ON A HOT SEAT
FURNITURE DEALER SEES POST-HARVEY SURGE
Conroe businessman says recovery from the hurricane has been responsible for 80% of traffic and 25% of recent sales
Helping people clean up after Hurricane Harvey has been a blessing for Chris Pfeiffer, who owns and manages Homestead House, a high-end retail furniture store in Conroe.
His store showcases a variety of furniture from upscale manufactures including Henredon, Sherrill, Lexington, Century, and Hancock & Moore.
Pfeiffer shared his insights on post-Harvey furniture sales with the Houston Chronicle. He also talked about competing with online retailers and the disparate tax treatment he faces, particularly the 8.25 percent price disadvantage tacked onto sales of companies with a physical presence.
Q: How has Hurricane Harvey affected your business?
A: It’s been positive for business. About 80 percent of our current traffic is Harvey-related. People are looking to replace their damaged furniture. Harvey has been responsible for about 25 percent of sales in the last three months.
We’ve also have been doing quite a bit of appraisals — preliminary and investigative type work for people who need to determine how much it will cost them to replace their furniture. People are gathering prices to submit to FEMA, so they need to know the value of their damaged furniture.
We sell high-quality, classic furniture at Homestead
House — not trendy lines of furniture. Since we carry furniture items that we have carried for many years, I have the prices of our furniture memorized. I’ll provide appraisals for customers who can then turn the estimates in to FEMA for cash payments. Whether they come back and buy furniture is uncertain, but we first have to help them get their settlements.
Q: What percentage of customers return after getting their appraisals?
A: We don’t know yet. The people who are buying furniture now have the financial ability not to wait for settlements. But many people do not have that ability.
People are replacing furniture in stages. The first stage is appraisals. Many people are just at this stage. However, there are other people who had recently purchased furniture from us and who just ask us to resend them replacements of everything they had already bought.
After the appraisal stage, there’s the waiting stage. People will often wait to see the amount of money they will get from FEMA.
Many people without insurance will be replacing their damaged furniture gradually, as they can afford to do so. I think that furniture replacement — the stages of appraising, waiting and replacing — will take about three years to play out.
The flood has put thousands of people back into the furniture market. … It’s not what they wanted, and they may not have enough money to quickly replace what they lost.
We are also helping low-income families and local churches by selling furniture at low margins to people who may not have the means to afford furniture.
Q: How would business be if not for Harvey?
A: Even if you take off the 25 percent of business which I estimate is due to Harvey, business would still be doing well. Our non-hurricane business is good, probably a 5 percent to 10 percent increase over last year. One thing I can tell you is that no part of Houston was unaffected. We are getting clients from all over Houston to our store.
Q: Do you build furniture?
A: No, but many of our vendors make custom furniture for us. Most of our lines come from North Carolina, the furniture capital of the world.
Q: How easy would it be for people to simply order furniture online?
A: One of the drawbacks of ordering online is that the customer cannot see and feel the furniture they are buying. When people buy high-quality furniture, they often want to see and feel it. We encourage people to come in because then there is some involvement. We can demonstrate why the higher-quality furniture is better than the cheaper furniture that’s available online. And customers are better off getting it delivered by a local furniture company rather than having a common carrier crew with no furniture experience unboxing it in their homes, if they want service, and if they want to avoid problems with shipping damage. Plus, a local company can help the customer move and set the furniture up.
Q: Are you seeing less competition from online stores? Are your customers less concerned about tax savings?
A: Yes. People need the qualified appraisals, and, if they want to replace their furniture quickly, they seem less concerned about saving money on taxes. They need attention, service, storage, and delivery flexibility. There’s too much going on for many of them to shop for tax savings.
Q: How has Amazon and other online retailers affected your business?
A: We have been less affected by Amazon than many companies. Amazon affects low-end sellers more than highend. Companies with a storefront or warehouse in Texas, like Amazon, have to pay taxes, too.
Some new websites coming on online to sell furniture do charge taxes. But some internet operations, many on the East Coast, are selling high-end furniture without charging a tax.
These online retailers specializing in high-end furniture are more of a problem but, again, it comes down to the taxing. Their prices are not better. Often the furniture they ship here arrives damaged.
Q: Has there been any progress in changing the tax law?
A: No, no progress since the Houston Chronicle’s article last year. Too many other things have happened in the world, distracting people from the tax issue. Change never happens fast enough.
Still, we are helping people find furniture and our prices are very competitive. We try to match online prices, but the tax difference needs to be solved.
Our delivery and quality of service is how we make up for the inability to discount prices further. We try to give customers a better experience.