Furniture Import Business Plan

Poppi Designs’ product line is rather extensive, amounting to over 200 items including, chairs, stools, dressers, book shelves, mirrors, screens, side tables, dining tables, lounges, etc. Because of the large quantity of items and styles, it is not feasible to stock all these items, however, any of these items can be purchased from Poppi by special order. Because of the long lead time between ordering and arrival of the goods, Poppi has found that it must concentrate on a limited number of items which suit the targeted market sectors, and to try to keep a stock in these items ready for immediate delivery.

3.1 Competitive Comparison

Probably the most notable competitor seen in retail outlets of the type targeted by Poppi Designs is from Chapman International. The Chapman catalog is excellent and in color. All items in the catalog are available immediately, unfinished, from stock in Delaware. Below is a price comparison:

The finished prices listed above for Chapman include their standard finish which is applied in Italy. For a finish which Chapman calls “Premium” (giving a distressed or antique look) an additional $25 (for side chair) or $35 (arm chair) is charged. This additional charge should be considered when comparing the level of Poppi finish work.

Taking this into consideration, Poppi’s prices for the items mentioned above are higher than Chapman’s. It should be mentioned that only the Renaissance approaches a close comparison. The other two compared models of Chapman, although roughly similar when viewed from a distance, are far less substantial when examined up close. The Chapman chairs weigh much less and have very little carving work when compared to Poppi’s chairs.

Competitiveness from point of view of price is an important factor and looms larger once the retailer’s margin has been tacked on. The price difference in respect to Chapman should not be a problem for Poppi, given the higher quality of Poppi’s chairs. However, pricing is only one aspect of competition. Chapman has an excellent color catalog and all items contained in it are readily available from stock kept in Delaware. Some market sectors might be expected to lean in Chapman direction if Poppi has problems delivering in a timely manner. “Timely deliveries” has been underscored in the “Objectives” section of this plan.

A price comparison was also performed for unfinished chairs targeted for the designer market. The two major New York furniture import houses (Columbia and Atlantic) were chosen for comparison purposes. The item compared here is in all three cases the identical chair, most probably produced in the same factory in Italy:

Columbia’s Item#382S and 382A ……… $255 and $283 respectively (raw)

Atlantic’s Item#7616S & A ……………..$275 and $295 respectively (raw)

Poppi Designs’ equivalent………………………………….$217 and $290 (raw)

Comparing prices on a finished basis is a bit more difficult because of the wide range of finish options, but Poppi’s finished, upholstered price of $417 and $490 for the side and arm chair respectively compares with Columbia’s prices of $448 and $482 and Atlantic’s prices of $490-605 (depending on type of finish) for the side and $525-645 for the arm chair.

3.2 Sourcing

Poppi Designs’ products are imported from Italy through an agent who receives a 7% commission. This agent, Luca de Febonio is a 50% owner of Poppi Designs, and their relationship is long-standing. The agent is responsible for arranging production schedules with the various local factories and handles all matters that arise until the point when goods are ready for shipment. Payment is made by Poppi directly to the producing factories at the prevailing exchange rate for Italian Lira.