Muncie, IN, February 21--Veteran sellers of furniture can rattle off names of more than a dozen local competitors who have gone under in the past 20 years.
"Going out of business can be a lucrative thing, and a furniture store can make more money during the course of the sale than it might have made in the past five years," said Tim Walls, an owner of Walls Furniture. "A going-out-of-business sale can suck so much money from local shoppers, that another border-line store might also go out of business."
In the past 15 months, Leath, Kiefer and Madison Street furniture stores in Muncie have decided to call it quits.
The latest three stores in a retail niche that seems particularly prone to displaying the familiar store-clearing, going-out-of-business signs ran the gamut from corporate-owned, to family-run, to an aging individual operator.
"For as long as I can remember, furniture stores have cycled continuously," said Richard Gill, an owner of Gill Brothers Furniture. "Numbers of stores build up during good times, but -- when times get tough -- it weeds out players."
Go back five years, and Heilig-Meyers stores in East Central Indiana, Bullerdick, and Jeffrey-Jacobson Home Furnishings can be added to the list of former sellers of furniture -- again a mix of corporate, family business and one-of-a-kind operations.
Some companies make a habit of going out of business, Walls said, by reopening elsewhere. Sales featuring phrases like mandatory inventory depletion, merchandise upgrade, emergency furniture liquidation, survival and other veiled terms might last years before a going-out-of-business sale actually occurs.
Though the number of furniture stores in business fluctuates locally, the trend has been toward fewer stores in recent years. In 1997, 16 new or new-and-used furniture stores operated in Muncie. Last year, that number was down to 11. Mega-stores such as Wal-Mart have taken up some of the slack.
Economic doldrums and competitive pressures have deflated furniture prices, Gill said.
"Furniture might cost less, but our costs for rent, taxes, labor, health care and heat are not going down," Gill said. "All of the (fifty-plus) stores in our performance group recorded sales downturns in 2004."
Roger Richert, the 'Save-you-money" operator of Richmond, Muncie, New Castle, Daleville and Portland Furniture Outlet Stores keeps opening more stores in East Central Indiana.
Walls offers a no-frills store that offers prices he calls "the new middle."
"People either go cheap, or delay their furniture purchases when money is tight," said James Lowry, a professor emeritus of marketing at Ball State University.
However, Madeline Stage said she and her husband Kent buy furniture the same way that lots of people do -- when it is needed.
"We don't buy furniture that often, but when we do, we like to buy good furniture, something that is going to last," said Stage, an Alexandria resident who grew up in Muncie. "I haven't bought anything in seven years.
"It's time. I'm looking for a sectional, and I'm just getting started."
Stage and her husband visited Muncie's Parade of Homes to get ideas.
The economy slumped for sure after a late 1990s build up, said Lowry, a local retail expert, and owners of furniture stores received an additional one-two blow.
First, they faced increasing competition from big-box and other mega retailers new to the furniture business.
And, secondly, they had to deal with deflated prices linked to an increase in low-priced Asian imports, Lowry said.
"Big chains including Pottery Barn, Crate & Barrel and Pier One are selling furniture," Lowry said. "And Wal-Mart, Target, Home Depot and Lowe's are selling flat-rack, assemble-yourself furniture.
"And some of the furniture makers have begun offering their own branded stores."