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Furnishing with care

Undaunted by challenges in the retail industry, The Furniture Mall is dreaming up bold solutions - all while keeping its customers and tenants happy

'We want to bring together the entire supply chain - from when materials come in, to when furniture is shipped out - to truly become a one-stop service provider.' - Paul Keng, managing director of The Furniture Mall (above centre), with directors Michael Tan and Koh Sok Yan

FOR more than 20 years, The Furniture Mall has been helping Singaporeans create their dream homes. With 40 stores and over 70 brands, it has earned the reputation of being a one-stop destination - mixing quality furnishings with top-notch customer service. But few know about the mall's unique set-up: that it is actually run by the Singapore Furniture Association (SFA), which first mooted the concept in the 1990s. Back then, the SFA had been looking for a solution to an increasingly costly and competitive environment - a result of big furniture stores entering the local market.

Following a study mission to the United States to learn about new retailing concepts, The Furniture Mall was established in 1995 at Beach Road. The idea was to group furniture retailers together, under the same roof - enabling them to pool resources for maximum benefit.

Says Paul Keng, first vice-president of SFA and managing director of The Furniture Mall: Tenants who are also SFA members pay a nominal advertising fee, as a collective effort towards joint promotions and marketing campaigns. This way, everyone benefits. Indeed, by joining forces, members are able to enjoy cost-savings that would otherwise be impossible, if they operated independently. This includes lower rentals through the block leasing of retail space, and cost-effective advertising and promotions.

Mr Keng stresses that The Furniture Mall's set-up is truly one-of-a-kind, in that it's a mall run by a trade association which is not profit-making. "Whatever balance we have at the end of the year, we contribute back to the association. This is the only such model in the world," says Mr Keng.

New challenges, new solutions

In its 21 years of operations, Mr Keng and his fellow association members have witnessed a sea change in the furniture industry. Apart from the perennial gripes about higher business and rental costs - which affect all companies, regardless of their sector - tenants at The Furniture Mall have seen first-hand the disruptive power of the Internet.

The trend towards e-commerce, in particular, has proven particularly tricky. Notes Mr Keng: "People no longer really need showrooms to visualise furniture. They can now go onto the Internet and have 360-degree views of the space!"

To make matters worse, he has noticed a growing trend of shoppers visiting physical showrooms to suss out items in person - before buying the exact item online.

Some online retailers have also surprised of late, by entering the furniture space. This has only served to heighten competition, says Koh Sok Yan, honorary secretary of SFA and director at The Furniture Mall.

But the mall is adapting its own strategies to deal with the new challenges - including the savvy use of social media, as well as strategies to differentiate themselves from their competitors.

For one, the mall has a healthy online presence. This is important because, as Michael Tan, honorary treasurer of SFA and director at The Furniture Mall, notes: "How customers find you is important. Before they come to your showroom, they will often do a search online - so if you don't have a website, you will lose."

The mall also has an active Facebook page, which it uses to not only conduct promotions, but to also stay in touch with customers. Updates on tenants' stocks are frequently shared on Facebook, so that would-be customers are aware of available pieces and can plan their visit to the mall ahead of time. Feedback from consumers is also dealt with in a timely manner, with the quick turnaround time underscoring the mall's commitment to its visitors.

And unlike some online marketplaces that sometimes leave consumers with little recourse if and when things go wrong, The Furniture Mall works hard to ensure that customer-seller disputes are resolved amicably.

It does so through the Furniture & Interior Renovations Advisory Committee (FIRAC), which was set up in 1997 to act as an intermediary between consumers and retailers. All tenants at The Furniture Mall and SFA members enjoy free mediation service from FIRAC.

This helps to prevent disputes from escalating. While consumers' interests are protected by ensuring they receive value-for-money products and quality customer service, FIRAC also acts as a quality trademark for retailers. On top of this, FIRAC has also worked closely with the Consumers Association of Singapore (CASE) over the years - bringing quality assurance to customers.

Grand expansion plans

But beyond these "here and now" strategies, SFA also has one eye trained on the future. It plans to open a second mall sometime in the next two years, with a wholly different concept. A location is currently being sourced somewhere downtown or in a suburban area, with a size of about 100,000 square feet.

While the sheer size sounds impressive, what really sets the new mall apart is its concept. Explains Mr Keng: "We want to bring together the entire supply chain - from when materials come in, to when furniture is shipped out - to truly become a one-stop service provider."

His vision is to form an alliance with various trade associations - an idea that has popped up in his discussions with the Singapore Chinese Chamber of Commerce & Industry (SCCCI). Already, SFA has had a history of close collaboration with the Singapore Renovation Contractors and Materials Supplies Association (RCMA) - and ties are expected to deepen further.

This would mean a grouping with timber merchants, renovation contractors, logistics and warehousing providers, and even delivery services providers - in addition to SFA's members - for greater cost savings. "Having all of this centralised would be good for our retailers; they won't have to source for sub- contractors to get things done, because all the services they need will be together. There is more synergy this way," says Mr Keng.

The tenant mix may also evolve to include more than just furniture sellers - lighting and appliance shops, or carpeting and curtain retailers could also be featured. This would offer consumers a more holistic shopping experience.

Mr Keng and his team are even thinking of teaming up with developers to create pre-furnished properties. "Imagine if you can team up to develop 500 hundred homes - straightaway your sales will increase by 500 times," notes Mr Keng.

The layout of the mall is likely to be vastly different, too. While The Furniture Mall's current space at 10 Toh Guan Road features small partitioned units for each tenant, Ms Koh is pushing for a more open concept.

"We may have surrounding boutiques selling high-end products, while the centre follows an exhibition style with mid- to slightly-cheaper products. It will help to have a wide range of products, so that we can cater to a diverse customer profile," says Ms Koh.

In fact, Mr Keng is even thinking of adopting an integrated showroom concept. This means retailers will no longer operate in silos - instead of a shop dedicated to couches and another to tables, the new mall could feature different themes of bedrooms, living rooms, and kitchens. Suppliers will then be able to display their wares prominently, and alongside other goods. "This will really help customers visualise what their entire home can look like - because it's not just about one sofa or one dining table. It's about how everything works together," says Mr Keng.

It is exactly this imaginative spirit that has kept The Furniture Mall going for 21 years. Despite all the competition and headwinds the industry may be facing, SFA is proving that the future continues to look bright. As Mr Keng says: "There's no point talking about the past already. The future - that is the question."

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