When I began my current business in 2003 by buying Berberian Oriental Rugs, in Charleston SC, I wanted to modernize and update the company. I very quickly saw that the evolving assortment of modern and custom rugs and realized the name no longer fit. To grow the business we found ourselves dealing with an entirely new customer—one that wanted to make the decorating statement at home with traditional ‘Oriental’ rugs, while also demanding updated colors and more stylish designs.
It was actually my wife who solved the enigma of describing what we were becoming. She observed that my customers were buying fine rugs, like they have ‘fine’ china, appreciated ‘fine’ art and went for out for ‘fine’ dining. So we changed the name to Fine Rugs of Charleston, a name that has positioned us to broaden the retail experience and to employ the marketing tactics that have helped us be successful.
Adjusting the assortment was necessary to attract and satisfy these new customers, but it was tricky. We could not do it too abruptly and risk devaluing our current inventory. We re-bought only our best sellers and moved to new, updated styling cautiously, but decidedly. We felt it wise to preserve our price points because dropping them would expose us to a whole range of new competitors, including the internet. We avoided the trap that has ensnared many rug retailers and did not become part of the “70% off” crowd. We kept our competitive edge by maintaining a fresh selection and marketing our reputation for service and knowledge.
In my last post, I shared two trends that are killing the rug industry. But even in the face of the declining supply of hand knotted rugs and growing competition from the internet, these strategies can be very powerful. They are:
1. Target your local Interior Designers by making your store a showroom. Your primary client target is the same as theirs. Find and visit them and structure a discount arrangement that will be attractive.
2. Hold events in your showroom. Get out and get involved by holding contests, sponsoring causes, sports teams, etc. Partner with local ASID and IIDA chapters to hold continuing education classes for them.
3. Advertise differently. Focus on yourself and on your staff. Promote your knowledge and dedication to service. Use public relations tools to get coverage of your non rug selling activities.
4. Stay classy. Evolve your selection and always endeavor to make it look fresh. Commit to selling custom rugs, and don’t rely on brands. Most long time rug sellers do not feature brands, as the retailer’s image in the community represents the assurance of quality and service. Stand on your store’s reputation.
5. Get into broadloom carpet. The range of offerings now being produced by the designer oriented carpet importers is truly astounding. Cash flow in carpet has always been better than rugs and improved selections make it a requirement for a designer showroom.
These are the primary tactics that we have used in the 10 years since we have operated Fine Rugs of Charleston. Over 85% of our sales now go to or through an Interior Designer. We have become a crucial part of the design community here and a “go to” source for the local home furnishing design press. Currently over half of our rug business is done in contemporary designs. Almost all of the tufted rugs we sell are custom and we have only one “Wilton” in our rug selection.
We did move aggressively into broadloom in late 2008 and, from nearly no sales that year, by 2012 40% of our sales were carpet, most of which was high end patterned wool broadlooms that were cut into room size rugs. Another 5% was carpet sold and installed on stairways; which we like to call the forgotten room.
I cannot overstate the difficulties we had over 2008-2011; four consecutive 15% down years. That’s a better than 48% decline from our 2007 sales. While not quite back to that peak volume, we were profitable again in 2012. 2013 has begun very well and if our three month trend holds up, we will grow back to the 2007 level in just two years’ time. It has been very exhilarating and while I am not ready to declare victory, I think that Fine Rugs of Charleston now has the staying power necessary to contend with the external forces and the changing times.