Design Decor: Growing despite tough economy
Cinde Ingram -- Casual Living, March 1, 2009
By the time the casual lifestyle trend swept the nation and brought more demand for indoor/outdoor furnishings, Design Decor had adapted its international scope to suit the U.S. specialty retail market and was positioned for growth it now sees.
“We're the new kids on the block and growing up fast, we like to say,” Design Decor President Steve Tsai said. “Our reputation is helping us to grow fast because we can deliver what we say, we listen to our customers and we have good products. Every company is facing some kind of problem one way or another. We are facing a good problem.”
Tsai attributes the growth to changes in its product mix and its sales force. Tsai's wife Rebecca, operations manager and accounts receivable, and his brother William, customer service and sales manager, prepared for and are managing the sales growth they are witnessing now despite the economic downturn.
The Alpharetta, Ga.-based company plans to move into a 30,000-sq.-ft. Atlanta warehouse by May and a West Coast distribution center is in the planning stage.
“We've always had a reputation of shipping fast,” Tsai said. “That's really put us in a good position. We're comfortable serving specialty retailers and believe our product suits this group of retailers best. That's our solid foundation.”
Although its parent company's three Chinese factories had supplied customers in Asia, Europe, Australia and the Middle East, it launched Design Decor in 2003 to take on the opportunities of supplying the U.S. market. The process of understanding American consumer tastes and melding them into its factories' capabilities took time. For example, instead of supplying products they know fit the European market's preference for scale and back pitch, the company took time to listen to what American customers wanted.
“It was a learning curve,” Tsai said. “This past year, we made quite a stride. Our products came together in the past six months. We had tremendous markets in July and September. As a result of that, the company is doing great in this economic cycle.”
Design Decor attended its first Casual Market in Chicago in 2004, about the same time mosaic tabletops were getting plenty of attention.
“The trend was going indoor/out in style so we were taking some of our indoor furniture and accessories designs and making them outdoor products,” Tsai said. “Our tabletops had such great quality, we were able to persuade dealers who were shy of the product or who had been hurt by other factories before. We had been doing mosaic tabletops for 14 years so we had weeded out all the glitches or problems.
“Some of our dealers have told us our tabletops cause the least trouble of any other tabletop they carry,” he added. “That reputation is quite important.”
Through listening to retail dealers' requests, Design Decor made adjustments to its price points and product mix. Mosaic tabletops initially accounted for about 80% of Design Decor's business, with accessories and other furniture adding about 10% each. Those smaller categories doubled to about 20% each in 2008 as the economy faltered. The company now takes a three-pronged approach with its mosaic tables, furniture and accessories.
“Our accessory tables are doing well” Tsai said. “Because of the price points we were hitting, we were able to supply dealers with very competitive price point products.”
Popularity of Design Decor's three-tired nesting tables led the company to introduce a two-tiered version this year “that has really taken off,” William Tsai said.
Tsai agreed with his brother's assessment, and credited dealers who had advised them to add more accessories. “We took their advice and that's why accessories are taking off for us,” he said. “We communicate with our dealers. I always say they are our eyes and ears to customers so we can come out with a product that fits the market.”
The Tsais work closely with design teams in China, where the company's factories are located in Tianjin and Shanghai.
At the September Casual Market, Design Decor displayed 58 mosaic tabletop designs. Because dining sets have been selling well for Design Decor, a line with aluminum pedestal bases was added to the 2009 line along with a series of wrought iron furniture.
“We have to stay ahead of the game in mosaic tabletops because dealers and even competitors are looking at Design Decor as a leader in terms of design,” Tsai said. “Every company is facing challenges and ours is growth. We're still a young company and we're poised to grow the right way. We appreciate those dealers who are working with us and patiently waiting for us to grow. We think they will be rewarded with the right product, shipped on time.”