty style (Selective distribution) •Gallery concept prevalent
•Do not have full line in all retailers
•Do not have galleries in all retailers

Q2 How do consumer buy?
•94% enjoy shopping
•Lack confidence about quality or evaluating price
•95% get redecorating ideas from Mag.

•84% believe higher price = higher quality
•72% browse even when not buying
•Rely on sales people for ideas but want to be left alone to shop •85% read ads before shopping
•Difficult to select styles

Attributes
•Styling/Design (1)
•Brand Name/Image (5)
•Price (4)
•Construction Quality/workmanship (2)
•Store Quality/Image (3)

Buying Decision
•Joint decision
•Difficult – guidance
•Little Knowledge

Q3 What is the role of Marketing Communications
•Consumer advertising
oinforms about styles, arrangements
oEmphasize Quality
oDevelops “share of mind”
•Company Salespeople
oSell thru as much of line as possible
oSell-develop rapport
oTraining retail sales people – product quality %& feature oBuild enthusiasm w/ RSP
o100% sales time
•Trade Advertising
oPoint of purchase – anything that goes on at the time of sale oBrochure take away
•Cooperative Advertising
oGiven by the retailer but funded by the manufacturing
•Builds bond between retailer and brand

Q4 Objectives for 2008
•Broaden advertising incl online
•Penetrating boomer demo (Buy hi-quality)
•Lower ad budget if possible
•Marketing many lines
•Broaden full line penetration
•More galleries
•Reach consumers at critical decision points

Q5 How might objectives be translated into budge?
•Sales Increase
oLast Year 75 M * 1.

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04% = $78000000
oSales person option $135000 (SALES)
o5% of 78000000 =
•3900000
•3675000
•225000
o1% = 780000 (AGENCY)
•562000
•218000