▶ Ashley Furniture Homestore
▶ Elan Contemporary Furnishings
▶ Drexel Heritage-Thomasville
▶ Hilda Flack
▶ House of Denmark
▶ Rossi Furniture
Packwood's Furniture Galleries
NAME OF STORE:
Packwood’s Heritage Furniture Galleries
Packwood’s was a 40,000 square-foot, 40-year old, high-end, family-owned furniture store in the Salinas/Monterey, California area. Their galleries and vendors included Drexel Heritage, Thomasville, Stanley, Hooker, Pulaski and many of the industry’s most respected suppliers. After several failed promotions conducted by alternate industry consultants, Packwood’s found themselves at a difficult crossroads. Customer confidence was eroded and the “special events” did not achieve the promises of the consultants. Because of credit restrictions, Packwood’s could not fill hundreds of outstanding orders. The owners decided the only logical course of action was to close the store and go out of business. However, as established residents of the area, the owners of Packwood’s were very concerned about preserving their reputation and maintaining the integrity of their long-standing business, which had always operated under the highest ethical standards. Based on the recommendations of well-respected industry professionals, Packwood’s asked Deere Park Association for options to solve their problems. Several personal meetings with Richard Glabman led to the determination that the best strategy would be to first fill all sold orders, then stage a store closing event, using the proceeds to pay past taxes and personal liabilities.
Achieve the highest economic return on existing inventory, fill existing custom special orders, and provide uncompromising customer service, while preserving the positive reputations of the family and the business. Provide improved credit communication with the client’s existing bank and vendor community.
Deere Park Association started dialog with dozens of Packwood’s vendors including Drexel Heritage and Thomasville. Because of the outstanding reputation of Deere Park Association serving as a credit guarantor for sold orders, Deere Park Association was able to fill every one of Packwood’s hundreds of existing special orders, representing millions of dollars of retail revenue. As sold orders were being filled, Deere Park Association helped Packwood’s execute a high-impact, store closing total inventory liquidation event. An experienced team of Deere Park Association managers, accountants, administrators, and sales associates was put in place to assist in the management of the store operation during the four-month transition. During such time, Deere Park Association aided in credit discussions with secured lenders and the vendor community.
Sales volume in just the first six weeks of the event was more than double the store’s previous annual volume. Total net sales profit of this multi-million dollar sale after all costs was 16% of volume. Total gross margin over the entire sale was 46.9%. The owners of Packwood’s recovered full cost of their Starting Inventory and retained a significant sale profit. The owners of the store praised Deere Park Association for handling the event with integrity, and treating customers, employees, and family with dignity and respect.
▶For additional information, refer to the Packwood’s letter on the “References” page