Ahead of Virtual PrimeTime in mid-March, we sat down with Nationwide Marketing Group Sr. Director of Furniture & Bedding Jeff Rose to talk about the latest disruptions in the F&B supply chain, and we get a preview of what’s to come at Virtual PrimeTime and beyond for furniture and bedding retailers.
Rob Stott: All right. We are back in on the Independent Thinking podcast. I love how we can do this and get it together in less than a week, Mr. Rose. You and I, all I have to do is call you up, here we are, and it’s an all-star performance. Are you ready for this?
Jeff Rose: You’re making me blush. You’re making me blush, Rob. I love it, man. I love when you can, “Hey, Rose, we need some furniture and bedding information. I’m hearing a lot of good things. Let’s get on a call.”
Rob Stott: Let’s do it.
Jeff Rose: You’ve been a major asset for Nationwide since you came on board, just love all the podcasts you’ve been doing, just with all divisions and just with our entire network. Just kudos to what you and Amy and just the team are doing. Hey, I love when F&B can be a part of it, man.
Rob Stott: Absolutely, and thank you. When there’s so many stories to tell, we have so much time and to be able to tell them all is a lot of fun and hearing from the team, hearing from the vendor community, and our members, obviously, as well, so many great things happening in this space. I appreciate you coming on and taking the time to dive into some F&B business with us. I know we’ve got a lot to dive into, so-
Jeff Rose: We do.
Rob Stott: … we’re going to start deep. We’re going to start deep in it.
Jeff Rose: Okay.
Rob Stott: I know at the last PrimeTime show, you gave quite an awesome update, probably one of the most detailed updates I’ve heard. You can tell that to your merchandising partners.
Jeff Rose: I like it. I like it.
Rob Stott: You really did it up at the last show talking about… I mean, we all know that there are supply chain challenges across all industries in retail right now, getting product, but I mean, you went down to the material level to talk about the things that were happening. It was enthralling to listen to. It might sound crazy to be talking about, have those words about lumber and other materials and things like that, but-
Jeff Rose: You just want me to say polypropylene one more time.
Rob Stott: I do. I do.
Jeff Rose: That’s what you want me to say.
Rob Stott: That’s all I wanted, and we got it, so now we can move on, no.
Jeff Rose: Yes.
Rob Stott: I want to start there to kind of see what you’ve been tracking, how things are going, because I know that’s the one thing that’s on top of everyone’s mind, whether they’re on the vendor side or the retailer side right now.
Jeff Rose: Yeah. No, it’s, I think, a great place to start. It’s on the minds of retailers every single day. Ending 2020, I mean, there were still a lot of questions, a lot of, what’s going on? I mean, there’s still a lot of questions today. If you were to ask me this three weeks ago, four weeks ago, I would tell you that on the bedding side of things, we are rocking and rolling and getting back to pre-COVID shipping times and things of that nature. But from 2020 to 2021, we never would have thought we would have a pandemic. We never thought we would have had this massive freeze that just happened a couple of weeks ago across the majority of the U.S., and that has caused some supply chain issues, mainly on the foam side of things that some of our manufacturers are going to be dealing with for the next couple of weeks.
But I can definitely tell you from most of our manufacturers, they have, no pun intended, weathered the storm. There were so many challenges, Rob, that they were dealing with just with no chemicals that go into the foam to the lumber, like we were saying on the last time we talked, that with the influx of the consumer demand, I mean, it just was pushing lead times out on the bedding side that we have never seen before. We were able to get back at the beginning of the year, and they were really starting to catch up and things are going, and then we had this freeze side of things. TSI, mainly on the Stearns & Foster and Sealy side, they’re going to see some challenges over the next couple of weeks, but they feel mid-March, they’ll kind of get back to some pre-COVID times, which is a good thing.
On the Corsicana side of things, they’re back to commercial shipping policy times, which is about four to seven days, which is a very positive thing. Then same thing on the SSB side. They’re pretty much back, as well. But this freeze that happened with a lot of these plants that are dealing with a lot of the foam issues. It’s going to push them a little bit a couple of weeks, but I think they’ll right the storm and we’ll be back. Tempur-Pedic, I know that’s a major brand of all of ours. They make their own foam, and they have their own supply right there, so they’re not really dealing with a lot of issues. But the other ones, they’re going to see some immediate issues a little bit, but after a couple of weeks, we’ll be back.
Rob Stott: I’m sure people listening to this are probably familiar, but the less-informed out there, you said a supply. Is it the amount, with the foam issue that you’re talking about? Is it an amount, is it the fact that there’s demand for it or is it actually how the production [crosstalk 00:05:10]?
Jeff Rose: It’s actually how it’s made. I mean, there’re different chemicals. I don’t want to get into the TDI chemical and just all that kind of stuff. There’re plants off the Gulf Coast that they were dealing with hurricanes last year, and then they got this hard freeze that just happened throughout that Gulf Coast region that is causing these plants that produce these chemicals just… I mean, I saw some pictures. I mean, they were just frozen, locked up, and had to completely shut down.
Rob Stott: Wow.
Jeff Rose: The consumer demand is so strong right now, if they’re even a day where they can’t produce, I mean, it just compounds the issue. We’re not going to be dealing with what we were seeing back in the August, September, that time range, but it’s amazing that once we get ahead, it’s like we’re taking a step back a little bit, just Mother Nature. I don’t want to call an alarm on anybody, I mean, it’s not going to be as bad as it was, but there is going to be a few. We are in some foam allocations that some of these manufacturers are having to put on some of their products and things of that nature.
The good thing is, just for our retailers, the consumer demand is still so strong right now. I know we’ll get into that here, I’m sure, shortly, but orders are still coming in strong. Nationwide is performing so well right now with both TSI, SSB, even Corsicana. That’s awesome and speaks a lot to what our members are doing, just how they’re advertising, using digital, some of the upgrades on websites, things of that nature. They’re getting out there, reaching that consumer that is still buying today. Supply chain is still top of mind, but we’re going to get there, everybody. We really are, so just keep on doing what you’re doing.
Rob Stott: Right. You alluded to it, but that increased demand, obviously, it has resulted in performance in this space, as again you talked about, just outpacing the industry in so many ways. It’s unbelievable, but also resulting in these manufacturers being able to make some pretty awesome investments in their manufacturing and their ability to produce here locally in the United States. I know we saw a report recently that there’s some, I think, two-million square feet of manufacturing space that is either brand new or in the process of being open by the end of this year. Clear that the demand is strong, and that manufacturers feel it’s going to stay that way to the point where they’re making these investments. Talk about that a little bit, what that is going to do for the space to have all of this new manufacturing capabilities here for the supply chain, for the industry and just for consumer demand in general.
Jeff Rose: Yeah, definitely, a great question. I know we’ll get into furniture here in a sec, because I do want to touch on just the supply chain issue on the furniture side of things. But this is a good segue talking about the bedding supply chain into, yes, they’re having their issues, but these manufacturers, they see just this consumer uptick of purchasing and wanting product now. These manufacturers, TSI, Corsicana, SSB, and just a lot of these manufacturers, they are investing, and they’re investing in a huge, huge way into their brands, in making sure they can get product out.
TSI, for example, I mean, they are literally just… They just opened up a huge plant in Dallas, Texas. I mean, massive, hundreds and hundreds of thousands of square feet. They plan to open up a new facility at the end of the first quarter on the West Coast. This is going to be their 30th factory in North America. I mean, they’re seeing what is happening, and they know they have to invest.
Of course, Ghana just came out, and they are opening up almost a 400,000-square foot facility in Corsicana, Texas. It’s going to be a training facility, a learning and development facility, and then a manic manufacturing facility, all rolled up into one. It’s going to be almost like a campus style-
Rob Stott: Wow.
Jeff Rose: … I mean, which is incredible. I’m so happy for them. This is their 50th year. They’ve been great partners of ours and excited about hearing what they’re doing. I mean, then you take SSB. I mean, all their facilities are open. They’re re-investing and making them better. All of our bedding manufacturers have done an incredible job of looking forward, being forward-thinking on, “Hey, the bedding business is good, so what can we do to make it better?” They’re looking strategically throughout the U.S. to invest and make these facilities as best as possible for the retailers.
Rob Stott: Yeah, absolutely. Obviously, easy to talk about that while we’re talking about bedding and sort of the supply chain there. Just neat to see it’s not even just manufacturing, but you mentioned Corsicana with the training. It’ll be cool to visit those places, I imagine, and see how they’re operating, and not even just for us, for retailers that maybe get a chance to pop by and see how things work there and what’s going on.
Let’s talk furniture, you mentioned it. How are things on that side of the business? I’m sitting here in a home office. I know that’s still top of mind for a lot of people. I don’t mean to keep plugging them, but Night and Day, they’re still right here. Why not do it, right?
Jeff Rose: You love it. You love it.
Rob Stott: It’s there. It’s there.
Jeff Rose: It’s a great piece. It really is, Rob. Furniture, I mean, good things, bad things. I can tell you that it is rocking right now. Consumers are still at home. They’ve been at home for a year and a half. The travel and tourism industry, it’s $1.5 trillion a year that go through this. It is unbelievable that the travel and tourism industries… I mean, it’s one of the hardest-hit industries, and there’s so much of that income that needs to be spent, and it’s getting spent on the home. So the furniture industry is very strong right now. It’s going to continue to be strong, but their issue is their supply chain. They have their own set of concerns and challenges, just like the bedding industry has had, but the bedding industry is getting better.
The furniture industry is still struggling, and it’s going to continue to struggle. I mean, I’m not going to call out any of these manufacturers, but I mean, they’re quoting lead times into 2022, which is absolutely crazy. That means if you place an order right now, you’re not going to get that until 2022. I got a report of a retailer that’s got over $100,000 order into one of these manufacturers, and they can’t get it until 2022.
Rob Stott: Wow.
Jeff Rose: They’re dealing with lumber. They’re dealing with the springs. One of the major challenges out there, it’s containers. There’s not enough containers out there, or they’re just getting stuck on the docks from overseas, just for whatever reasons. It’s just causing a massive issue to just get product.
But I say that, there are manufacturers out there that are better than others. There is product that’s getting out there. Upholstery is on fire right now. Most of upholstery is on fire. Like you mentioned, home office. I mean, that home office industry is up over 35%, which is crazy. I mean, if you would have asked me that a year or so ago, I’d say the home office is struggling, but people are realizing that working at home, things can get done, and the home office industry is exploding, and upholstery is on fire. I mean, just the whole industry is on fire right now, which is great for our retailers. I’m real excited about that, but I would just wish I had better news on the supply chain because it is struggling. I don’t see it getting better, at least until Q3, Q4, at least.
Rob Stott: Gotcha. No, I mean, it’s honest. We like to be able to at least tell retailers what to expect. You mentioned, though, that there’s still opportunity in certain areas in this space, which is kind of what I was going to follow up with. You talked about home office and sort of what this space has done. This past year could have been a little different if it wasn’t for the home office, I feel like.
Jeff Rose: Right, I agree. Think about it, Rob. I mean, just take us. We’ve got a lot of employees.
Rob Stott: Yep.
Jeff Rose: We’ve been home for over a year almost. Then you think about all these skyscrapers. I mean, I think about this all the time. Think of all the skyscrapers-
Rob Stott: I know.
Jeff Rose: … that have all these corporate offices there that are empty right now. Everybody’s at home, and they’d been at home, and they’ve been on these Zoom calls. While they’re on these Zoom calls, they’ll be looking around and looking at their desk that was from 1960, that was passed down from their grandparents or whatever, and, “You know what? I think it’s time for me to get that.” Then you got your sofa that you’ve been on and, “I’m not taking that trip to Disney World this year. I’m going to go invest in and spend some money on some sofas or a new mattress or stuff.”
There’s a lot of industries out there that got hurt this year. I mean, a lot of them. We are fortunate enough to be in the business that we are in. I’m happy for our retailers that are out there, because they deserve this. They deserve to keep on being healthy and being a help in the community and things of that nature. Don’t get me wrong, they’ve all had their challenges. They’re all facing challenges, but I think 2021 is going to be a very positive year for everybody.
They got to continue to work it, and they got to continue to advertise, and continue to promote financing, and make sure their websites are up to date. Digital advertising is such a huge, huge thing right now. I mean, I don’t want to go down the rabbit hole going through all those statistics, but-
Rob Stott: It’s important.
Jeff Rose: … it’s so important. I know you love what you do, and I love what I do, just being able to help these independents make some money and take it back home to their families.
Rob Stott: Absolutely. I mean, part of that, too, is innovation, not just on the digital side, but in stores with product and things like that. I know you’ve got some things going on that we can talk about. Tell me what’s going on. I know it’s on the mattress side, and that’s a space that’s seen some innovation of late.
Jeff Rose: It is. I mean, there’s a couple of things I just want to let everybody know that’s coming up. I want to talk about bed in the box for a second. Bed in a box, it’s here. It’s not going away. In 2020, it was roughly about 30% of the entire bedding business. 2021, we’re looking, it could be 30 to 35%. We’ve always had vendors that got in the bed in the box game, but the F&B division, for some reason, we just didn’t emphasize that. I’d be the first one to say it. We are actually starting March 1st, we’re starting our bed in the box initiative. We’re really going to help our members guide and navigate through the bed in the box process, give them the most opportunity, let them see all the opportunities that our vendors are providing.
What we’re doing, starting March 1st, we’re actually making a centralized location in MemberNet where we’re going to house all the information about bed in the box that our vendor partners have, Resident Home, SSB, TSI, Corsicana. If you’re in the bed of the box game, we’re going to have all that information located there. Then we’re going to have all the bed in the box industry news that’s coming out. If you want to know anything about bed in the box, you’re going to be able to go there. That’s phase one of what we’re doing. We do have a few phases into this. I don’t want to let the cat out of the bag on what phase two is, but that’ll be coming mid-year, and then we’ve got some great things in 2022, but be on the lookout for March 1st, the Nationwide bed in the box initiative on MemberNet, just kind of bringing it all into one location and just letting you choose the right vendor and how to get into that.
Rob Stott: If you were listening right now, it is live. This will be published and up by March 1st.
Jeff Rose: Oh nice.
Rob Stott: It’ll be on March 1st or 2nd, so as we’re sitting here a couple of days before, so it will be live. Be sure, if you’re listening to this right now, you can hit pause, and go check it out, and then come back and finish our podcast here.
Jeff Rose: I love it. I love it.
Rob Stott: That’s awesome, and a space that’s obviously garnered a lot of attention. You’re seeing it everywhere. You’re seeing Superbowl ads. I believe this year, we saw a couple. Cool to see that initiative kickoff. We’ll be looking forward to what’s coming in this space.
Jeff Rose: Yeah, Rob, obviously, we know that the bed in the box product, it’s not going away. We just want to have some opportunity for the members to be able to see what’s out there, and who’s doing what and how they’re doing it. We always feel that the higher-end goods is best for our retailers and consumers, but the bed in the box, it’s a lower-price item, but there are people that want that. We want to give that opportunity to let the member see what’s there. We’re excited about it.
Rob Stott: That’s awesome. March 1st, and then a couple of days later, about two weeks later, we’ll be sitting in front of our computers again. I don’t know. What is it [crosstalk 00:19:35]?
Jeff Rose: I don’t know. I don’t know what’s going on.
Rob Stott: Mid-March, there’s something happening.
Jeff Rose: What’s going on, Rob, in mid-March?
Rob Stott: Virtual PrimeTime is what we’ll call it, that thing. That thing is happening.
Jeff Rose: That little, little bitty thing that we’ve got going on.
Rob Stott: Let’s talk about that. I mean, there is so much F&B news about Virtual PrimeTime this year. We’ll see the return… I’m not going to steal your thunder because I’ll let you dive into it… but we’re going to see the return of Mattress University. There is Furniture Forum that’s kicking off. I mean, I know there’s a million ways we could start and talk about PrimeTime, but I’ll let you pick where you want to go, and I’ll follow your lead talking about this, so let’s have it.
Jeff Rose: Oh, I love it, Rob. Virtual PrimeTime, mid-March. The first thing I want to say is I can’t tell you how proud I am of my team, Johnny Lamp, Chad Fisher, Karen Young, Mike Derro. The team got together, and we wanted to make this show special. Trust me, we all wanted to be in Denver together in-person, but once that was finalized, and we knew we were going virtual again, we said, “What can we do to make this special, make it exciting?” The team brought it. We just went through a bunch of supply chain issues and all the challenges, some of these manufacturers have. We worked hard to just bring a lineup of… We’ve got 30-plus vendors that are going to be there, really excited about that. We’ve worked hard with these great manufacturers to bring some really incredible offers, show specials, some incredible Palooza offers that we’re going to be doing and having for the great membership of Nationwide.
We’ve got the vendors there. We’ve got the offers there, and then learning is such a big part. We worked with Mike Whitaker and his team on Learning Academy, “How could we make it different this year?” What we did is we’ve got eight product vendors that are coming in and just talking product, real excited about this because a lot of our members haven’t been able to go to a furniture market in a while. This is just straight product information. Membership, make sure you check out those vendors. If you want to see what’s new with those vendors on product, make sure you go check them out.
Then Mike came up with a great idea just to talk about emerging brands, so we have four or five, what we call emerging brands, that are in our portfolio, but we thought that they’re doing really great things that you might want to check out. These Learning Academies are more about who these vendors are and why you should bring them into the fold. Really excited about that. We got learning down. We got offers down and the vendors down.
What about key vendor updates? We’re fortunate enough to be able to sit down with Serta Simmons bedding and their leadership. We’ve got their Chief Sales Officer and their Chief Marketing Officer, Melanie Hewitt and Derek Miller. We had a great interview with them just to talk about everything that’s SSB. We were able to sit down with Steve Rusing, who is their President of North America Sales and Scott Warlick, who’s the VP of Buying Groups. We were able to sit down with them and talk about everything TSI, all the exciting things, what’s going on with Tempur and Sealy. Then for the first time ever, we were able to get Ashley Furniture in. We got a sit-down interview with Rick Coppola from Ashley Furniture, who is their President of North America. I’m going to be able to talk shop with Ashley Furniture and let the membership hear what’s going on with Ashley Furniture, so really excited about that.
We’ve got interviews. We’ve got learning. We’ve got offers and vendors. What else could there be? I want to talk Mattress University real fast.
Rob Stott: Bring it home.
Jeff Rose: Bringing it home right here. We got Mattress University. Mattress University has been a staple for Nationwide PrimeTime for many, many years. We wanted to make this one just dynamic and interactive. What we did is it’s all about the consumer journey. All right, so first we have our very own just Queen Digital herself, Ms. Jennifer Danko, coming in hot. She’s going to be talking consumer journey on the website and digital side of things. How do you get that consumer into the store through websites and digital? She’s going to knock that out of the park. Next, once they get into the store, what about that consumer journey? We’ve got a very fun and interactive Mattress University session with Bob Muenkel. It’s called… are you ready-
Rob Stott: Give it to me.
Jeff Rose: … it’s called, Doofuses and Darlings, the do’s and don’ts of the consumer journey in-store.
Rob Stott: It’s great.
Jeff Rose: It’s so, so good. Don’t be a doofus, be a darling, everybody. You got to check that out. Once they go there, next is we’ve got, you talked about innovation earlier, so we’ve got innovation in bedding. We’ve got our very own Director of Bedding, Chad Fisher from Nationwide, just going to talk to you about a lot of the key vendors that have brought technology into bedding, going to talk about just the adjustable bases. There might be a special guest from Google about what they’re doing on there, so jam-packed Mattress University. Make sure you check it out on Nationwide Family. It’s going to be good.
Rob Stott: Fantastic.
Jeff Rose: But guess what?
Rob Stott: I know. You guys are upping it, upping it this year, Mattress-
Jeff Rose: I got one more I got to talk about, one more.
Rob Stott: It’s like the Apple moment, one more thing.
Jeff Rose: One more, so excited about this, Rob. We’ve been talking about this for a while. Mattress University has been a staple, but we’ve got its brother on the side over here. He’s been wanting to get in the game forever. All right, furniture. Furniture has been back in the corner, “Hey, Mattress University, it’s all about you. I want to get in the game.” Guess what? Furniture’s in the game now.
Rob Stott: Today’s the day.
Jeff Rose: We are launching Furniture Forum. All right. This is going to be a standalone, networked with furniture questions, answers. What we’re going to be doing is we’re really going to launch it in Nashville, really expand it in Nashville, but we wanted to have a little something special here at Virtual PrimeTime in March. We have sent out invitations, and we’re taking our first 50 members that come in. This is going to be the only live furniture and bedding session out of the whole entire Virtual PrimeTime. It’s a roundtable discussion. We’re going to break out these 50 members into 10 different groups. We’ve going to have five in each group. We’re going to have an NMG moderator.
We’ve got key questions about challenges and successes and best practices that we want to share. We’re going to have the moderators take these notes. Then we are going to compile these notes into a nice outline for the entire membership to see. We’re going to ask these questions, hear these responses, and then send it out to the membership so the membership can read and say, “You know what,” and take a look at what everybody said. I don’t know about you, I’m exhausted. I’m exhausted just from the excitement of having been on the show again.
Rob Stott: I was going to say, you talked… My watch is on this hand. You talked for a good bit. That is a lot.
Jeff Rose: Are you making fun about how much I was talking? Are you saying we’re up against the clock?
Rob Stott: Not one… No.
Jeff Rose: I know you said this was a 10-minute podcast. I know we’re 45 minutes in, I think.
Rob Stott: Not one bit, not one bit, not making fun at all. What that tells me is that there is an absolute treasure trove of information and offers and products to be excited about, and that’s just the F&B space of Virtual PrimeTime.
Jeff Rose: I know Lee over at electronics, they’re going to kill it. I know Doug and his team, they’ve got some great things at appliances. Even Chris Kirk over at member services, I know he’s got something going on. Membership, it’s going to be an incredible PrimeTime. You got to make sure you attend.
Rob Stott: Absolutely. I have a ton to look forward to. I mean, we’re hopping in and out of sessions and seeing what’s going on. We all crave that in-person. I know Nashville, if and when we get back there, it’s going to be something. Get ready. Get yourselves ready for that.
Jeff Rose: It is. It’s going to be great. I mean, I heard you might get on stage and sing in Nashville. Is that true? No, I didn’t hear that.
Rob Stott: No. You did not hear that. You did not, absolutely, did not hear that. If I am, then I don’t know. We’ll have that conversation-
Jeff Rose: I just wanted to see the fear, the fear in your face right there. It was great.
Rob Stott: I thought about it for a second. I was like, “Nah, I can’t…”
Jeff Rose: Hey, hey, Rob, I know we’re up against clock. I just want to, it’s always a pleasure being with you, man. Everyone, Rob’s got a new baby, too. Congratulations, Rob, on the new baby. I know you’re not getting much sleep, so I just wish you nothing but the best, my friend.
Rob Stott: Thank you, and you, as well. It’s always great chatting with you. We’ll do it soon in-person, and it’ll be a good time. But until then, appreciate it. Appreciate all the updates on Virtual PrimeTime and the industry. We’ll keep trucking along, man. Keep doing what you do.
Jeff Rose: Well, thanks, bud. We’ll be in touch. Bye.