CHAIR KING® Backyard Store in the News
As seen in Hearth & Home September 2015 Issue
L to R: Marvin Barish, son David, daughter Jacquelyn and her son Joseph Weisman.
Selling exclusive product while overwhelming the customer with their breadth of assortment has made the merger of Chair King and Fortunoff Backyard Store one of the largest retailers in the patio furniture industry.
The nation's 58th largest furniture retailer stands out among its peers because it does not sell leather recliners, casegoods, mattresses or other mainline furnishings.
Number 58 on Furniture Today's current list of the Top 100 U.S. Furniture Stores is a specialty merchant, focusing on the outdoor category. Last year this enterprise enjoyed sales of more than $111 million. That number is expected to increase by around 10 percent this year.
Chair King Backyard Store and Fortunoff Backyard Store, with David Barish at the helm of both operations, count 43 retail locations between the two brands. In an industry that considers a retailer with six or eight locations a substantial player, Chair King/Fortunoff surely is one of the top outdoor specialty retailers in the land.
What makes this all the more amazing is that, six years ago, Fortunoff was little more than a beloved memory. The store that endeared itself to generations of shoppers in the greater New York/New Jersey area, offering everything from jewelry to outdoor furniture, went through ownership changes and two bankruptcies before calling it quits.
Meanwhile, Chair King's Barish was doing quite nicely in Texas, and had no designs on expanding to the East Coast.
That's when the phone call came one Friday afternoon in August 2009.
Marty Merkur, a longtime friend of the Barish family, was on the line. He had been a merchandising executive with Fortunoff for 39 years before the venerable chain went under, a casualty of the Great Recession.
Merkur, Barish recalls, had a plan to resurrect the Fortunoff name by concentrating on outdoor furniture. "He asked if Chair King would help with the merchandising," Barish says.
In the course of that conversation, Merkur mentioned that his executive team at Furniture Concepts also was looking for investors. That's when the call became much more interesting.
"Maybe Chair King would be willing to be the investor," Barish recalls saying, "where we could then be involved on a strategic level and really make this thing successful."
A meeting was set up for the following Sunday. Barish thrashed out the framework of an agreement with Merkur and Bernard "Bernie" Sensale, an experienced marketing executive recruited to the old Fortunoff as the retailer struggled through its final bankruptcy. Before the day was over, the negotiators had come to terms.
"Within two weeks, we had a legal document negotiated and signed," Barish says. The deal was struck just in time for the team to attend the 2009 Casual Market "as a legal entity that was already created and funded."
Furniture Concepts, LLC, a subsidiary of The Chair King, Inc., operates Fortunoff Backyard Stores. Barish, president and CEO of Chair King, is chairman of Furniture Concepts.
The speed at which the deal was consummated seems impossible in this over-lawyered era. But Barish, who left an academic career to come into the family business in 1980 and started negotiating deals with Chinese factories in 1983, is matter-of-fact about it. He holds a doctorate in Jewish history and late antiquity.
"When you are an entrepreneur and can control your own destiny," he says, "it's very easy to jump on opportunities that come before you."
Bernie Sensale, CEO of Fortunoff Backyard Store, grew up in the market served by the iconic Fortunoff stores. He had a general appreciation for the relationship between the brand and its customers. But he had no idea of the depth of that love until the first Fortunoff Backyard Stores opened in February 2010.
An ice storm struck the New York area on opening day. Still, customers came. They came just to see if the news reports were true. They asked, tears welling their eyes, "Is Fortunoff really back?"
"I was dumbfounded," Sensale says. From that day forward, he was even more convinced the Fortunoff team was on the right path.
Chair King's Barish had not been the only interested party when Furniture Con-cepts started putting out feelers, looking for investors. Others understood the power of the Fortunoff brand, which the Furniture Concepts team had licensed from the Fortunoff family. Isadore Mayrock, also with Furniture Concepts, is a member of the family.
But, Sensale points out, "We thought Chair King was the best possibility because of what David would bring to our business. His operational knowledge, credibility, and knowledge of the industry would be crucial to the success of our business
"And that turned out to be exactly right," Sensale says. Barish and Chair King "have turned out to be phenomenal partners."
Sensale had not known Barish prior to the Sunday morning when he, Merkur and Barish "hashed out a letter of intent." The two quickly grew to respect one another.
"I became impressed and decided that I liked him," Sensale says. "He was interested in organizing things in such a way that was good for the business and good for the individuals."
Barish is equally complimentary of Sensale. "My instincts were correct," he says. "He's been a great CEO and learned the business very quickly."
Fortunoff Backyard Store launched in 2010 with seven locations. Three more followed in 2011, and another three in 2012. Now there are 19 in the Northeast, including one in Delaware.
The company opened its initial three stores in Florida in 2013, and more followed. Fortunoff's sixth Florida location opened in Naples in August, for a total of 25 Fortunoff Backyard Stores.
Three additional stores are planned to open in the Northeast next year, Sen-sale says. Locations have been chosen but will not be made public until leases have been signed.
Sensale readily admits that the company's rapid growth has been possible, at least in part, because many Fortunoff veteran employees signed on with the new venture.
The old Fortunoff, Sensale says, "treated their people very well. To our great fortune, a lot of those folks were available when we restarted the business.
"We have more 20- or 25-year employees than any six-year-old company ever had," he says. "We had a lot of head-starts."
Fortunoff Backyard Stores in Florida are casual furniture only, while the Northeast stores bring in Christmas products for that short but intense season.
Much of Sensale's experience prior to joining Fortunoff in its previous incarnation was in the jewelry business, with an emphasis on marketing. That background has served him well in transitioning to the world of outdoor furniture, which, like jewelry, is typically a discretionary purchase.
"We have a good, better, best type of merchandising strategy," Sensale says, "which means we can cater to a wide swath of the population."
That approach parallels Chair King's merchandising. Another shared philosophy is concentrating on private-label goods. Visit a Chair King or Fortunoff store and you'll probably see furniture built by Agio, Northcape International, Hanamint, Trea-sure Garden, Erwin & Sons, ScanCom and a host of other vendors. But the fur-niture and umbrellas won't carry those brands; they bear proprietary labels not found in other casual stores or catalogs.
The goal is to make each item "unshoppable" and unique in the market.
"Our product mix is virtually all exclusive," Sensale explains. "We do that to provide a different offering to our customers. We think we put good value on the floor in terms of style and quality. Part of our value proposition is breadth of assortment by style, color, customization, and by price point, too."
Chair King's merchandising approach is to hook customers instantly.
"We want to overwhelm the customer so that when they walk in, they can visualize what the furniture will look like in their own backyard," Barish says. The goal is for customers to become "so wowed that they can't dream of going anywhere else."
Sometimes unions between companies with different histories and serving different regions prove to be difficult undertakings. The relationship between Chair King and Fortunoff has been just the opposite, the executives say.
"Our corporate philosophy is very much the same" as the legacy inherited by the current Fortunoff organization, Barish says. Chair King, he says, is "a value-oriented, consumer-dedicated company. We rely on our employees to present our company with their best foot forward. Fortunoff operates in exactly the same way.
"For us to partner in the way we did was almost inevitable," he says. "It was a very simple merger of personnel and ideas."
Sensale, who notes that the companies are operated independently, agrees that the firms have much in common. Sometimes they order merchandise together "because it makes sense."
"The shared values and attitude have been instrumental in helping us get to places where we can continue to grow the business," he says. "David (Barish) and I talk every day."
Fortunoff Backyard Store has enjoyed meteoric growth.
"In terms of volume, we were bigger than Chair King pretty quickly," Sensale says, "because of the markets we're in, the importance of the brand, and the skill of the associates who have been doing it for so long."
Barish says Fortunoff "does far more volume than Chair King. I would say it's 50 percent bigger."
Part of the reason for Fortunoff's advantage is population density, Barish says. Though Texas is the second-largest state in terms of population, with nearly 27 million people, they are spread out in the largest state in the lower 48. There are simply more people per square mile in metro New York/New Jersey.
"For Chair King, a $2 million to$3 million store is very nice," Barish says. "In the Northeast, we are looking for $3 million to $5 million stores, and we're not happy unless we achieve that."
Fortunoff's expansion into South Florida presented a challenge.
"I think everyone would say we had a learning curve to understand the merchandise needs of the Florida customer," Barish says.
Fortunoff's initial Florida product offering was similar to that in the Northeast stores or in the Chair King stores in Texas. Looking back, Barish says, there was too much cast aluminum and too many darker colors.
"Now," he says, "we have a lot more wicker on the floor, cleaner lines, more pastels ... a very different look than when we first opened."
Sensale says the company didn't go into the Florida market "with any illusions." There was an appreciation that lifestyles and furniture preferences were different in Florida. The uncertainty lay in exactly how things differed from markets where Fortunoff and Chair King had experience.
Fortunoff's challenge was to get established in Florida, learn about the market as quickly as possible, and adjust. Sensale says the company got through those growing pains swiftly and now, three years in, feels at home. Barish agrees, noting that the Fortunoff team has advanced its knowledge of the Florida market with each passing season.
With so many transplants from New York and New Jersey in South Florida, Fortunoff Backyard Stores found quick consumer acceptance even if the initial product mix was off. "It's amazing how people's tastes change as they move from one state to another," Barish says with a laugh
A Supplier's Perspective
Michael Gaylord, National Sales man-ager for Agio, describes Chair King and Fortunoff as "consummate mer-chants. Young people don't understand the meaning of the term, but that's the highest accolade you can give to a retailer. There's a very logical, cog-nitive approach to what they do."
Agio is a supplier of private-label outdoor furniture to Chair King and Fortunoff.
The casual furniture business remained profitable for the old Fortunoff, Gaylord says, even as the company slid into bankruptcy, burdened with soft sales in jewelry and other luxury goods. "Their last year was our best year with them as a customer," he says.
Gaylord says the retail giants excel because executives push to not only identify casual furniture trends early, but stay ahead of them.
"These guys are developing the things they want to put on the showroom floor," Gaylord says. Chair King and Fortunoff "are not just taking what they see" offered by suppliers.
The push for unique product, Gaylord says, ensures that the retailers will give consumers a unique experience with unshoppable products.
"The product we bring in from Agio is not what you would see on the sixteenth floor of The Mart," Barish says. "It's a proprietary product made only for us."
"They do their due diligence," Gaylord says. "By doing all that work, they want to have their name on it. And their customers know they are getting the best the specialty arena has to offer."
Chair King and Fortunoff, Gaylord says, have established themselves as "the destination location" for patio furniture in their markets. Shoppers understand they do themselves a disservice "by not going to see what (the two merchants) have to offer."
The retailers also strive to fulfill customer orders from stock on hand whenever possible. Chair King's philosophy is that retailers "must be doing something wrong if customers don't see what they want."
"Our stock position will satisfy 99 percent of our customers," Barish says. The remaining one percent may still special-order cushion fabrics if necessary.
Points of Pride
Chair King, an existing business purchased by David Barish's father, Marvin, in 1973, remains a family enterprise. The elder Barish, a certified public accountant now 88, comes into the office every day. "He still contributes," his son notes.
David Barish's sister, Jacquelyn Barish, is senior vice president for Chair King. Her son, Joseph Weisman, is vice president of Merchandising.
Chair King went into the Great Recession with 17 stores and retains that number today. Eight are in or near its headquarters city, Houston; the Dallas-Fort Worth area has four locations; Austin has three stores, and San Antonio has two. The company also operates a to-the-trade showroom, Leisure Collections, at the Houston Design Center.
The world oil glut has softened the usually vibrant Texas economy, Barish says, and jobs have been lost. The commercial real estate market, however, "is still very tight." The company plans to open additional stores when the timing is right.
"We have never, and will not, open locations just for the sake of opening locations," he says. Doing so would run counter to the Chair King way of doing business.
Chair King and Fortunoff employ more than 450 individuals who help support an equal number of families, an achievement in which Barish takes great pride. The two companies annually donate back to their communities a percentage of their profits.
"It's our firm belief that we got here with the help of many people," Barish says. "We know there are many people less fortunate than we, and we want to help pull them up to be able to be in our shoes, as well.
"I always tell my employees that we are here to sell furniture, make money, and have fun doing it," he says. "We all seem to do that."