World Market Center could lead to demise of San Francisco Mart

Jennifer Shubinski

Saturday, Nov. 13, 2004 | 12:12 p.m.

WEEKEND EDITION

November 13 - 14, 2004

SAN FRANCISCO -- Many furniture-industry insiders think Las Vegas' World Market Center could lead to the eventual demise of the San Francisco Mart.

The early warning signs already could be appearing, with the pullout of some companies, including furniture-manufacturing giant Lane Home Furnishings.

The San Francisco market is held twice a year, in January and July, and is open only to the trade, those people who buy wholesale for furniture retail stores.

After the January market, Lane will pack up its showroom for good and head to Las Vegas.

"The San Francisco market will be extinct within a year; all the dealers will go to Las Vegas," said Randy Spak, president and chief executive of Tupelo, Miss.-based Lane.

The San Francisco Mart was founded in 1915, in part because of the difficulty West Coast manufacturers had in shipping their products to furniture shows back East.

"This market started when it did because getting anything across the Rocky Mountains was a hindrance," Ellen Hall, San Francisco Mart spokeswoman, said.

The speculation as to what will happen to the San Francisco Mart is in part because of the timing and expected size of the Las Vegas World Market Center.

(There is a "piggyback" furniture show in San Francisco that runs at the same time as the San Francisco Mart. The exhibit space for both shows totals 2 million square feet.)

While large manufacturers serve as anchor tenants at furniture markets, the bulk of the space is taken up by smaller manufacturers.

Mark Markos, co-owner of Elite Products of Corona, Calif., said he never was given the opportunity to expand his 1,000-square-foot showroom in San Francisco despite being in the same space for 10 years.

In Las Vegas, Markos will have a 3,800-square-foot showroom.

"We're still here for one more market," he said, sitting on one of his signature foam couches. "It will be interesting to see if anybody shows in January. The whole feeling is that it's done."

But not every exhibitor is ready to throw in the towel just yet.

Dennis Burgette, chief executive of Broyhill Furniture Industries of Lenoir, N.C., said the company hasn't decided whether its long-term plans will include shows in both San Francisco and Las Vegas.

The company already has signed a lease for 20,000 square feet at the World Market Center, compared with 12,000 square feet at its San Francisco showroom. And Burgette admits he doesn't see much of a need for two West Coast furniture markets.

"It's kind of a wait-and-see thing," he said. "I'm very optimistic about the success of the Las Vegas market."

Mark Hedden, director of sales and marketing for the Western district of Flexsteel Industries Inc., said the company hasn't decided whether to forgo the San Francisco Mart, despite having more space leased in Las Vegas than in San Francisco.

"My own personal opinion is that a number of manufacturers didn't renew their leases (in San Francisco) if they're going to Las Vegas," he said.

Burgette said the bottom line is the buyers (for retail stores) will go where the manufacturers show.

Jeffrey Child, president of RC Willey Home Furnishings, based in Salt Lake City, said he knows he and his buyers will be at the Las Vegas show when it opens in July. The company has two Las Vegas-area stores.

"If there are manufacturers here (San Francisco) I need to see, then I'll come here," he said.

Humberto Ojeda, whose father owns furniture stores in Hermosillo, Mexico, acts as a buyer and translator for the company. Ojeda has been attending the San Francisco Mart for 10 years but said he will have no qualms about shifting gears and attending the Las Vegas show.

"It's closer and cheaper, the hotels are cheaper, it will be easier to move around, and we want to have fun at night," he said. "We can have fun (in San Francisco) as well, but it's a different kind of fun."

Many of the summer market's 7,000 to 8,000 attendees are from California and nearby states and find it easy to hop a short flight for a day or two.

"This is just easier for me; I'm three hours south of here," said Jeanne Gibson, owner of Gibson & Co. Home Furnishings & Accessories in Paso Robles, Calif.

But Gibson said she would be interested in attending the Las Vegas show if for nothing else than to see what's there.

Hall said the World Market Center has caused San Francisco officials -- and even those in High Point, N.C., and other regional markets such as Tupelo -- to "sharpen our pencils and improve the way everybody does business."

The San Francisco Mart has undertaken some major capital improvements in the past couple of years, including replacement of all windows and upgrading bathrooms, she said.

But there are some things the show may not overcome. The San Francisco Mart's buildings are on Market Street, near the Civic Center area, nestled between the South of Market and Tenderloin areas. Homeless people and vacant storefronts are common outside the San Francisco Mart, and most market attendees do not stay at the one nearby hotel. Instead they stay in the Union Square area, a short bus ride away.

Exhibitors and buyers in San Francisco complained about the elevators, which are small and so overloaded that they often leave people waiting for 10 minutes or more.

"This market (San Francisco) has allowed the idea for Las Vegas to be created because they rested on their laurels for so long they had no competition," Spak said. "The guys in Vegas gave them a dose of reality."

Hall said rumors about the demise of the San Francisco market are untrue. She said there will be a show, as planned, in January.

"I know there is a lot of speculation, but as Mark Twain once said, 'The reports of my demise are greatly exaggerated,' " she said.

Many exhibitors complained during the summer market that attendance and sales were even slower than past summer markets, which generally lag behind attendance compared with the winter shows in January.

The apparent slowness of the summer market could be seen throughout the 11-story second building, with salespeople sitting around and often not a single buyer in sight.

That caused Markos to send home all but two of his salespeople.

"It's just dead," he said.

Whether the show may evolve from a regional one that caters to West Coast retailers to one that will cater to interior designers and others in the design trade is still up in the air.

Hall said the management is encouraging exhibitors to stay open year-round.

"The Bay area is such a large area to draw from for the year-round business," Hall said.