Birmingham Business Journal -- Dec. 18, 2007
Up and out are the only directions Bew White has known for several years.As president of outdoor furniture manufacturer Summer Classics, his business model for increasing revenue is to pay low rent on space and spend generously for advertising and showroom build-outs each year.
And that plan has paid off - with the company set to rake in $60 million in revenue this year, up from $20 million three years ago and within sight of its goal of $100 million in two years.
So how does a company that sells seasonal furniture not only stay afloat year-round but triple its revenue in a matter of a few years? Making and selling what the customer wants, not what your factory makes, White said. "You have to be willing to change constantly, willing to be flexible and see where the market is going," he said. And with its foot firmly planted in the outdoor furniture industry, Summer Classics is showing its flexibility. In addition to expanding its showroom space at the Chicago Merchandise Mart by 9,500 square feet, it also opened its first master store concept in October in Atlanta. The store is a mix of indoor and outdoor merchandise for the home, including art and antiques.
White said the master store goes by a similar business model, but includes paying higher rent in a more visible area so customers will be compelled to visit the store year-round. Grant Essex partnered with Summer Classics to open the first master store. Essex and his wife also own nearby Rocky Mountain Ski & Patio in Atlanta. The new 25,000-square-foot store is "meeting what I would have considered some pretty ambitious expectations to be opening at a counter cycle," said Essex, pleased with the results so far.
Backyards and gardens have become just as important as the inside of someone's home, said Essex, with people paying upwards of $50,000 to decorate outdoor entertainment areas. He knew Summer Classics' products were hot when he saw the brand emerge as the No. 1 product line over six years in his Rocky Mountain store. "We have been building the Summer Classics name in Atlanta," he said. "It's been 10-fold growth in the last six years because they have broadened what they have."
Summer Classics added Christmas merchandise to its retail roster this year, which both White and Essex said has done well, and plans to add a home collection in January. And with high-dollar promotional materials, Summer Classics is selling an image, said Jack Taylor, professor of retailing at Birmingham-Southern College. "When someone sees quality promotional materials on high-gloss paper with good color and beautiful pictures, that is an image thing and carries all the way through to the product," he said.
Taylor said Summer Classics' high-dollar advertising philosophy is purely textbook and successful, while many retailers fail to recognize the importance of advertising. "A lot of people base advertising on sales and that's backwards," he said. "It sounds like they are building consistent marketing communications and everything is tied together based on quality and image."
And as proof of the success of the company's image, White said Summer Classics' 45,000-square-foot Pelham showroom increased its volume this year by 56 percent. The showrooms can handle that volume, he said, since displays are changed constantly and space is added each year. "We change the look to make it an experience (for the customer)," he said. "We want them to come and spend a long time."
The company owns six of its 12 retail locations and products are sold through dealers across the country as well. Its cushion plant in nearby Montevallo, Alabama, the only manufacturing facility Summer Classics owns, experienced a 50 percent increase in production this year. A third of the company's 350 employees work in Montevallo.
Quality control is tight at Summer Classics and is, in large part, because of White's background as a textile engineer. He said he is constantly working with raw materials to make durable outdoor furniture. He said he currently is working on a paint and finish for cast aluminum furniture that won't fade in the sun and studying ways to make the resin wicker furniture line look more natural and realistic by adding imperfections in the weave. And, inspired by the new Christmas product line, he is determined to create a Christmas tree that no one will be able to tell is fake.