When mergers and acquisitions happen, integrating the two parties can be a complicated process that takes years. But when the dust settles and the united companies come out, the game is on.
That’s the case for Sunset West, which recently had its best High Point Market ever in terms of new accounts opened, and it has settled nicely into its new home as the outdoor brand of Hooker Furnishings.
Nearly three years ago, Hooker acquired Sunset West, rocketing the company to a West Coast warehouse that’s twice the size of its previous Vista, California, location. It also moved a large amount of product to Hooker’s Savannah, Georgia, warehouse.
And the synergies continued. Sam Moore, which is an upholstery company operated by Hooker, started manufacturing Sunset West’s stock cushions in Bedford, Virginia, which are then easily sent down to Savannah.
“We have tons of stock cushions and frames in Savannah that ship almost immediately,” says Sunset West President Wes Stewart. “Our ability to service our customers is now six times greater than before Hooker purchased us. And our inventory levels are much, much higher. We now can service retail partners in a way not imaginable before the acquisition.”
“Full-line retailers are also looking for other streams of revenue, so they are looking at how they can supplement what they already do and sell more to existing customers walking through their doors,” Stewart continues. “Do they attract a new customer because they offer a new category? These are real business questions that store owners have to ask themselves. How am I going to get over this hurdle, other than just hoping and praying that interest rates suddenly drop, housing takes off and everyone starts buying furniture again?”
Over the past three years, the company hit some bumps — like a difficult integration of an enterprise resource planning system. But that has changed and now the company has better data and planning capabilities as well as massive distribution on the East Coast. “We have stabilized our operations in a way that we can build and move forward,” Stewart says.
The difficulty of the integration of Sunset West was further compounded by the learning curve of teaching a new sales rep force a brand-new category.
In working with the reps, outdoor furniture is a different animal than indoor furniture. He recounts a story about one of Hooker’s biggest reps seeing a slightly bent leg on a sofa and thinking it should be trashed. This makes sense — wood is either broken or it’s not. It’s different with outdoor, and you can tap something like that back into place with a rubber mallet.
“We had to teach the reps how to work through the issues that all outdoor retailers have, and education has taken a long time,” Stewart says. “Now the indoor reps are really starting to understand the category, which is a huge feat for people who are used to selling leather or wooden case goods.”
The seasonality of outdoor furniture was also a tricky obstacle the companies had to overcome. Trying to release new outdoor collections every six months on the same scale as Hooker’s introductions is not productive, according to Stewart. “There’s a cadence to the outdoor industry that they soon realized,” he adds.
With Hooker being a public company, he says Sunset West had to change the way it did business considerably.
“We had to hire for roles that we’d never had before,” he explains. “And most of it had to do with compliance, which was a huge learning experience for us. We had to learn each other’s language. There’s a process to getting things done versus the agility I enjoyed previously. But the benefit of having a large partner is that you can scale your business much faster.”
The acquisition put Sunset West in a unique position in the outdoor industry where they can leverage two bi-coastal warehouses and offer competitive prices on higher-quality furniture. Not many in the outdoor industry can boast that.
“We’re in the spot where this industry has flourished due to the accessibility of attractive outdoor furnishings,” Stewart says. “And now we have a category that’s got teeth because people have built their homes around outdoor living. It’s a category that has accelerated over the last 20 years into a regular, year-round sale versus being much more of a seasonal sale. We are emblematic of that maturing because we grew up in the category and watched it build around us. With Hooker’s resources, we are now ready for a solid 2025.”
