Selling Design Solutions Instead of Commodity Materials

They say necessity is the mother of invention. Opportunity, then, must be its godfather.

And to paraphrase The Godfather himself (as portrayed by Marlon Brando), the furniture industry has been made an offer it shouldn’t ignore.

Material Intelligence organized a workshop during the Pan American Laminates Conference held in Toronto in early December. Created and managed by Kurt Fischer of Technical Conference Management (www.tcman.at), based in Vienna, Austria, both the Pan American and European Laminates Conference Programs have focused primarily on technical and production issues, new processing technology, etc. Design has slowly been creeping into these events, championed largely by yours truly. (In 2010, these events will be held in Stockholm, Sweden, 23-26 March, and Montreal, Canada, 27-29 September.)

The intent of the technical content is, of course, to help producers of decorative surfaces, panels, and furniture components improve efficiencies and increase their profits. And while these discussions are very important, they’re only one side of the coin. Better understanding the end market and the opportunities for expanding it is, to me, a much shinier side of that same coin.

For example, for a TFM producer upgrading processing equipment and streamlining the use of raw materials may net a savings of one to four percent. At high volumes, this is nothing to sneeze at, and will fatten – albeit ever so slightly – the bottom line.

Better understanding what the design community needs and wants, on the other hand, can net an additional 20 to 100 percent, perhaps even more. Straight to the bottom line. And every step of the value chain, particularly the furniture fabricators, shares in this windfall.

This kind of thinking, unfortunately, is a leap for our industry, because it requires selling our products on value, rather than on price. Establishing “value” means assessing and communicating what it delivers in terms of durability, beauty, ease of handling and installation, and environmental friendliness – which includes comparing our surface against whatever material or materials it replaces.

Our advantages have an inherent value, particularly to design specifiers, far beyond a “cost plus profit margin” formula. Unfortunately, for decades the sales story for laminates has been, “Well, it’s cheaper than veneer.” The current state of the industry is proof enough that we are paying the price for this short-sightedness.

Material Intelligence is working intensely with decorative surface suppliers in 2010  to develop a value-focused sales story. For starters, we must embrace a new way of thinking about our products, to wit: “We don’t sell materials, we sell design solutions. Materials can be commoditized; design solutions cannot.”

Which takes us back to Toronto. I used to think our value-oriented opportunities meant bringing better print designs, and especially better textures, to existing applications – furniture and interior surfaces that we already supply. But a presentation by Jaime Velez, principal of interiors for Skidmore, Owings and Merrill (one of the largest architectural firms in the world) showed us many examples of additional applications that are crying out for fresh solutions: Textured interior walls, made from plaster, that are impossible to clean and too easily damaged; ceiling tiles with more visual interest; high-gloss surfaces more durable than lacquer; and even office workstation divider panels with more visual interest, that don’t get as dingy or dated as fabric.

Velez knows laminates – he has worked closely with Formica for years, and even designed the interior of their new corporate headquarters in Cincinnati, Ohio. (One of his more recent projects, by the way, is the Burj Dubai – the tallest building on Earth.)  He knows that each of these applications could easily be handled by engineered decorative panels, made with technology and materials we’re already using, with significant cost savings over what he’s currently specifying.

So here’s a world-famous architect, essentially making us an offer  – if we use our current methods and resources to create more surfaces he can use, he will buy them. Will we take him up on it?

Focusing on our Ultimate Customers

(April 8, 2009)

I’m less than 24 hours home from this year’s European Decor Surfaces Conference & Workshop in Barcelona, and despite the jet lag I feel pretty good.

One of the things I feel good about is the name of the conference itself. It was the “European Laminates Conference,” founded originally to focus on paper-based decorative surfaces, like HPL, TFM and printed paper foils. This year the presentations included 3-D laminates, ending a segregation that I always found unnecessary.

The reasons for this were obvious enough. Over the years most of these conferences were driven by suppliers; in the case of the decorative laminates world, the decorative and base paper suppliers were the sponsors and benefactors of these conferences. Because of the nature of these companies, and the fact that the laminates divisions were often a tiny part of these large global concerns, the presentations tended to focus on highly technical subjects and on commodity market issues.

The emphasis was always on increasing manufacturing efficiencies and addressing the needs and concerns of the immediate customer – the saturator, the printer, the laminates producer, etc. This “supply-side” bias created a downstream disconnect in the value chain that literally became a dead end – one, two or even three steps shy of the industry’s ultimate users, the consumer and the design specifier.

I began attending many of these conferences as early as 1995, and I couldn’t help but note that they were a bit more academic than “real world.” As a journalist my experience was mainly in interviewing designers and architects, who aren’t shy about telling you what they like and don’t like about materials, and what kinds of solutions they are still seeking for their projects. As a result I’ve become fairly familiar with how they think, how they go about specifying materials from other industries, and most importantly, how they like to receive information on materials that are new to them.

The disturbing bottom line is, as upstream suppliers are killing themselves to shave 2% off of production costs, designers are willing to pay significantly higher prices for a product that’s engineered to their needs and tastes.

Put even more simply: while millions of dollars are going into research and technology to help companies to increase profits my a miniscule amount,  a simple understanding of the design market could lead to margin factors of two or three times what they are now.

This works for other product categories; why not ours?

It’s because we haven’t bothered, as an industry, to develop our “product story” to this level of buyer. But I think I’m seeing light at the end of this tunnel. Efforts like the Surfaces and Design section here in Panels and Furniture Asia, Material Innovations in Interiors & Sources, and Surfacing Solutions in Wood Digest, (all content supplied by Material Intelligence (.com)), are forcing suppliers to look all the way downstream, which gives them a fresh perspective when they turn their heads back up the supply chain.

This connection needs to become a busy two-way street, sharing ideas for where to use our existing products with those specifiers, and ideas for where our products should and could be used filtering up toward those producers who wouldn’t otherwise make that connection.

This is not only the way for our industry to survive the current crisis, it’s a golden opportunity to gain market share against other materials as specifers search for better value, performance and design consistency. We can no longer congratulate ourselves for minor increases in efficiency while we ignore major opportunities in more effectively reaching the ultimate users of our products.

Working together throughout the entire value chain to tell that story is an excellent first step.

Who Decides on Materials…Architects, or Designers?

A few weeks ago I set out to do have as many conversations as humanly possible with design specifiers, to gauge what they know about laminates, and how the final material decisions are actually made.

The results have been both disturbing and enlightening, but all point to the same issue – the laminates industry still has plenty of work to do.

What I’m finding out is, in general the architect sets the larger design themes, and relies on interior designers to work with the clients and choose materials that meet budget and aesthetic demands.

From a resource librarian at a $300 million commercial architectural firm: “The designer determines the final spec. Everything would be reviewed by the project architect, but they trust the interior designers’ expertise.”

An interior designer for a custom builder says: “The architect makes the initial spec, and when I take that to the client their eyes pop out at the costs. It’s my job then to find materials that the client can afford, and still get the look they want.”

Suppliers of high-value interior materials, take note!

Also please take note of an excellent blog on 3-D laminates: http://thermoformingtimes.blogspot.com/

TFM and 3DL suppliers – Missing the Healthcare Casework Market?

I just got off the phone with the resource librarian for a $100 million architecture firm that specializes in high-tech hospitals and clinics about how they use engineered furniture surfaces. Highlights: TFM is for cabinet interiors, and she’d never heard of 3-D laminates.

“We use HPL on the cabinetry we spec because we’re 100% healthcare. Healthcare is such a high-abuse environment, with shared offices being used 18 to 24 hours a day, we don’t want to risk having our casework fail prematurely. There may be some value engineering happening in back-of-house applications with melamine panels, but we leave that up to our fabricators.

“Mostly, we use melamine for cabinet interiors.”

Where is this firm getting its information on TFM?

“We’ve never had a TFM supplier call on us. Actually, the only supplier who has ever talked to us about that material is a decor paper printer, who has been coming in a couple of times a year for several years now. We’re happy to weigh in on trends, design, and color, we aren’t in a position to directly buy decor paper.”

I asked her if her firm has ever used 3-D laminates.

“What’s that?” she responded.

Vinyls, RTF, for sealing five of the six surfaces of a panel, creating soft edges, unusual shapes…great for the medical industries. I told her about my recent feature on Midmark Corp., who have been successfully using 3-D laminates and TFM panels on medical casework for over a decade.

“I’ve never heard of 3-D laminates, and I’ve been running resource libraries for years. Can you send me something about that?”

And so I did.

Interior and material images now on Flickr.com!

Have a peek at my photos: http://flickr.com/photos/kennbusch.

You’ll find images from my feature stories, as well as shots from the International Furniture Fair in Cologne, 2009. And, of course, more!

Designers on Specifying Materials: Looking for that ‘Spark’

I just had a very enlightening and lengthy conversation with an interior designer working for a medium-size architectural firm in the Chicago market. They do a mix of commercial, retail and residential work, using a very wide mix of materials and finishes.

“When it comes to choosing materials for a current project, it often comes down to timing,” she told me. “We keep our library up to date and have plenty of material samples, but something we’ve seen recently in a magazine, or learned about during a visit with a rep, is more likely to be considered for the project. Something needs to happen to spark our memory.”

Regarding the attention paid to her firm by the laminates industry, the stats are grim. Only one smaller HPL company actually schedules meetings; only one of the major suppliers is proactive about updating samples, but never schedules “even a five-minute meeting with us.”

And what about TFM – thermally fused melamine panels? “We’ve never had a visit from a supplier. I’ve had to do my own research. There’s very little information available, even from our distributor.”

[In a related conversation, a design manager from a major TFM manufacturer recently told me: "When I visit architectural and interior design firms with our distributors, there's always a spike in sales of TFM to those customers. The problem is, I don't have the time to be on the road like that every week of the year. We need to find other ways of getting our story out, and keeping it out there."]

The interior designer also said some surprising things about materials substitutions. Often, it’s not just about cost.

“We sometimes have clients who ask for something that can’t be done, like a maple woodgrain with a dark stain. If you try and stain maple it ends up all blotchy and looks awful. What they’re actually asking us to do is find a look, not a specific material. If we can find a client like this the color and pattern they want in an engineered surface, with better durability and at a lower cost, they are delighted. This is what they pay us to do, after all.”

What are her criteria for specifying materials?

“Number one is cost, not surprisingly. We’re always facing budgetary concerns. It’s part of the process of value engineering – we use our knowledge of what materials are available and try to find the best combination of cost, look and performance.”

And what do designers mean when they say “we want ‘green’”?

“That depends on whether the project is going for a certain LEED rating. Not to many of ours fall into that category, so for us ‘green’ means mostly: How is the product manufactured? With how much recycled content? And where?

“Everyone thinks of bamboo as the dream green product, especially for flooring, but it has to be shipped so far that it’s actually less green than a product made here in North America.”

I heard exactly this take on bamboo’s “green washing” from another industry source a day later. Apparently the word’s out. I’ve found posts dating back five years questioning the true environmental friendliness of bamboo, but the accepted wisdom is still that it’s a wonder material.

I guess that shows the power of deciding on your message and relentlessly promoting to the A&D community.

It’s time for the laminate industry to take heed. Our green story is worth telling. Once we decide what it is, of course.

Let’s talk!

Kenn Busch

Material Observations at IMM: Vibrancy and Contrast on the Micro and Macro Scale

Walking the IMM (International Furniture Fair), in Cologne in January, you couldn’t help but notice an exuberance that belies what we’re hearing about the economy – a welcome contrast!

Bright, bold colors and high-character woodgrains – many mixed with whites or other solid colors – beckoned visitors, often causing them to stop in their tracks and cut across a crowded aisle of visitors to get a closer look. Or as in my case, some close-up photos so share: http://www.flickr.com/photos/kennbusch/

Gone were some of the staples of recent years – strong, straight-grain oaks, washed with grey or white, were nowhere to be found. It seems as though this approach to “design conservatism” is giving way to an obstinate optimism expressed quite often in orange, and even more so in purple.

The staid walnuts with muted neutral tones have warmed, and both light and dark woods sported bold, flowing cathedrals. In many cases, light and dark wood (sap and heart wood) tones were visible on the same panel, even in areas as small as a drawer front.

The economy, not surprisingly, is inspiring more of the “homing,” or “cocooning” trend – spending less money going out and more time in the home, condo or apartment. Add to this the ever increasing number of people running or starting home-based business, which is driving a blending of work and home interiors – not just in surface design, but also in the form and the (multi) functionality and scale of furniture.

Compact laminate (solid phenolic), a material whose potential has only just started to be explored, appeared in some unexpected places, including a dining table and thin living room shelves. 3-D laminates continue to improve in design fidelity and performance, with a high-gloss finish perfect for the European market; North America still prefers softer finishes.

White was still everywhere, although tempered a bit by other solid colors. I heard an interesting take on this trend from Peter Garlington, design manager for Interprint LLC. Working with solid white surfaces frees designers from the constraints imposed when you use traditional furniture finishes. A new design concept executed in a traditional woodgrain, for instance, looks odd or out of place because “wood isn’t supposed to do that.”

Garlington says a new generation of designers (and consumers) are waiting for the surfacing suppliers to break with the past and introduce concepts that are entirely unto themselves – abstracts, even electronic and “reactive” laminates may be in our not-so-distant future.

When this leap is taken, you can be sure you’ll find it in Cologne. For more information on IMM, please visit: www.imm-cologne.com

Pop-off panels!

Hip Vanity

. For more images and thoughts on IMM 2009, please visit www.materialintelligence.com.