Solving the Struggle with Furniture Procurement
Designers who struggle with the time-consuming details of furniture and accessories procurement will understand exactly how Doug McKenzie saw an opportunity to relieve that struggle for the interior design industry. Fourteen years ago, he opened up his own boutique procurement company in Seattle, called objekts.
Doug understands the frustration that procurement can cause. He’s seen the intense effort required to procure furnishings during his very first job after college as the operations manager for a biotech firm that underwent an office relocation. With a newly-minted degree in psychology and no design experience, Doug was tasked with hiring brokers, a design firm and a brand agency to support the move. “Through the process of hiring an architect and brokers, I got introduced to the role of furniture and procurement,” he explained during our recent interview.
“If you mix up just one model number, you could easily own a $10,000 sofa that you have no place to put,” he laughs.
A Disconnect: Typical Furniture Dealers vs. Designers’ Needs
His first job gave Doug a taste for the design world. Before long, he had fully jumped into commercial office interiors working for a contract furniture dealer in Seattle.
“There I experienced the disconnect between most contract furniture dealers and the architectural and design community. Furniture dealers tend to work in limited markets; typically just corporate, healthcare, and education. But my design contacts worked in a much wider spectrum and they needed procurement for other markets like retail, restaurants, hospitality, multifamily, residential and building repositionings. I saw the need for this niche — not just a small niche, but a large one — to support furniture and procurement across all of these different market sectors.”
And so, objekts was born.
The Procurement Pain-Point
Designers get into this business because they want to design. Procurement is often a drag on the design process; it’s intense, time-consuming, and requires a lot of detail. While Doug acknowledges that “procurement can be seductive because of the potential profit,” he notes in the end that it’s rarely worth it. “Procurement can take as much as 60 percent of a designer’s time and focus, with only 40 percent left for design.”
Even more concerning is the potential liability for procurement mistakes. “If you mix up just one model number, you could easily own a $10,000 sofa that you have no place to put,” he laughs.
It’s funny because it’s true, and Doug has seen those kind of mistakes first hand. “We certainly learned a few lessons the hard way in the early days. That’s why we have a solid process in place now, so we can take care of all of the purchasing and procurement details and let the design firms focus on what they do best, which is design work.”
Solutions for Smaller Design Firms
So what can small firms do to make procurement easier, since outsourcing may not make financial sense for small scale projects? Doug explains the tipping point: “These smaller firms may do 90 to 95 percent of their own purchasing, but when they sign on a project that’s large enough, it’s often worth bringing in help with the procurement. It becomes worthwhile because of the potential liability and ramifications of mistakes, as well as the time intensity.”
“The busier a firm is and the more projects are coming in the door, the more it makes sense to outsource procurement,” he explains. “In my experience, as firms continue to grow, they really struggle with being able to maintain that service in-house. It also requires a lot of intense training to address liability concerns.”
Doug knows first-hand the challenges of managing a growing business. He runs two companies including objekts’ sister company, objekts Represents, a rep group that provides product specification services for design firms across the Northwestern U.S. Doug’s husband Todd Johnson leads the rep group, and together they balance their businesses with raising their two young kids, Haden and Jasper. Add a passion for travel into the mix — not to mention the needs of everyday life — and any opportunity for simplifying becomes a necessity.
Doug often helps advise young firms that are looking for ways to make their procurement process easier and more efficient. He recommends a procurement software solution as a cost-effective first step.
“Instead of trying to piecemeal a procurement process together using Excel or Word, which can quickly lead to problems, there’s a number of purchasing software packages available that can help with producing purchase orders and proposals, and provide helpful accounting tools.”
Different software will be right for different firms. Some are focused on serving the needs of small, boutique designers, while others are better suited for large organizations that have millions and millions of dollars in purchasing running through their accounts.
Another smart strategy for small design firms is to work with an accountant that has experience with interior design businesses. “It can be difficult to account for a lot of inventory flowing through but not staying static,” Doug explains. “It’s important that your accountant understands that.”
The Value of Outsourcing Procurement
Everyone has bought a piece of furniture at some point, whether it was at a garage sale, Ikea, Crate & Barrel, Room and Board, or a high-end design shop. It doesn’t matter what your socio-economic level is. People generally understand the process it takes to explore all of the options, weigh the budget and design considerations, and go through the process of ordering, scheduling delivery, and installation. But to add an additional cost to have an expert step in and take over that process for you, Doug says that it can take a bit of explaining to understand the value.
“More often for residential clients than for commercial spaces (which often have a facilities manager who is more procurement savvy), we need to walk them through our role and why it’s important. It can be a bit staggering for a client who may be building a 5,000 square foot home and needs to spend upwards of $100,000 to furnish it. And then they need to tack on procurement services.”
Taking a look at the list of services that objekts provides, it’s easy to see the central role that the company plays in executing a design project. Depending on the client and project needs, Doug’s team can help with:
- Curation: Relationships with a vast number of artisans and manufacturers, oBJEKTS brings together accessories and furniture options from across the world to help create a unique space for each client.
- Procurement: Clients aren’t limited to specific product lines. Doug and his team have made a point to be brand-agnostic, which offers clients greater freedom to create their own unique spaces.
- Sourcing: For the client that just has to have the chair they saw in the latest Wes Anderson movie, oBJEKTS will track down the illusive or unique. The company’s website says, “If you can dream it, we can find it or have it made.”
- Installation: The procurement process right through the finishing touches. oBJEKTS partners with install teams to manage the receiving, warehousing, freight claims, delivery and installation processes.
- Custom Solutions: When no product seems quite right, the company helps clients execute their own original design vision with a network of trusted fabricators, woodworkers and artisans.
The procurement industry is full of massive dealerships that handle $500 million to a billion dollars of product each year. But not everyone wants to work with the mega-companies. Some of those big dealers have launched smaller dealerships to try to capture the more boutique market. It’s important to make sure that the procurement partner you work with is the right fit for your business.
Movin’ on Up
Today, objekts is exploding with 250 percent year-over-year growth and a new second office location in Portland, Oregon. It’s busy with work for clients from every corner of the design field: from local restaurants and law firms to Microsoft and Holland America, and from boutique design firms to international names like NBBJ and GGLO. It just partnered with West Elm to be the retailer’s exclusive dealer representative for its WORKSPACE line, and the rep group has a showroom in Seattle and is soon opening one in Portland as well.
So you could say things are going well. Fourteen years ago, Doug McKenzie saw a need among designers who wanted help managing the procurement process. He built a business to fill that need, to the relief of designers everywhere who truly just want to focus on design.
Doug McKenzie owns objekts, the leading brand-agnostic furniture procurement company in the Pacific Northwest. Learn more at objektsllc.com