Blog: 8 myths about High Point Market
I don’t care how big or small your home furnishings retail business is, you MUST attend the High Point Market or you will miss opportunities and give your direct competitors an advantage. The great thing about High Point is the ability to meet with noncompeting retailers and share ideas about both the front and back ends of your business. Did I mention meeting others and sharing ideas was FREE?
Myth 1: There is no merchandise to buy. Do you believe the vendors/exhibitors showing in High Point have been sitting on their hands over the past 18 months? Of course not! You will be pleasantly surprised how 90% of showrooms will have merchandise that is often quite new and different than you have seen in the past. Why? They are sourcing differently from how they have in the past, as well as adding new product categories. They have also worked on getting products here faster, too.
Please don’t ignore all the new factories and factory expansions you have been reading about, too. Some of the importers are investing heavily in North America. The port problems may not be a short-term event. We may never be able to import by ships as we have in the past.
Myth 2: You will just find the same old showrooms with the same old lines. You must be blind if you have missed the dozens of new businesses that have popped up to fill the voids the past 18 months have created. Some offer faster deliveries, some fill in price points, and some come from places you have not shopped before, like Mexico. Not everything comes in through a congested port. And these extreme logistical price increases like $30,000 for a container (?????) makes our North American manufacturers much more price and time competitive!
Opportunities in High Point will surprise you, and you will be glad you did not miss it on your way back home.
Myth 3: Everything will take forever to get here. Bull. We are talking to factories that are bragging about how they have found ways to shrink their backlogs. If your vendors remain overextended, shop around.
Myth 4: Prices will all be obscenely higher. Let’s be realistic here. Name something that has come down in price other than leather. You need to carefully compare price changes since last purchasing cycle. Why?
Some vendors pace their price adjustments weekly on different merchandise rather than making more obvious larger across the board increases. Smart vendors also consider their inventories when price increases are announced. The bigger the inventory, the smaller the price increase. Get it?
The traditional way our vendors increase prices (especially in upholstery) is by introducing lots of new frames and covers, not by putting a lot of price increases on existing lines.
I do not see a lot of vendors trying to take advantage of these inflationary times to be greedy with price increases. You might even see some showrooms have charts and graphs illustrating what they are having to pay for their raw materials, transportation and labor today to justify their prices.
Myth 5: My vendors’ prices are up 50% or more! Really? It may seem that way, I agree, especially if you have not raised your prices on your existing stock. Hopefully, you have been passing on price increases as you receive them, but that is almost impossible, we know. Truthfully, what have prices increased?
My only way to read that is the International Sleep Products Assn. statistics on mattresses. In 2021, domestic mattress sales grew 15.9% in dollars but dropped 4.9% in units, which implies pricing inflation of just under 21%. If we include imports to the sales in 2021, then the price inflation was 23%, bad but not 50% as some have claimed.
Myth 6: A recession is inevitable! A recession is defined as two sequential quarters of negative GDP growth, and that is unlikely, in my opinion. GDP growth will not keep up with its recent pace, but it should be positive for the remainder of 2022. We review a lot of very boring economic forecasts, and most are more subdued than they were earlier this year before the Ukrainian invasion, but the only ones mentioning a recession have a political reason to make that claim. Always look at who is making the forecast and what their motives might be.
Myth 7: Higher mortgage rates may stop our housing recovery. Yes, rates are already back to 4%, but who among us above age 40 thinks a 4% mortgage is high or prohibitive? Yes, I believe mortgage rates will be going higher, but one first result will the incredible price increases for houses will slow for existing home sales. New homes may see further price increases due to rising raw material costs.
Myth 8: Rising gas prices will keep people from going to High Point. Give me a break! They aren’t keeping you from going to your beach house in Florida, are they?