Larry, I think most makers fail for the same reason many retailers fail. Furniture is a labor and materials intensive business, so there is really not any secret to doing it, and many do it well. There has to be a margin earned, coupled with a certain volume tied to that margin to remain in business. If either slips dramatically, the maker (or store) cannot survive.
Moving to China for production was an effort to reduce costs, thereby preserving margin in a highly competitive field. But there were a whole lot of makers that moved to China all at once so what happened was prices (and margins) were reduced through competition and there was no benefit to the makers profit-wise, but consumers paid less for the goods. One of the things that many didn't plan on was poor quality control and damaged goods (damages are rather high in my opinion, as they come from China to the store without every being touched).
You're going to continue to see makers and stores go under. Why? Because they either need 2x the volume or 10 % more margin than they now have to be healthy, and its not happening. You can trade volume for margin, or margin for volume, but you can't hang on with both in decline. Eventually, only a few will be left standing and you won't see new players coming into the marketplace. I had someone call me for advice on opening a furniture store a few months ago. Know what I told him? "Don't even consider it. You will fail and lose your start-up cash, I can almost guarantee it. If you want your own business, look elsewhere, but not in home furnishings!"
Duane Collie
Straight answers from thirty-six years in the business.
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