And not all of them are practical.
One example of that was shared last week at the “Strategy 2010” business workshop in Tupelo, aimed at the furniture industry. The focus was to find out how manufacturers could better compete in a dynamic, global economy.
One speaker suggested that Northeast Mississippi furniture manufacturers move away from their traditional base of promotional offerings and instead go into “higher-cost, higher-quality” production.
By higher cost, he meant the price that consumers pay.
Granted, the speaker admitted that he knew little about the furniture industry, and that his suggestion was a broad one.
But it was akin to a broadside into the heart of the industry here.
“Adapt or die” was the speaker’s central point. He talked about how the steel industry reinvented itself, and how the furniture industry might learn lessons from their experience.
“You can’t keep doing what you’ve always been doing and survive,” he said.
That’s true. But getting away from promotional furniture just won’t fly in Northeast Mississippi.
The region’s furniture industry got its start when Morris Futorian introduced the concept 60 years ago in New Albany. The “upholstered furniture capital of the world” is based here because of him.
And while several companies have spun off and moved into the mid-priced and higher categories, the vast majority of companies in the region make promotionally priced furniture. It’s the lifeblood of the industry and the region, employing tens of thousands of workers directly and indirectly.
Promotional furniture is a niche of its own. Consumers want choices, and they get them with prices, styles and designs.
Furniture companies certainly need to adapt, and many do.
Because most consumers look at the bottom line, so do the companies. I don’t know of any business, regardless of the industry, not looking at controlling costs.
If not, they won’t be in business long.
But each furniture manufacturer operates differently. Some source heavily from China, others don’t. Other companies look to maintain a certain ratio.
Waiting for goods and materials to arrive via cargo ship, then via truck or train for up to six weeks can be challenging. Keeping an eye on the political and social situation half a world away also keeps executives up at night.
Having to rely on cheap Chinese labor or imported cut-and-sew kits aren’t what furniture manufacturers would like to do, but they have little choice.
If consumers continue to go for the lowest price, then companies will have to – and already do – respond by cutting some of their biggest costs, which is labor.
Can we produce more domestically? Yes, we could. But American consumers aren’t willing to pay more for the wages we pay our fellow citizens. And so it’s back to China we go.
And while much advice can be given to the furniture industry, there are few answers.
Contact Dennis Seid at (662) 678-1578 or at email@example.com. Follow him at twitter.com/dennisseid and on NEMS360.com.