An Industry in Decline

Reputation Under Attack

The steady growth of the semi-annual furniture buyers markets over the first decades of the twentieth century solidified the Grand Rapids brand as a leader within the furniture industry.. However, the industry began to decline in the late 1920s and crashed with the stock market. Though the industry revived itself after World War II, it had permanently changed. The old Furniture City was no longer a driving force.

A line graph showing an overall increase in market attendance until the mid-1920s. There is a small but steady decline and a sharp decrease in the late 1920s. the 1930s and early 1940s are much lower than the rest of the graph. There is a sharp increase after the end of WWII and another sharp decline around the mid-1950s.

For more information about the line graphs please see the Methodology section.

As the furniture industry slowed, Grand Rapids’s reputation came under attack. The Federal Trade Commission filed complaints against the manufacturers for misleading customers about the quality of their products in 1926. The case turned on whether or not companies mislead dealers and consumers by not labeling their furniture “veneered mahogany” instead of “mahogany.” The Federal Trade Commission drew on the common sense notion that “Mahogany means Mahogany and that Walnut means Walnut, until it is proven to mean something else.” They also argued that adding a thin veneer, only one or two twenty-eights of an inch, should not permit the manufacturers to use only the name of the more expensive wood as the vast majority of the furniture was a different type.

In describing the potential for fraud, the Federal Trade Commission underscored the way in which the Grand Rapids furniture manufacturers acted as a big city bully. They described an industry in which manufacturers mislabelled their goods, dealers used the manufacturer’s description, and consumers bought “mahogany” or “walnut” that was primarily constructed of other woods. In large cities, retail stores like Marshall Fields and Macy’s displayed “mahogany” and “walnut” furniture from these manufacturers next to honest companies that produced solid wood products or labeled their furniture “veneered mahogany” and “veneered walnut,” a fact that would undoubtedly steer at least some consumers to fraudulently described furniture sets.

While metropolitan consumers may be misled on the showroom floor, the most egregious instances of fraud were the way in which the “sinister” Grand Rapids companies fleeced consumers in small towns. Because smaller towns had less demand, retailers in these cities had to custom order high-end furniture from Grand Rapids. As small scale operations, these dealers would not send buyers to the markets in Grand Rapids or even attract travelling company representatives, forcing them to rely solely on advertisements and catalogues. Towns like the five-thousand-person Hudson Falls, did not understand the misleading nature of manufacturers’ vocabulary and were “unfamiliar with the ‘Fables’ of Grand Rapids.” Instead of distancing themselves from the means of production, the Furniture Manufacturers Association focused on disproving the Federal Trade Commission’s accusations of deception. The Furniture Manufacturers Association, a leading Grand Rapids industry group, freely admitted the use of veneers as this method of construction was consistent with “the cabinetmaker’s art.”

On September 25, 1928, the Federal Trade Commission won cease and desist orders against the Grand Rapids manufacturers forcing them to include the term “veneered” in their descriptions of their products. They used this legal justification to launch new action against other companies using similar terms incorrectly, including 12 cases involving companies from Rockford, IL. However, the Furniture Manufacturers Association appeal the decision to the 6th Circuit’s Federal Court of Appeals and on June 28, 1930, the Court of Appeals ruled for the Furniture Manufacturers Association, agreeing that there was no evidence the manufacturers ever made misleading claims as to being “solid” or “genuine” or that they should expect their products to be sold as such. The Federal Trade Commission accepted the ruling, decided not to appeal to the Supreme Court and dismissed the Rockford cases.

Retraction

By 1930, however, debates about construction were the least of the furniture industry’s problems. The stock market’s crash shook the industry, though it tried to remain positive at first. A Grand Rapids-based trade journal, the Furniture Manufacturer ran many articles initially upbeat about the future of 1930, saying “Manufacturers look forward with confidence to the markets this month.” They quoted Martin L. Straus, the president of a Chicago furniture company who believed it would “be a good year” for his company. Another Chicago executive expected 1930 to be just as good as the year before. E. L. Rogers, the general manager of “the world’s largest exclusive home furnishings store” in Los Angeles, posited that the “recent stock market upheaval” would spur sales because it opened up “capital heretofore utilized in stock trading.” The managing director of the National Association of Furniture Manufacturers, A. P. Haacke, made similar comments that “most of the stock losses were paper losses, and only a small percentage of the buying public actually lost money.” Haacke advised for “ordinary common sense,” suggesting the panic was the work of a small group and that sales would actually be up in 1930 due to pent up demand from a decline in sales over the previous couple of years. An article proposed that the industry always underwent seasonal shifts in buying and that this was merely a downturn that would be corrected shortly. Another company president writing into the magazine echoed this sentiment, suggesting that the “slump” is merely “psychological.”

At its worst, the furniture industry saw the downturn as an opportunity to clear out some of the weaker companies, believing the strongest companies would emerge intact. Following this logic, leaders stressed the importance of fashion and design as the distinguishing factors that would allow companies to ride out the downturn. Rogers maintained that “the element of fashion will be brought into prominence more strongly than ever” and Straus believed that design would “be a bigger factor than ever in 1930.” The editors of the Furniture Manufacturer firmly praised the construction of high-end goods, suggesting that consumers’ move to cheaper products was just temporary and that “Quality will pay in the long run.”

By April 1930, this optimism faded. Only months after the initial optimism, the furniture industry now realized that the stock market crash would prevent any market resurgence. Instead, furniture producers found themselves “in a period in which the unwritten law of survival of the fittest will undoubtedly be brutally applied.” The Furniture Manufacturer now warned against “singing the blues.” While they did not advocate blind optimism, they did “try to refrain from wearing a long face.” Recognizing the economic downturn as significant, leaders reflected upon the systemic problems. They warned against the “orgy of special prices and discounts” spreading because manufacturers had overproduced throughout the second half of the 1920s. They also lamented their inability to understand consumers’ thinking. This focus on psychology reemphasized the need for good fashion, but with much less confidence. They bemoaned that the furniture industry faced competition from antique models as well as new products. They worried over the future of the home as people rapidly downsized and “the whole art of living” changed. With only a veneer of optimism, they reassured themselves that the home and the need to furnish it would still exist in some form. An industry on the decline by most every metric, had now hit rock bottom.

A line graph beginning in 1923 showing a quick decline in the value of shipments per factory employee from 1926-1929 A line graph showing a steady decline in company earnings per factory employee from 1923 to 1929 A line graph showing a steady decline in company profits per $100 of Sales from 1923-1929

By virtually every metric, the furniture industry declined throughout the late 1920s. Although many manufacturers had been confident sales would rebound quickly, the onset of the Great Depression ended their optimisim.

Attendance at the Grand Rapids buyers markets mirrored this industry-wide decline. The furniture markets drew a healthy amount of buyers from many states across the country during much of the 1920s. Concentrated in the Upper Midwest and Mid-Atlantic regions, its distribution peaked in 1924, when a dozen states sent over 100 buyers. Beginning in 1929, however, a steady decline occurred and by 1933, only 4 states sent 100 or more buyers. The markets that made Grand Rapids the Furniture City turned from national events to regional affairs as the industry struggled to survive. Observe the decline and retraction towards Michigan in the dynamic visualization.

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View the Enlarged Graphic of the Grand Rapids Furniture Markets or explore the maps individually and learn more about this visualization in the Methodology section.

A Generational Shift

Though the Great Depression shook the furniture industry, the need to furnish the home never disappeared. Even the Grand Rapids buyers markets rebounded after World War II, breaking attendance records during the 1940s and 1950s. However, technological and industry changes made the travel of company representatives and transportation of goods easier. Grand Rapids’s position as the center of the furniture industry weakened as these changes rendered place an insignificant factor in the industry.

As the timeline of Furniture Manufacturers Association memberships below reveals, the companies that had built Furniture City were not necessarily the ones enjoying the postwar resurgence. Perhaps most symbolic of this change, was Furniture City's original flagship company, Berkey & Gay. Chicago’s Simmons Company bought Berkey & Gay in 1929 and closed its factories in 1930. A protracted lawsuit followed and efforts to revive the company lead to a 1935 reopening, though it closed for good a few years later. The furniture industry survived the Great Depression, but it was lead by a new generation. The national-prominence Grand Rapids constructed throughout the Gilded Age and Progressive Era declined quickly.

Of the 91 companies that initially joined the Furniture Manufacturers Association before 1930, 71 ended their memberships in 1950 or earlier. During the 1930s and 1940s only 56 new companies joined to replace the departed companies. The visualization displays this trend as much of the bottom half of the timeline is comprised of short lived companies. Likewise, the expected pattern of the graph, which would resemble a series of right triangles, holds much more for the companies before 1930 as there are large holes in the early 1930s and 1940s. Companies founded after the late 1940s seem to survive decades later better than others, further suggesting the furniture companies enjoying the postwar resurgence were new companies.

A timeline of Furniture Manufacturers Association members showing a number of companies leaving the group before the 1930s and a lack of companies joining in the 1930s and early 1940s. Companies joined in the 1950s and 1960s were still part of the organization at the end of the graphic.

For more information about this visualization please see the Methodology section.