Kurgo: Creating a Retail Category
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In 1994, Chris and Walter Chapin started Company C in—and this is not a cliché—their garage in Concord, New Hampshire. In less than two decades, the company has become a premier design studio and leading producer of distinctive rugs, bedding, furniture, decorative accessories, and fabrics.
Walter and Chris originally met in college, where they both were economics majors. "We shared a creative side that loves design" says Walter. Prior to starting Company C, Walter was in marketing and sales in the computer industry and, later, in real estate and finance. Chris had a short stint in banking, followed by a long career in textiles and decorative home accessories sales.
In starting the company, "we brought a shared love of entrepreneurship—of new ideas that can build a business—to the table," he adds. "And Chris is a natural product developer and designer with a vision for the development of product lines and mixing and matching bold and fun textures, colors, and patterns. As far as our philosophy goes, we believe that customers make decisions based on emotional responses to simple, original, and beautiful objects, and that color and design can have a deeply positive effect on people."
Giving customers what they want—without breaking the bank Company C started as a marketer of area rugs, and has expanded to pillows, bedding, fabrics and furniture, and works to help customers achieve their design goals as well. "Our niche is in helping our client create integrated whole-room designer looks, but with off-the-shelf products, and without design fees, long lead times, and a multitude of vendors," states Chris.
To that end, Company C works hard both in-store and online to help customers get what they want. For example, at their website, people can utilize the company's Live Chat function to help get answers to their design and related questions. In addition, the Company Room Planner is a simple CAD-style application that can help users design rug placement for any room in their house.
A studied approach to growth During the years, Company C has taken a very deliberate approach to growth, starting with its first retail store in its home town of Concord, New Hampshire in 2004, followed by stores in Portland, Maine (2006) and Hingham, Massachusetts (2007).
"We chose to live and base the company in New Hampshire because of the lifestyle," relates Chris. "The skiing, lakes, lack of traffic, and ease of raising a family—we have two boys, Ben, 15, and Alex, 19—appealed to us. From a business standpoint, the Concord location gives us access to talent North of Boston as well as easy access to the Manchester airport. Portland is a gateway to Maine, and a fabulous city with second homeowners and a local year-round population that appreciates art and design. Hingham captures part of the market south of Boston. Customers can also find us at some select Boston-area dealers, like Circle Furniture, Boston Interiors, Timeless Interiors, and the Reflective Designer."
Beyond its own brick-and-mortar operations, Company C has built very robust online and dealer channels. "We've been selling online for the past eight years and launched a new platform three years ago," says Walter. "Currently, online sales represent 10 percent of our overall revenues, but we expect that number to grow as consumers demand convenience and choice, and as they become more comfortable making larger purchases online."
To help develop its national dealer network, Company C has established trade showrooms in High Point, North Carolina, Las Vegas, and Atlanta. "We also have salespeople based in a wide range of territories who call on dealer accounts," Walter adds.
Getting the support it needs Company C's approach to customer satisfaction and growth has led to a strong and growing business with 750 dealers nationwide and 55 employees. Sales have grown nearly 20 percent between 2007 and 2011, and, says Walter, projections are for 10 percent growth in 2012. Going forward, he says, "we will add stores and dealers over time in the right locations, with the right people and a refined business model."
In a business like Company C's, staying on top of inventory needs is critical. To that end, the company maintains a $2 million line of credit with Salem Five. "Salem Five provides financing for inventory so we can constantly be in-stock to support our customers," says Walter. "They've been there when we've grown, and have provided the working capital we need to balance growth and seasonal fluctuations. As a partner, we appreciate how Salem Five takes time to understand our business, and listens to the challenges and opportunities we face so they can help us succeed."
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Help your business thrive with available funds from a Salem Five line of credit. You never know when you'll need immediate cash flow, and a Salem Five line of credit lets you write yourself a loan when you need capital, have equity concerns, or have a new business opportunity.
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