Here is why Ethan Allen will go out of business in 6 years or less.
1. "Custom" furniture is not custom furniture, they offer what would be best called semi-custom furniture.
2. Small and decreasing showroom inventory. They want customers to purchase non-returnable furniture based on images and a library of stain and fabric samples.
3. Hoodwinking customers They sell their furniture is high quality US construction with sales people stating it is solid wood 'heirloom' furniture where as their website states, "*Other materials may be used on internal and secondary components." False advertising? Certainly false spin.
4. Going the wrong direction. Just across the highway from this particular location is a huge "Rooms To Go" and "Star Furniture" showroom along with a new La-Z-Boy showroom just up the highway where customers can see how furniture can be staged in their own home, see the level of quality and construction and decide if it meets their bar, but most importantly touch, feel what they are paying a lot of money for. This in turn circles back to #2, shrinking their store footprint and therefore display pieces as mentioned. It's nearly impossible to see a floor sample to evaluate the EA quality for yourself, justify the price premium. It's really embarrassing considering the cache the brand likes to spin. Even this franchise owner was trying to spin the smaller footprint in an obtusely positive light to the local press, but what else would you expect from a business owner? Funny how one of the design professionals tried to sell that all furniture stores are shrinking their footprint. By the way, when the local La-Z-Boy decided to relocate, their new showroom is equal if not larger than the one they left. Same goes for the local Bassett. Huh...
5. Following design trends instead of leading design trends coupled with following bad design trends. Not all trends are good trends. Heirloom furniture stands the test of time, the essence of why it can be handed down. This may be the most significant sign they have lost the market.
EA's company performance is down double digits year/year. The brass is trying to turn it around with discounts deeper than I've ever seen revealing their markup is just as much as you thought it was if not more. It appears they are living on their legacy which was well earned and deserved, but they are going the wrong direction with a poor turnaround strategy. Farooq, this is for you. read more