What does the furniture retailer think about the relative merits of U.S., Canadian and Chinese manufacturers? A study titled  "How do retailers rate the U.S. and Canada as furniture sources compared to China"  provides a few interesting answers to this question.

The study was intended to identify those areas that U.S. and Canadian furniture manufacturers did well compared to Chinese producers. The paper was written by Urs Buehlmann of Virginia Tech, Matthew Baumgardner of USDA Forest Service, Torsten Lihra of Forintek Canada Corp. and Mary Frye of the Home Furnishings International Association.

Retailers were asked about the importance of 16 product and service attributes and then were asked which country of origin, Canada, China and the United States, possessed each characteristic. Overall, the U.S. was viewed most favorably as a furniture source (scoring 242.1, based on rank of attribute and possession by that country), followed by Canada (207.9) and China (156.3).

U.S. scores well in flexibility, returns

U.S. manufacturers possessed the highest level of every attribute except low price. The U.S. did particularly well in categories of "flexibility in order quantities," "easy to return damaged or defective goods," "broad range of style options," "strength of brand names," and "replacement parts readily available."

So why are U.S. and Canadian companies losing market share? If the home country survey bias is removed and attributes are ranked within each country, one can see that the areas that the U.S. is doing well in are not perceived to be important attributes.

Two problem areas for U.S. manufacturers were perceived to be "on-time delivery of orders" and "easy to return damaged or defective goods." (None of the sources performed well here.)

Canada's strongest attributes were "consistency of product quality," "quality of finishing," and "accuracy of delivery." Canadian manufacturers were seen as being strong in offering "broad range of style options," and "broad range of finishing options."

And what about China? "Low price" was the main advantage for Chinese manufacturers. Even so, "low delivered wholesale price of product" was not perceived to be an important attribute. Other important attributes for China were seen as being in "quality of finishing," "consistency of product quality" and "accuracy of delivery."

One other note: retailers that source from China view low price as more important than retailers that do not source from China. Not surprisingly, retailers sourcing from China have better perceptions of Chinese-made products in terms of consistency in product quality, available style options and finishing quality.

The study suggests that U.S. and Canadian manufacturers increase their focus in competitive advantages they possess, such as "replacement part availability" and "flexibility in order quantities." Importers have difficulty in filling smaller orders or providing after-sale service.