Sunday, May 24, 2009

Where in the World has the Design Guy Been?

It's been several months.... and I'm b-a-a-a-c-c-k!

Thanks for all of your cards, emails, letters, gifts and flowers! You really shouldn't have--but since you did, I'll take it, and thank you!

Oh! You hadn't noticed that I was gone?

Oh, yes, I was about to explain where I've been. Actually, I've been in Santa Barbara most of the time, focused on our business. Of course I've traveled a few times up to our Mill Valley store for meetings or to help out when needed, as has Caroline, and we even evacuated our selves to San Francisco to escape the recent wild fires that ravaged the countryside in and around SB (as in "OC" but we're in the "SB"!).
For amazing photographs of the recent wildfires, known as the "Jesuita Fire":

My sincere thanks to the men and women who battled this fire so valantly and served so many that were displaced. Thank you!

And then...

In addition to the fire, as if the world's economy isn't bad news enough, I watch the continual parade of dismal economic news and employment figures, negative first quarter business earnings reports, the automakers going bankrupt and closing many of their dealerships, all this after we've already survived record high gasoline prices and those projections of $150 per barrel oil (which fortunately didn't materialize). In real estate the statistical decline in housing prices marches on. All the while, I watch as our costs of doing business as a Mom & Pop retail store increase, seemingly on a daily basis though the retail price at which I can sell my merchandise is not rising.

Customers don't expect to pay more in down times, they want to purchase it for less., or they won't purchase it at all. Therein lies the major problem on the retail front.

Our Competitors--have they made a bed that we all have to lie in?

Fellow high-end retailers such as Saks 5th Avenue, makes it very difficult for us to compete (and for their direct competitor Neiman Marcus) when they discount the top brands early in the season. Taking early mark downs, Saks went directly to 70% off on some current season merchandise, bypassing the customary 20% sales which grow to larger percentage discounts as the season nears its end.

But, not Saks, not this year. They certainly achieved a goal of beating everyone to the punch, though I don't intend to go there and didn't, and neither did Neiman's.
It's a tough road to take, but we cannot run our business at a loss. Other businesses can't either, though I've always wondered how a business stays in business when they report yearly loss after loss, but yet are still going concerns. I didn't say profitable concerns, but they are still going, still in business somehow.

Take our freight costs for instance, to get merchandise delivered from the manufacturers in North Carolina all the way to the West coast, freight rates were typically between 14-18%, now their 20-22%, plus the addition of new fuel surcharges, making the effective shipping rate a whopping 25% of the costs of the goods shipped! Yikes!

Then, there are the unending notices of price increases from our Vendors, some of which haven't had a price increase in the last two years, but they've already had two price increases this year!

Sorry, I got a little off subject...what is the subject here? Obviously there are several!
I better have another bite of my orange.

Okay, I feel way better now! I'm ready! So, to revisit the purpose of this article, "Where have I been?" I've been fighting for every bit of business that I can by working my little tushy off, just trying to keep ahead of the curve.

In fact our business has risen slightly upward, steadily every single month since year end Dec/2008.

Where's the business coming from? Fortunately, we've seen at least one major interior design and furnishing job come through our doors each month. The jobs are furnishing a large part of, or the entire customers home .
These customers have purchased a home in our area, as mostly a second, or third, part-time residence, and they want to furnish it from the floors, up!

They "need" us to furnish it from the floor up, they have a need! Praise the lord...a customer who needs to buy furniture!

I just have to say it again: Hey, customers that have a need to buy! Wooo whoo!

The Media

And where are these people coming from? How do they know about our Cabana Home stores in Santa Barbara and Mill Valley, CA?
I've got to say that I firmly believe that they are coming from our advertising. Since we do not advertise on radio or television, that means the customer is coming from our print advertising.

Of course much of our business is from word of mouth, but I attribute the lions share of it to our advertising. Since the end of last year, we've focused and booked our advertising dollars with those media that produce results, namely the high-end home and fashion magazines; Santa Barbara Magazine, C magazine, the Montecito Journal and the Montecito Journal Magazine (or the "glossy", per the magazines first Editor), 805 Living magazine, California Homes magazine, California Home & Design magazine, and Marin magazine.

We currently run both statewide and local magazine ads. At the moment we are not doing any typical newspaper advertising--I'll let you know more about the impact of that decision after a few more months.

During this economic downturn, we've actually kept our advertising budget on par with last year, as I do not believe this is the time to have less presence in the market place, though others may be trimming their advertising budgets. In some cases, we're focused on placement rather than frequency.

Example: Last month we took a full page ad, on the back page of one of the more prestigious local weekly newspapers. The ad ran in a space that is usually taken every week by one of the hottest "see and be seen" restaurants in Montecito, CA. We rely in great part on word of mouth to augment our advertising, and after the ad ran, a "big hitter" (from Texas) who had recently purchased a second home in Montecito came into the store because they had seen our ad. They purchased $3,600 worth of lamps (quite a nice little lamp sale). It wasn't word of mouth that got them here, because they didn't really know anyone here yet, it was the ad, and I'm convinced the placement of it on the back cover.

Staging Your Home to Sell--What a Concept!

Where else is the business coming from? Of course we're fortunate to have the repeat customer, GOD love'm! We're also working in a way, staging houses for sale, though not in the conventional way.

We recently furnished a "spec" house, owned by one of our customers, for a lady (considered the most successful mortgage broker in the United States) and her husband, (an accountant).

This savvy business lady built a beautiful house in the prestigious Jack Nicklaus golf course community of Old Greenwood (, in Truckee, CA (that's Lake Tahoe).

Having been furnished initially by a local stager, and unsold six months latter, the owner was still paying multiple thousands per month for the use of the furniture, and she decided it might be less expensive in the long run to purchase furniture for the house, and that is, purchasing exactly the right furniture for that house.

A couple of things were at play here: 1. Properly furnishing the house would increase its appeal in the local market place, and 2. It would increase the attractiveness to a potential Buyer who would have the opportunity to purchase this home fully furnished, lock stock and barrel, which would make for an easier transaction for any absentee owner.

Left photo: Street side view of the property at Old Greenwood, listed at $1,895,000.
Right photo: View of the golf course fairways from the second floor deck.
This is one well-planned home. It features four bedrooms, with four private baths, the Living room with fireplace and built-in flat panel television and surround sound systems; high, beamed ceilings; Gourmet Kitchen (with two of each type of appliance!), a Game room, outdoor living areas with outdoor cooking and and sound system, all overlooking two of the prettiest fairways on the golf course. Sounds lovely? But it also sounds like every other similarly priced home that is for sale in the development.

In planning for the furnishings for this home, we worked diligently to give our customer the most complete home for the money that we could possibly deliver. At the end of the budget, we even lent them a major painting (not included in the price!) just to complete the interiors. The result? Judge for yourself, take a look at the new interior pictures below.

We also worked with their real estate broker to insure that we all had the same understanding of the customer for which we had furnished this home. I had specific talks with the broker/Realtors (remember, I'm retired from a twenty year career in real estate!) about getting away from the old way of selling a home based on "price per square foot". It's cliche, and my belief that nobody bases their purchase of a new home solely on price per square foot. Sure it's a factor, a guide if you will, in their decision making process, but it's the house itself, and everything it entails that establishes the value.

It's the customer considering the look, the feel, the way it fits their needs, and their dreams that drives them to select one house over another. That's the way to sell in today's economic climate. Forget the numbers! If the numbers where that important, then no one would ever purchase a house again--they would rent!

The look? Well, I must say we restrained ourselves from the Paul Bunyan look! No red plaid fabrics, no stitched deer-hide lamp shades, no antlers or horns on the walls (we prefer those on our Cadillacs in Texas). We passed on the typical hair-on cowhide upholstered furniture.

Instead of rustic spilt-log furniture, we opted for antique, primitive rough-hewn Chinese alter tables; naturally woven linen lamp shades instead of the deer-hide versions; we used a naturally woven grass rug instead (see the Merida Meridian rug, pictured below, and at the Cabana Home stores in Santa Barbara or Mill Valley, CA ( of a more expected braided rug; an upholstered headboard of raw silk instead of a more traditional wooden bed.

We used a subtle creme and tan hounds tooth pattern fabric in lieu of a the more typical bright red and green plaid, and bent just about every current rule for mountain-house design that is currently so obviously popular--and overdone to death! See more pictures, below.

From the Bengal Collection of 100% Jute woven rugs from MeridaMeridian available at Cabana Home Stores. Left: Style Reef; Right: Style Bora Bora.

Oh, and one more thing...we did not set the Dining table to look like someone was about to eat. If the idea is to set the table to make the house looked lived in, then to me a set dining table looks like the owner is about to have a dinner party and we better cut our appointment short so we can get out of the hosts way! We put a lovely centerpiece on the table in a wonderful clay container and called it a day! Leave the Martha Stewart details to the potential Buyer. Let them visualize themselves setting whatever table they envision as they stand in the beautiful Dining room contemplating the purchase of this home.

Re-positioning this spec-house in the marketplace was a well thought out decision by the Owners, and the Realtors, we were simply the facilitators. And, once the home is sold, if it doesn't sell furnished to the new Owner, then this homeowner will use the newly acquired furniture to upgrade and augment what she already has, and pass on the former to her kids, friends and relatives. All in all, everybody wins with this scenario.

More about Staging (in order to sell your home)

Statistics for your consideration of whether or not to stage your home are plentiful on the Internet (as are the "stagers" themselves). Basically it boils down to this: A vacant home that has been properly staged sells faster and for more dollars, than a non-staged home. Likewise, homes that are occupied that are staged, sell faster and for more dollars.

Curious as to why one would stage a home that is lived in? Consider this, we all have our homes decorated and furnished to suit us, and our lifestyle, but does it suit or fit that of a potential buyer?

Answer: Usually not. we may have too much furniture in a room, such as an extra large dining table with multiple chairs in a space that is far too small to accomodate it. Perhaps we have a need for the large table and the chairs to accomodate our large family, but if your home is on the market, it conveys to a potential Buyer that the Dining room is too small, and then just maybe that the house is too small as well.

Enter the Realtor!

In preparing to place a home on the market, more often than not, the Realtor has to tell the homeowner that they need to consider removing some of their furniture, accessories, or art, form the house, which is most often met with a stinging response from the sensitive homeowner.

Classic homeowner responses: "It works for us, and that's just the way we live"; or "they'll just have to get over it" or even ; "if they pass on our house because the dining room is too small, then this house wasn't for them."; or how about this, "they can see past that, if not then this house isn't for them", or, "I like it like this, it's why I bought this house".

Shivers go up my spine as I look at the responses above, having actually heard them myself. The worse the homwowners reaction to my suggestions, the lower the price they would eventually get for the house. The more cooperative, the more money they would get for their home. It happened everytime, over and over again.

So dear homeowners, please know this, the Realtor knows very well that it's your home. They are more sensative to that fact than anyone else who will be looking at and/or decides to purchase your home, so lighten up. Remember, your the one who has deciced to sell your home, whether you wanted to or not, and it is up to you to hire the person that you think can do the best job at marketing the property, negoitiating the terms of the transaction, and getting the transaction closed. The person who knows how to do these things also knows exactly what it will take to bring you the highest dollar your home will bear in the current marketplace, and they know exactly how to postion and stage your home in order to do so. So once you've picked the right guy or gal agent, once you've done it, get out of the way and listen carefully to their suggestions. While your home is on the market, it's not about you, or at least not until there is a written offer from a Buyer on the table. Until then, its about the Buyer, and making the house as appealing as possible to the broadest range of potential Buyers.

Best tip for any homeowner: Never create an adversarial reatlionship with your Realtor, they're out in the public on your behalf, fighting to get your home noticed and sold. Make them want the best for you by listening carefully to what they're telling you. It would be a rare bird (Realtor) indeed that wouldn't have your best interest at heart.

Other links for getting your home ready to sell:

From the National Association of REALTORS: "Field Guide to Preparing and Staging a House for Sale":

Check out : "How to Prepoare your House For Sale" at:

Also, this site has some good but basic ideas for selling a home:

Or, follow this link for ideas about getting your home ready to sell:

Or, this link to avoid the "Seven Costliest Mistakes seller Make":

All for now! Next up on the Design Guy blog: Part III of recent European travels!

PS: I have no idea who this kid is in the above pictures, but he is darn cute! I found these picutes on the internet so if he's your kid thanks for letting me use the pic's!

Goodnight Moon

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