La-Z-Boy inks manufacturing deal with major Austrian furniture producer

STYRIA, Austria – Top 100 furniture retailer and manufacturer La-Z-Boy has signed a licensing and manufacturing deal with ADA, one of the largest upholstered furniture manufacturers in Europe.

ADA will serve as the exclusive manufacturer for the La-Z-Boy brand in Germany, Austria, Switzerland, Croatia and Serbia. Established in 1957, the company operates five locations across Austria, Hungary and Romania, carrying out 98% of its furniture production in-house.

Per the deal, ADA will initially produce six La-Z-Boy recliners that “offer a variety of features.” These designs will be shown at the La-Z-Boy showroom in ADA’s Austrian headquarters.

“The licensing partnership with ADA is a significant step for us to strengthen our brand presence in key European markets,” said Mark Draper, vice president of La-Z-Boy’s international business. “We are very much looking forward to working together to develop appropriate designs specifically for these markets. This allows us to offer even more end customers the convenience of La-Z-Boy furniture. A number of marketing campaigns will follow in the next few months to publicize our market entry.”

“Our many years of experience as a manufacturer for license partners is a big plus point for the cooperation,” said Margot Wisiak, chief marketing officer for ADA. “We are confident that through this partnership we will make the most of our shared strengths to open up new markets and advance La-Z-Boy.”

La-Z-Boy hasn’t yet released its third quarter earnings but should do so later this month. For the second quarter, which ended Oct. 28, sales totaled $511 million, a decrease of 16% from last year. An ongoing focus for the company is its “Long Live the Lazy” brand campaign, which embraces comfort and relaxation.

“We are excited about the potential of our new brand campaign, ‘Long Live the Lazy,’ which was introduced in August,” said CEO Melinda D. Whittington in the second quarter earnings report. “In the quarter, we activated our new marketing strategy, leveraging data based consumer insights and our brand heritage of comfort and quality to connect with a broader consumer base. Despite weakness in near-term industry traffic trends, we continue to take a long-term approach to investing in our business and are making steady progress toward building a more agile supply chain and optimizing our network.

“Although consumer traffic trends remain a headwind, La-Z-Boy remains well positioned to continue outperforming the industry due to our iconic brand, consumer preferred shopping experience, and long-term approach to investing in our business, enabled by the strength of our balance sheet. We are confident in our ability to grow at a pace double the industry and deliver double-digit operating margins over the long term.”

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