June 14, 2021

Most people want to sit on a piece of furniture before they buy it.

That’s the case whether it’s a single sofa – or in the case of FurnitureMart USA – potentially hundreds of them.

So when chairman Bill Hinks went to North Carolina on a recent trip to a major industry market, he dug in as he has for 45 years, testing out pieces and gathering information on trends.

“It was really good,” said Hinks, 82, who founded the business with a single store on West 12th Street in 1977 on property connected to a mobile home lot he owned.

“There’s a whole new approach.”

The furniture business is an interesting place to be in 2021 as consumers tastes vary widely from more traditional to “this totally new look” embraced generally by younger buyers, Hinks said.

“Mom would buy a sofa and have it 20 years, and that’s sort of done now.”

The pandemic was kind to many businesses that support at-home living, including the furniture industry, as consumers spent more time at home and were inspired to improve their spaces – bolstered by government stimulus.

“People have decided to spend more money on their house, and some want a desk or a little office to work from home, so a lot of that has been good for us,” Hinks said.

“It’s trying to stay ahead of the game, which is always changing.”

Furniture Mart, which is the nation’s 35th-largest furniture retailer, had a record year in 2020 and is ahead of it in 2021, he said. The company includes more than 40 stores in a six-state region. In Sioux Falls, that includes Ashley HomeStore, Furniture Mart, Carpet One and Unclaimed Freight Furniture.

There are more than 1,250 employees companywide with nearly 300 at the Sioux Falls corporate office.

But it’s about to grow even more.

Construction has started on a 300,000-square-foot addition to the corporate headquarters campus at 140 E. Hinks Lane in north-central Sioux Falls that will double it in size, adding an Ashley and Furniture Mart location along with more warehouse space and making it one of the largest buildings in Sioux Falls.

Renderings by Architecture Incorporated

At a “company’s home base,” there’s an ability to show more product, Hinks said.

“People know they can load it up and take it home. Sioux Falls is growing at such a rate that to have two stores here and a little clearance center toward the back of one, it’s an opportunity for them to come in and look or if they’ve been looking already and want to pick it up and take it home.”

While construction has started, a more formal groundbreaking is planned this summer, and completion is scheduled for the first quarter of 2022. In addition to the warehouse space, the Ashley and Furniture Mart stores each will be about 40,000 square feet, plus a 10,000-square-foot clearance center.

The flow of product within the campus also will be improved, Hinks said, with better access for trucking and picking up merchandise. That’s necessary to compete with online retail, he added.

“If we’re going to sell you furniture, you’re not going to wait two weeks to two months,” he said. “Where we have an advantage is if we get them in the store and they sit in it and feel it and want it. There it looks pretty. So we’ll have 80 percent of our bestsellers in stock, and we’ll have it if they want it in a couple days or maybe even the next day.”

Capturing opportunities

The pandemic and broader retail climate also provided opportunities in real estate.

Furniture Mart recently opened an Ashley store in Cedar Falls, Iowa, in a former Younkers department store.

Those are the sort of moves that motivate Hinks, who has a broad real estate portfolio that includes the Western Mall in Sioux Falls.

“There are so many opportunities out there,” he said. “All these companies have closed up, they all have big huge buildings, and they’re all empty … but I want to look at it 10 times before I decide we’re interested in it.”

He also recently bought a site in Austin, Minn., that was a former Target and one in Duluth where he anticipates putting multiple retail stores.

To support the growing business, Furniture Mart also has enhanced its corporate office, including its customer care center. The renovated space allows for 40 employees and is staffed daily with extended hours.

“As we’ve grown, we’ve tried to add people with experience … and people who can really grab hold of the furniture industry,” Hinks said. “The furniture industry itself is an amazing challenge. It’s always having to keep itself up to date, always making changes.”

That demands leaders do the same, he said. Longtime CEO Jim Heinitz retired late last year, and Hinks announced the following leadership team:

• Tami Wallenstein, executive vice president, is the lead buyer on all accessory purchases. She also works with accounting, human resources and philanthropic requests. Wallenstein has been with the organization for 35 years.
• Gordy Wallenstein, president, has been with Furniture Mart USA for 41 years. He evaluates inventory levels, productivity and selects showroom inventory with the buying team, researching market trends, current fashions and potential suppliers.
• Cory Price, president of strategic planning and company development, brings together Furniture Mart USA’s sales and marketing efforts through leading the customer experience teams. In addition, Price has served as corporate pilot for the past 10 years.
• Troy Eichmann, chief operating officer, is responsible for company operations and the strategic operational direction of Furniture Mart USA. He oversees the company delivery process, supply chain management, operations of the distribution centers and customer delivery. Eichmann has held leadership positions with Fortune 100 companies, including Delta Air Lines and Starwood Hotels & Resorts.

“If we don’t have a happy customer, we don’t have a customer,” Hinks said. “That’s one of our biggest plans is to try to make everyone happy. Sometimes it isn’t possible, but our teams have worked very hard and worked together to try to solve the things that needed to be done.”

That includes leveraging technology, so delivery is more seamless and efficient.

“We’re building a really good crew,” Hinks said. “And quite a few of the older stores are closing, and then you have people with experience, so it’s worked out really well.”

Though he now counts 59 stores in 46 markets, Hinks isn’t done.

“We’re growing with Ashley stores, but we know we need to grow with our Mart stores, and we’re looking at a couple (sites),” he said.

Consumers also are changing their habits and purchasing furniture more frequently, he added.

The newer product lines are “like sitting on a cloud,” he added. “The fabrics are so soft, it really is nice, and some of the bedroom sets have really nice stylish looks.”

That’s not to say the industry is without challenges. In the short term, the supply chain has been constrained by multiple factors, including trying to secure product from overseas.

Ashley, which Hinks estimates is the nation’s fifth-largest user of shipping containers, is even struggling to book them. The cost of the boats themselves is going up, and when the inventory arrives, there are labor-related delays unloading the containers and trucking the merchandise to its final destination.

“I’m sure eventually people will be back working, but that’s what’s happening now,” Hinks said.

Closer to home, he continues to emphasize philanthropy. Every new store opening includes an event where free beds and bedding are given to kids in need, which is just one example in a long list of nonprofit support.

“We’re partners, and we do a lot of charity work, and we love it, and we love the opportunity to get involved,” Hinks said.

“You just have to look at our community and say: What a city.”