Furniture Retail Expert Shares Winning Strategies for 2025
February 20th, 2025 by the STORIS Marketing Team
David McMahon has spent decades helping furniture retailers optimize inventory, increase profitability, and improve operations. As the founder of PerformNOW, a leading consulting firm specializing in retail performance, he works with businesses across North America to refine their strategies using data-driven insights and real-world experience.
Late December, Furniture World Magazine published his latest article, focusing on how home furnishings retailers can prepare for 2025—a year where inventory management, pricing strategies, and customer experience will define success. To dive deeper into these critical topics, I sat down with David to discuss what retailers should prioritize as they look ahead.
Inventory Management in 2025
Throughout our conversation, David emphasized that success in 2025 is not just about keeping shelves stocked but about making strategic decisions that align profitability with customer expectations.
“Inventory is the lifeblood of retail; managing it efficiently can make or break a business.”
At STORIS, we understand that inventory is more than just products in stock—it’s a retailer’s greatest asset. Managing it effectively ensures cash flow, protects margins, and prevents costly overstocks or shortages. According to David, the most successful retailers are those who proactively adjust their inventory strategies rather than waiting for market conditions to dictate their next move.
“Everybody needs to keep an eye on their costs anyway, but especially now,” he said. “The most important things to monitor are best sellers, special order items, and new merchandise that’s untested.”
For bestsellers, reacting quickly to cost increases is crucial. If retailers receive a cost notification, David advises them to adjust prices immediately rather than waiting until the new inventory arrives and absorbing the margin loss. Special order items, he noted, tend to be less sensitive to price fluctuations because customers already expect to pay a premium for customization.
New merchandise presents a different challenge. “New products are a gamble,” David explained. “If you buy untested items at the wrong time, you could be sitting on a lot of unsold inventory.” Because of this, he recommends closely tracking sell-through rates on new items before making large purchasing commitments.
Leveraging real-time tracking and forecasting tools can help retailers stay ahead of these inventory challenges. STORIS’ Inventory Management System enables businesses to analyze sales trends, automate replenishment, and integrate inventory tracking across multiple channels. These capabilities ensure that retailers always have the right products in the right place at the right time.
Pricing Strategies – How to Protect Your Margins in 2025
With fluctuating costs, retailers who fail to adjust pricing effectively risk either losing margin or alienating customers. David highlighted how price adjustments must be approached strategically, rather than as simple markups.
“When costs go up, retailers have two choices: raise prices or take the margin hit. But it’s not just about increasing prices—you must consider how it affects your entire pricing lineup,” he said.
For example, if a $1,999 sofa suddenly needs to be priced at $2,299, does it still fit within the customer’s expected price bracket? If not, retailers must rethink product positioning to maintain sales volume while protecting profit margins.
One of the key metrics David relies on is GMROI, which helps retailers determine whether a price increase is sustainable or if a product needs to be replaced with something new. “If a bestseller stops turning because of a price increase, you have two choices: drop the price and take less margin or replace it with something new in the lineup. Your GMROI will tell you which move makes the most sense.”
For automated price adjustments, retailers can rely on STORIS’ Furniture ERP to provide dynamic, data-driven pricing tools that maintain profitability and customer satisfaction.
Reducing Inventory Loss – Addressing Internal vs. External Risks
David pointed out that internal losses from operational inefficiencies often have a greater financial impact than external risks.
“The biggest losses come from damaged goods and process failures,” he explained. “If you have a high volume of credit memos, refusals, or returns, that’s where you’re bleeding money.”
To reduce these losses, retailers need to identify patterns and address them systematically. One of David’s top recommendations is implementing a structured warehouse tracking system. By creating designated holding areas for returned or damaged goods, retailers can categorize losses, spot recurring issues, and take action before they impact the bottom line.
“If you see the same type of damage happening repeatedly, it’s a red flag that needs to be addressed,” he said.
For real-time inventory tracking and loss prevention, STORIS’ Supply Chain Digital Tools provide end-to-end visibility across warehouses and stores, ensuring that every product movement is accounted for.
Why Customer Experience Matters More in 2025
While inventory and pricing strategies are essential, David emphasized that customer experience is what truly sets top-performing retailers apart.
“At the end of the day, everything we do—inventory management, pricing strategies, technology investments—it all comes back to creating the best possible experience for the customer.”
Retailers today must go beyond the transaction and focus on building long-term relationships. From the first interaction to post-purchase follow-up, customers expect a seamless experience across every touchpoint.
“It’s not just about making a sale,” David said. “It’s about making the customer feel valued at every stage. That means capturing leads effectively, simplifying the in-store experience, keeping them informed on their order, and having a great process in place when issues arise.”
Retailers can personalize interactions, automate follow-ups, and ensure every customer feels valued—before, during, and after a purchase with tools and services provided by STORIS and PerformNOW.
“The best retailers don’t just sell furniture—they create an experience that makes customers want to come back,” David said. “The ones that do that best will win in 2025 and beyond.”
Final Thoughts – Preparing for 2025 Success
After speaking with David McMahon, one thing is clear—2025 will favor retailers who are proactive, strategic, and customer-focused. Those who embrace real-time inventory management, smart pricing strategies, and seamless customer experiences will gain a competitive edge in the home furnishings industry.
For retailers looking for expert consulting and tailored strategies, PerformNOW provides actionable solutions to improve operations and profitability.
To explore how STORIS can help you optimize inventory and grow your business in 2025, schedule a demo today.
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