New Furniture.com debuts with new business model and retailer alliance
What’s in a URL? For the new Furniture.com, scheduled to debut online this week as a new incarnation of the failed furniture retailer of the same name, plenty. Furniture.com president Carl Prindle says the group that organized to launch the new Furniture.com paid the bankruptcy court $1 million for the URL and web platform of the former Furniture.com, and he’s betting it will be worth every penny.
That’s because Prindle, one of a number of new Furniture.com principals who’d been with the original company, believes the name and URL help tackle one of three major problems the new company has identified in the former company’s business model. “We were trying to build a brand as a stand-alone online from scratch. At the same time, there were issues with the shopping experience. You couldn’t sit on a sofa before buying it.” Then there was fulfillment – the old Furniture.com was drop-shipping from as many as 200 different retailers across the country.
Prindle says the name and URL will go a long way toward branding. “It’s memorable and concise; you see it and you know what we do,” he says. The rest of the new model hangs on the new Furniture.com’s marketing alliance with two multi-store regional furniture retailers, Levitz and Seaman’s. Under the agreement, the two retail chains, which together account for well over 100 stores, will be including the Furniture.com URL on all of their advertising and collateral materials. Though both retailers had web sites previously, they weren’t transactional. The retailers also will serve as local showrooms, warehouses and fulfillment centers for Furniture.com, which gets a percentage of sale on any of the retailers’ products sold on the web site.
Prindle says working with the larger retailers will shrink the usual 8- to 10-week delivery time on new furniture to 7 to 10 days for Furniture.com. “They’re good at demand forecasting, they know what sells and they keep it stocked in inventory,” he says. “They’re about as close as you can get to a just-in-time model in this industry.”
With Seaman’s stores concentrated in the Northeast and Levitz stores in the West, shoppers in other parts of the country for now will not be able to order online from Furniture.com, though Prindle says he’s in discussion with additional retailers. Visitors will be encouraged in several places on the site to enter their zip codes for immediate information on whether goods can be delivered to their areas. Those out of delivery range will be encouraged to stay and browse the site, which will feature an online magazine of design and decorating trends updated at least monthly. Shoppers from “enabled” zip codes can track their orders and even schedule delivery online, says Prindle.
New York-based venture capital firm Resurgence Management Associates has agreed to fund Furniture.com to the break-even point, and it’s a safe bet that Furniture.com hopes that its VC backers’ name also describes the direction of the new company they’ve built from the old one. “In our minds, the business model of the old company was just starting to show legs when it closed in November of 2000,” Prindle says. “We were making a significant amount of money on every sale, although the company itself was not profitable. We want to do what we do best -- presenting and selling furniture online -- by marrying that function to the strength of larger retailers.”
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