magazine | Jan 27, 2022 |
How this designer locks in wholesale pricing

Birmingham, Alabama–based designer Douglas C. Davis has adjusted his approach to shopping as his eponymous firm keeps adapting and growing. These days, sourcing challenges have shifted his vendor loyalty and helped him clarify what he’s looking for from his partners.

How this designer locks in wholesale pricing
Douglas C. DavisCourtesy of designer

When you first launched your firm, you resisted opening trade accounts. What was that about?
I thought we would just go find unique things for every project. I didn’t want to be pigeonholed into always selling X lighting brand or Y upholstery brand. But over time, we’ve changed that strategy—partially for pricing, but for quality too. If you find stuff that’s consistently good and in stock and then fill in with unique pieces, that solves some easy problems.

Was it hard to run a design business only sourcing one-of-a-kind items?
It was—and it actually didn’t create the variety that we expected, because we were still always shopping at the same places. If we’d been able to run around the country for every project, it might have worked, but that’s not always the case. Opening a trade account is a smarter pricing and purchasing strategy for us.

Are buy-ins and order minimums a significant hurdle?
We opened an upholstery account this year with a pretty significant buy-in. We had to wait until we had a big enough job so I didn’t end up owning a bunch of product in order to get just one thing.

Have you ever wanted a piece so badly that you just bought, say, six extra chairs?
To access a lighting line at a really good rate, I bought more than I wanted to this summer—and more than I probably should have. But it can make sense when the opportunity is right, especially if it is a long-term strategy. Now we have wholesale pricing with this account forever, and look at what that’s going to do for our profit margins three years from now. That’s worth investing in upfront.

Have you been working toward getting in at the wholesale level from the start?
No—I don’t know if I understood all that as well as I should have when I first started. Thankfully, as my business has been successful, [wholesale purchasing is] an opportunity that’s been afforded to us. I started with two people in the office, and now there’s six of us. It’s taken a decade of organic growth to get to the point where I feel like we’re really getting aggressive pricing on stuff.

Is your relationship with vendors different depending on the category?
We have found we get the best pricing on things like upholstery and lighting. Fabric pricing kind of is what it is—I don’t think there’s another tier of pricing we’re going to break into with that. When you’re buying through multiline showrooms, the pricing is pretty well controlled.

How else can you chase down better margins on product?
Finding custom vendors is the final frontier, because it offers you the opportunity to cut out the person in the middle. Now, I don’t know that I want to start printing fabric, necessarily—I don’t want to have to put my fabric in every single project just because I have great pricing on it, or to pen in our aesthetic because I have a bunch of stuff in a warehouse. I don’t ever want it to stop being about design, but of course, we all want to make more money. We used to buy these beautiful custom English dining tables through an antique shop that we love; then we realized that there was someone locally who reproduced them perfectly, and instead of getting 20 percent, we now get 60 percent. We’ve also got a great blacksmith who will make any steel piece we can dream up, so instead of buying a black metal bookcase from a retailer like Room & Board, we can have it made to the inch ourselves. And in addition to better margins, those opportunities to make the project really special for each client are important.

Has the pandemic changed the way you work with your vendors?
I know we’re all tired of talking about logistics, but it’s not going away—it’s only getting worse. The brands that have stuff in stock, that’s great. And the ones that accurately have things in stock—that’s even better. We’ve had vendors sell us something and then we turn around and it doesn’t actually exist, or they’ve told us they have 100 yards, but later tell us it’s in six pieces and the cuts don’t work. Having access to accurate information is really important, so that we’re not showing people stuff that we know they can’t get. It’s changed how we shop and who we shop with, to some extent. We’ve become much more loyal to certain vendors that are getting it right—and we’ve also realized who we can’t rely on as much.

This article is part of a series of interviews that explore different approaches to shopping, offering tips and strategies to make a firm’s sourcing more efficient, more inspiring—and more profitable, too. Want to read more? Explore the rest of the series here.

Photography: In a ground-up new build, Douglas C. Davis crafted a thoroughly modern kitchen imbued with a sense of tradition. | Jean Allsopp

This article originally appeared in Winter 2022 issue of Business of Home. Subscribe or become a BOH Insider for more.

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