Zeeland, MI—MillerKnoll, the July 2021 combination of Herman Miller and Knoll—two of the biggest commercial furniture firms—seems to be working based on the latest quarterly earnings report, with orders of $1.1 billion, an increase of 93.6 percent over the prior year when the two firms were separate.
Revenue reach $1 billion, up 74 percent. MillerKnoll CFO Jeffrey Stutz says labor shortages and supply chain issues constrained better performance for the firm. “We estimate these disruptions adversely impacted net sales by approximately $34 million in the quarter,” says Stutz.
One sales driver is Herman Miller’s established retail operations, which accounted for $635 million in revenue for the first three quarters of the fiscal year, says Andrea Owen, CEO. During a March 29 call with investment analysts, Owen noted that Knoll branded furnishings and its Muuto line have been channeled into Herman Miller’s existing brick-and-mortar stores—it is also adding more Herman Miller outlets and also owns Design Within Reach—as well as e-commerce channels. The go-to-market strategy is known as omnichannel marketing, which the contract furnishings industry has been adopting. Traditional dealer-reliant sales methods were disrupted by the pandemic, with millions of work-at-home employees purchasing their own office furnishings.
In March, the company held its first national sales meeting for the combined teams, and in June it will roll out rebranding under the MillerKnoll name. Owen also remarked on the invasion of Ukraine by Russia.
“Our foundation made an immediate donation and support of humanitarian relief efforts and is matching donations from employees, dealers and our suppliers,” Owen says. “It’s been inspiring to see our MillerKnoll community come together in response. And while this region makes up a small part of our international contract segment, it will remain a top priority in terms of both business risk mitigation and humanitarian support.” Last year year the company did $10 million in revenue in the area, with two dealers in each country involved: Belarus, Russia, and Ukraine.
Now workers are leaving home offices and resuming the commute to work. “Contract clients are activating their long-awaited return to office plans,” Owen says. “As employers consider their spaces, we are seeing a push toward investing in the workplace to create premium spaces and differentiated employee experiences.”
The premium preference trend carried over to retail as well. “Our Retail business continued to grow as consumers invested in their home experiences with Design Within Reach, HAY, Muuto, and Herman Miller. In addition, Holly Hunt [a luxury residential brand] and Knoll drove strong residential sales,” Owen says.
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