Furniture company Sabai, which promotes sustainability in its manufacturing and shipping processes, launched right before the pandemic hit. Demand soared, but CEO Phantila Phataraprasit expected it to be short-lived.
“We realized 2020 was a launching pad,” she says. “But then we grew two-and-a-half times in 2021. Customer demand is there.”
Made-to-order furniture is how retailers Sabai and Inside Weather seek to appeal to customers concerned about sustainability and the environment. By limiting options and using domestically sourced materials where possible, these furniture retailers seek to minimize waste without sacrificing aesthetic appeal. When a piece is worn down or it’s time for a fresh look, these retailers turn to reselling to offset landfill use and/or offer repair options to help customers cut back on how much they buy.
A greener consumer
54% of American consumers care about sustainability and how their shopping habits impact the earth, according to a March 2022 report of 1,236 to 4,771 online adults (sample sizes varied by country) by Forrester Research Inc., “The New Green Consumer.” Americans lag European consumers in Italy (76%), Spain (67%), France (66%) and Germany (63%). And only 32% of Americans agree that climate change affects their purchase decisions.
While the number is lower than in some European countries, Phataraprasit said she believes demand exists to make more Earth-friendly choices if given affordable options.
Sabai creates custom couches, love seats, pillows and other home goods. Through Sabai’s Repair Don’t Replace program, customers can also refresh their furniture with new slipcovers or repair worn parts. Since launching its repair program in January 2021, sales have increased from 4% Q1 2022 to 9% in Q2 2022.
Sabai’s online retail average order value is $1,300 and has remained steady. The brand plans to expand its furniture offerings over time slowly.
“We want to build up brand trust,” Phataraprasit says. “We have to research any new products to ensure they meet our quality and sustainability standards.”
That includes sourcing within the U.S. where possible, using recyclable cardboard and skipping plastic altogether for shipping, and abstaining from using harmful chemicals.
Millennial and Gen Z shoppers care about sustainability
Inside Weather is a custom furniture manufacturer that launched in 2018. The furniture retailer owns its entire manufacturing process and supply chain and sources everything in-house, says CEO Ben Parsa. And it helps keep things moving with lead times that average about seven to 10 days, “which is, in our category, basically unheard of,” Parsa says. That lead time has increased to 20 days when materials take longer to arrive but is still below the months-long wait many consumers have experienced during the pandemic due to supply chain interruptions.
A custom, made-to-order couch ensures that customers don’t receive out-of-stock messages, a frustratingly common occurrence during the pandemic. 41% of respondents encountered out-of-stocks when shopping online for home goods, according to a Digital Commerce 360 and Bizrate Insights home goods survey in April 2022 of 1,113 online shoppers. And a quarter of respondents said they received late deliveries.
Inside Weather has doubled its AOV from 2020 to 2021, Parsa says. He noted that post-purchase surveys from customers indicated they shopped with Inside Weather because of the retailer’s production process within the U.S. and sustainability messaging.
“I think people understand when you mass-produce something, you don’t sell everything — so where does it go? Unpopular items can end up in landfills,” Parsa says. “We try to communicate how our model is less wasteful.”
Parsa did not share details of its internal manufacturing process but says compared to a traditional furniture manufacturing model, which typically outsources much of its operations, Inside Weather’s made-to-order approach cuts back on about 80% of raw material waste. That waste adds up. The furniture retailer has a catalog of offerings spanning categories, including living room, dining room, office, bedroom and décor options.
Inside Weather uses logistics software to minimize back-and-forth driving during the shipping and delivery process. Parsa says it tries to offset its shipping carbon footprint by using a “burst distribution model” for larger items like sofas. The retailer ships six sofas on one pallet that is taken to a regional hub. “Then we’ve got a final mile carrier in that region that delivers the items to the customers,” Parsa says.
Another key to curbing waste is having an on-demand production model, Parsa says.
“There is an enormous benefit in understanding what customers want and what resonates,” Parsa says. “We aren’t sitting on unused stock because we realized a model wasn’t resonating with customers. Micro-adjustments for a normal manufacturing model sitting on three to nine months’ worth of inventory is tremendously costly.
“We’re constantly reviewing purchase data and customer feedback to improve designs, so we only offer what customers want,” he continues. “The cost of doing this is infinitely lower when you’re not sitting on 10 shipping containers’ worth of stock that you need to use up before you make a change over.”
Reselling furniture as a way to be green
Both Sabai and Inside Weather use FloorFound as a reseller. FloorFound is a vendor that picks up the item from the customer’s home, refurbishes it and resells it to a new customer on its own website. FloorFound handles the logistics and receives a percentage of the sale (about 30% on average). The company inspects the used items at their warehouse using applications on mobile devices to record imperfections or damage. It determines what condition the piece of furniture is in and how to price it. CEO Chris Richter says the intention is to make it easy for consumers to resell their used items without resorting to marketplaces like Facebook Marketplace or Craigslist.
The vendor also works with retailers to process returned items, which would otherwise end up in landfills. Instead, retailers pay FloorFound to resell returned, undamaged items via its online shop. FloorFound charges retailers an annual software-as-a-service fee to run the program and technology that ranges from $25,000 to $500,000 depending on the retailer’s size and the number of returns it processes monthly.
Inside Weather experienced an 82% sell-through rate through its online resale channel. According to FloorFound, the program has saved approximately 10,000 pounds of furniture from landfills. And 34% of those buying from Inside Weather’s resale channel spent in the $700 to $1,000 range.
Sabai offers reselling through its Revive program with FloorFound to keep used furniture in circulation and out of landfills. Sabai pays customers up to 20% of the item resale price to sell it to a new customer. It did not disclose how much of its online sales are attributed to its Revive program.
“The revive program has done incredibly well,” Phataraprasit says. “All the products we list for resale sell out within 72 hours.”
Recommerce, the selling of previously owned or used products, is valuable, Phataraprasit says. “If a customer can’t afford our prices, they can still participate and own one of our products. Both Millennials and Gen Z’s are taking more pride in the spaces they build and we expect that to continue,” she says.
Stay on top of the latest developments in the ecommerce industry. Sign up for a complimentary subscription to Digital Commerce 360 Retail News.