Friday, February 27, 2009

How to ensure your small business survives in these trying times.

An interview with gallery owner,
Penny Krieger of Paradise Oriental Rugs, Inc.
[This interview will be coming out in the next ACNA, Antiques & Collectibles National Association newsletter]

How long have you been in business?
I started my business in 1997 with two rugs that I had purchased from an individual. Prior to this I had worked at a commission only sales job selling rugs for another firm for seven years.
For the first 6 months with my new small business, I ran classified ads in newspapers and sold by appointment only from my home while working at second job.

After less than a year, I made the total commitment and quit the second job. Just as an aside, I did have a business licence and collected sales tax as the goal was to eventually get a retail store going.
My finances were pretty much hand-to-mouth for the first couple of years but loved the rugs so much I was very persistent and pushed forward.
Whenever I did well, I purchased more rugs and whenever I created an ad that worked, I noticed. I also maintained a keen awareness of what individual tastes were in my area...and used that as an index for any new rugs I bought.

When did you open your first retail gallery?
I opened my first retail gallery in 1999 in Santa Rosa, California. In 2006 I moved my business to Sebastopol, CA which is about 6 miles from my former location. The town where my gallery is currently located [Sebastopol, CA] only has 7000 residents but we're 10 minutes to Santa Rosa, which has over 150,000 people and a little over an hour from San Francisco.

Who are your customers?
I used to consider my client base rug buyers within a 50 mile radius but with my site, I now feel that anyone that has online access and is interested in the types of rugs I have is a potential client.

What are the most important qualities that determine the value of an Oriental rug?
Here are the factors from my perspective that matter the most, in their order of importance.

Beautiful colors. Colors are the paramount, second only to the artistic rendition of a good drawing. The drawing is the layout of the design.
Quality of the wool and how it is produced. The very best wool costs more than inferior wool. Hand spun wool has higher labor costs than it's machine spun counterpart.
Quality of the dyes and the skill with which they are applied. Natural or vegetable dyes are more time consuming in use and costlier to procure.
Skilled weaving. Look at the back of the rug. Is it a mess or are the rows neat and orderly?
Availability. Obviously, scarcity creates value, particularly is the piece is gorgeous.
Demand. Is the type of rug in question, all the rage or last years left over?
Cost of fuel as this affects shipping prices.
Value of the American dollar in international markets.
On antique Oriental rugs: Condition, beauty, actual verifiable age, rarity and market conditions all affect the value. The venue where it is sold and skilled marketing also influence the price. The large international auction houses in NYC and London have some of the most affluent buyers in the world so if a piece is museum quality these organizations have the widest international audience.

How have you managed to stay in business when so many rug stores have closed in the last few years?
By selling what I consider to be good quality rugs and having a specific niche that is mine. I've never liked what I call, "cookie cutter rugs" which is what you will find if you go to most of the large department stores. I was always more fascinated by pieces woven in small villages with a tribal look, beautiful hand-spun wool and deep saturated colors from the vegetable dyes, many of which are one-of-a-kind.

The Oriental Rug industry is interesting as some wholesale prices have gone down in the last few years and others have gone up. I guess my willingness to buy better quality merchandise and only from reputable wholesalers and producers has paid off. I have never used the cliche, "going out of business sale" or "lowest price" with the rugs falsely labeled some astronomical amount that is more of a fantasy than a reality. I did go by one local rug retailer's shop a year ago when he had been "closing" for seven years! He had a 3 x 5 silk rug priced at $17,000. but now it was only $3500! Suffice it to say, this was not a good deal.

When the Iranian embargo was lifted in 2000, I was literally was a kid in a candy store. The rugs that became available were nothing less that woven art. These were one-of-a-kind tribal rugs coming out of Iran that had never before been available. I filled my shop with as many as I could afford. The were not inexpensive wholesale but I took a chance and when qualified buyers entered my gallery, they were usually mesmerized. I had something different and although higher priced than what I had been selling prior, they were very well received and continue to be my best selling rugs, even now.

I also maintained communication with my clients by sending out a quarterly newsletter which always included some tantalizing photos of a few special pieces.

How has the business been the last couple of years with the Real Estate market declining and the different financial factors that are currently out there?
In all simplicity. More challenging. I have had to work harder, give better service, provide the potential client with what their needs are to the best of my ability.
I realized a while back that I needed a web site and it has proved to be a smart idea. I got my site started in 2006 and have added to it and improved it consistently since it's inception.

How many of your sales have come from your web site?
Minimally 30% of my sales last year were a direct result of my web site and as a sales tool, over 60% of my clients have been to my site, read my articles, and studied the rug photos in considering a purchase. The site has been invaluable. I have satisfied clients as far away as New York City, Virginia, Rhode Island and am working with a gentleman in Houston as we speak.
Even if it's only a sale here and there, it all ads up. When a gal walked in to my shop a while back from Montana and knew every rug in my store, I was very pleased that I had created my web site and my hard work was beginning to pay off.

How people find your web site?
I have spent the greater part of the last six months studying Search Engine Optimization and that is an entirely different conversation but what I have learned is this. People are looking on the Internet for information and if you give them accurate, understandable information for free, you can earn their trust. I have numerous articles on my site all based on questions I have been asked repeatedly for the last 15 years in the Oriental rug business.

With all the GOB's (going out of business sales) out there why do you think people buy from you?What I have heard most often is, "Penny, you have the most beautiful rugs!" The other comment I have been told over and over is that they trust me. I took the complements I have heard most often and used them in my advertising. That translated to my current ad campaign, "Beautiful rugs, sold with integrity!" Another quote that has gotten me countless sales is, "I will never sell you a rug unless you absolutely love it."

Is there any information you would like to share with other retailers?
I have seen numerous small businesses close in my area (Sonoma County, Northern California) in the last 6 months and not one of them put much energy into marketing with a little push or increasing their service! If you are not lazy and listen to your clients, give fantastic service and are actually selling something of value, you can get through this. Put up a small web site, work on it when you can. Write articles, hold small events, do whatever you can to promote within the context of your budget and when things get better you will be far ahead of the crowd and positioned quite possibly for a prosperous future!

Last man (or woman!) standing gets the prize! If any more rugs stores close, I may be the only Oriental rug dealer left!

Penny Krieger is the owner of Paradise Oriental Rugs, Inc., located in the San Francisco Bay Area in Sonoma County. Her gallery at 137 North Main Street, Sebastopol,CA, specializes in tribal rugs and carpets woven with hand-spun wool and plant based dyes with a strong emphasis on Persian rugs. 707-823-3355

Thursday, February 12, 2009

Where to see antique rug in San Francisco!

San Francisco Tribal & Textile Arts Show is ON now!

This incredible show starts tomomrrow with the "Preview Gala" on as I write!
If you have never been and you love rugs, this show is a must see.

Why? To see is to learn...the more rugs you see the better your understanding will be of new rugs, old rugs and Oriental rugs of merrit.

Old rugs have a certain mood and attention to detail that one often does not see in newer pieces. Many times they are more finely woven and you can really percieve the weaver's true intentions in the finished product...The museums are filled with such pieces and dealers from all over the globe will be there with their finds.

The SF Tribal Arts Show is on this weekend at Fort Mason Center and for those of you that live in Marin or Sonoma County, this is just across the bridge. It's only $15.00 to get in and having attended once, my opinion is that this is a very fair price!

Here is the link for anyone interested.

In addition to tribal rugs there will be other tribal art forms from all over the world. Arrive early and enjoy!

Here are few photos to get you in the mood.
The above rugs are all new rugs woven with vegetable dyes and hand-spun wool in antique designs from my gallery...timeless and beautiful.

Hope you find this information useful!