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EA to recruit designers

Will compensate outsiders for sales

By Clint Engel -- Furniture Today, August 17, 2009

DANBURY, Conn. — Ethan Allen will launch a program this fall that will pay independent interior designers for their client purchases at the stores, another step down a design-oriented path that the company has been taking for some time.

In an interviews with Furniture/Today sister publication Interior Design, Ethan Allen President and CEO Farooq Kathwari said the new Interior Design Affiliate Membership Program could add $100 million to $200 million to the company's annual sales.

The maker and retailer of upscale home furnishings will solicit as many as 2,000 independent designers in key markets across the country, he told writer Mark McMenamin.

November Rawlings, Ethan Allen manager of media and public relations, told Furniture/Today the Interior Design Affiliates won't get special pricing, but will receive a 7% to 10% “referral fee” on the sales they bring in.

Ethan Allen's in-house designers at corporate-owned design centers work in a team environment with each earning a salary based on experience and performance, and also participating in a bonus plan when the store meets sales goals, she said. The in-house teams stand to benefit from the IDA program too, Rawlings said, “as those sales generated by the Interior Design Affiliates will count toward each design center in meeting its overall sales objectives.”

For licensed, independently owned Ethan Allen design centers, where some still operate on a commission basis, “an equitable method of compensating their in-house designers will also be recommended,” she said.

All IDA applications will be submitted to local participating design centers and will be reviewed by “our team and Mr. Kathwari,” Rawlings said.

The company said the new program offers “qualified independent designers the ability to extend to their clients the full range of Ethan Allen customer services, warranties, and support” through participating stores.

In a conference call with the investment community last week, Kathwari said that there are thousands of independent interior designers and over time, many have asked Ethan Allen to work with them.

“We believe the time is right and we have a good plan to achieve this,” he said, calling the new program “a win-win situation” for the design centers and their in-house teams as well as the independent affiliates.

Kathwari said the program is integral to Ethan Allen's “natural evolution” into an interior design company with a growing custom business.

Ethan Allen adopting custom approach for wood business

DANBURY, Ct. — Ethan Allen has announced it will transform its domestic wood manufacturing operations into a custom business that focuses on individual pieces versus large quantities.

The transformation will occur within 12 months, the manufacturer and retailer said.

“Our custom capability is one of our strongest assets and a strong point of differentiation,” Chairman, President and CEO Farooq Kathwari said in a statement. “During the last few years, we have been making affordable custom upholstery in our U.S. workrooms and shipping more than 80% of this custom product within 30 days. Now we are converting our U.S. case goods manufacturing to custom in manageable increments, starting with four popular dining room collections.”

Kathwari said the transition will enhance the company's ability to “provide great products with unparalleled options at affordable prices.”

The company has six U.S. plants, and says that about 65% of the products it sells are made in the United States. Its case goods operations are in Beecher Falls and Orleans, Vt., and Pine Valley, N.C.

Four dining rooms will be the first case goods offered in the custom program. They will be available in four or five core finishes as well as some two-tone options, said David Callen, treasurer and vice president of finance. The company also is considering various table leg alternatives.

Callen said the company will expand the custom offerings across its case goods product line over the coming year.

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UPDATE: More details on Ethan Allen designer program

Aug 12, 2009

Ethan Allen sets new interior designer program

Aug 10, 2009

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