How can to-the-trade showrooms survive? | Blog

Author Ken Ludwig is the co-owner of Kenneth Ludwig Chicago.

 As a 33-year veteran of the home furnishings industry, this is a question that I ask myself every day. With more daily competition from designer buying groups, traveling to-the-trade designer shows, and manufacturers selling direct, it’s a wonder we can still get a piece of the pie.  We are committed to opening orders of $2,500; pledge $5,000 to $15,000 to get a line; and maintain anywhere between $25,000 and $100,000 to keep our dealership.

Sadly, vendors are not holding designers to these requirements.

At the recent ARTS conference in San Diego, this topic of selling to designers was top of mind. A panel discussion among retail stores, trade showrooms, manufacturers, outside sales representatives and market promoters netted interesting conversations. The clear message from vendors was that they plan to continue selling to designers.

But stocking dealers must be supported, and our partnerships with vendors honored to continue to market and sell to our designer customers. We constantly struggle to stock our showroom floors and meet vendor requirements to be deemed a trade showroom.

Most of the parties in San Diego agreed that those procedures should be maintained, and that designers should be sold at fair mark-up over stocking dealers. But there were also a growing number who said they were selling to designers and stocking dealers at the same price, with the philosophy of “whoever gets the order wins.”  That is a sad and, quite frankly, scary prospect.

Many trade showrooms feel we are in direct competition with a great number of our vendors.  We know that a number of them are overstocked, pressured by hedge fund owners, or have poor sales-dealership structures. We hope that vendors who are interested in partnering with trade showrooms and retail stores that sell to designers listen to our needs about margins, give credit for maintaining trade accounts, and offer perks to us exclusively as a leading source of sales for the company.  Seventy-five percent of our lines maintain this philosophy. It’s the 25% we must babysit.

For those designers who think “buying direct” is the better option, we’ll see how they handle poor customer service, freight claims, no marketing support and continued pressure to “buy more” from those vendors.

Our hope is that educated designers will treasure and appreciate our concierge customer service and continue to support our trade showroom business long into the future.

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