
Host Dennis Scully and BOH executive editor Fred Nicolaus discuss the biggest news in the design world. Later, BOH editor in chief Kaitlin Petersen and retail columnist Warren Shoulberg joined the show to recap High Point Spring Market.
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Dennis Scully
This is Business of Home. I'm Dennis Scully and welcome to the Thursday Show. Later on, I'll be recapping High Point Market with boh's editorial team. But first we're going to catch up on the news, including the latest housing numbers, designers advertising on Instagram, and why Form Kitchens has halted operations. To do all that, I'm joined by Business of Homes executive editor Fred McVeigh. Hi, Fred.
Fred McVeigh
Hi, Dennis. How's it going?
Dennis Scully
Great. Happy to be home with you at last. Fred, welcome back.
Fred McVeigh
I know we're going to really get into the weeds on High Point with Caitlin and Warren later, but what was it like? How'd your panel go? You had a huge panel with what, 10, 20 people on it?
Dennis Scully
An enormous panel partially in celebration of Jeremiah Brent's new rug collection with laloy. And we had some all star panelists, Mikel Welch and Asnesawa and Brian Paquette and Ashley Montgomery. And a packed house at the High Point theater, which I do have to say, Fred, one of my favorite places to be.
Fred McVeigh
Yeah, it looks like a great event. Although you made a very, very crucial mistake, Dennis, which is that you are next to Jeremiah Brent in a picture. I never do that. The man is just so handsome.
Dennis Scully
It helps me see what I need to strive for, Fred, and what I need to work on, you know?
Fred McVeigh
Exactly. I don't think no amount work is going to bring me up to par with Jeremiah. Anyway, let's look back on Monday's episode, a big one, Joanna Gaines.
Dennis Scully
Yes. A conversation that I'm often having at the High Point Theater at High Point with Joanna Gaines. In fact, she was not able to come to this. Marcus. She was nice enough to come on the podcast and pick up a conversation that we were having last time we were together, which is her thinking about all the things that she might say yes to and wanting to perhaps take a little bit of a get some distance. We had a really nice conversation. It was really a pleasure to have her on the show at long last.
Fred McVeigh
Yeah, I love that you were talking about how she was born a no person but became a why not person and how that really, really made the difference in growing Magnolia. Just fun to hear, kind of a play by play of how it all came together. Huge entity in our industry. And it's kind of nice to hear it sort of brought down to earth because you think of these big companies that get built up and you think that, oh, there's somebody with some crazy master plan who's playing 10D chess and sees really far. And she was really talking about just sort of taking each step and making it intuitively and making decisions based on intuition. And that was really refreshing. Just a lovely person to hear from directly and a great conversation. And you got her to weigh in on Shiplap and modern farmhouse, which I definitely appreciate. She's not backing down. She's still a fan. She lives in a modern farmhouse.
Dennis Scully
Well, exactly. That's her home. But what I thought was so interesting and I think something that a lot of listeners can relate to, she talked about this lens through which to think about making decisions. That whole point of what to say yes to or what not and growing for growth's sake, which is a conversation that I've had with a lot of people. She really talked about. Okay, here's a framework for how to think about that that I think a lot of people can apply to your point, even if they're not as famous as Joanna Gay.
Fred McVeigh
Well, it was. It was having a mission statement for the business. You know what I mean? And I think, I think, you know, I've done lots of interviews with designers who are running two or three person operations, and they come up with, you know, a statement of purpose, and it really does help them make decisions in their business. So what this is leading up to, Dennis, is our mission statement that we need to. We need to do a workshop, perhaps retreats. Maybe we can get the company to pay for this and come back re energized and refocused.
Dennis Scully
Maybe we need to go and visit the silos in Waco. Fred, let's field trip, right? And then we can come up with our. With our mission statement. I think that sounds great. I think a trip is in order. All right, we're going to take a quick break and then we'll get into the news. This podcast is sponsored by Jaipur Living. Since 1978, Jaipor Living has redefined rug making, where the value lies not just in the rugs themselves, but in the hands that create them. Every piece is a reflection of heritage care and extraordinary craftsmanship passed down through generations of artisans. For interior designers, the Jaipur Living trade program offers more than just exclusive benefits and insider pricing. It offers a trusted partnership rooted in Service. With over 2000 rugs in stock and ready to ship, they make it seamless to deliver timeless style and substance to every client. Apply to become a partner@jaiporliving.com this podcast is also sponsored by the Crate and Barrel trade program designers. If you haven't joined yet, it's time to check them out. You'll get access to beautiful High quality furniture and decor from three design driven brands, Craton Barrel, CB2 and Kraton Kids, right at your fingertips. Plus a dedicated concierge team to support your projects from concept to flawless installation. Members also get an exclusive 20% discount with no minimum purchase. Join today@ CrateAndBerrel.com trade and start enjoying all the perks. And we're back. First up, Fred, sadly, trouble at Form Kitchens.
Fred McVeigh
Yes. Last week BOH broke the news that the direct to consumer cabinetry brand had stopped taking new orders and laid off most of its staff. Seems like Form Kitchens is probably headed towards a shutdown of some kind, which.
Dennis Scully
Is very sad and we've had lots of communications with the brand and a lot of back and forth and knew some people involved. I'm sorry to to see it end this way. We should take a step back and tell people a little bit of what Form Kitchens is and what the model that they had introduced and we're trying to make work.
Fred McVeigh
Yeah. So Form Kitchens was launched in 2021. It was a Covid company, although I'm sure they came up with the idea before that. It was trying to fill this white space that we've probably talked about on the show before. There's a big range in between IKEA kitchen cabinetry and the really expensive stuff. Like I'm going to pronounce this wrong, but both help, you know those very high end European brands where it's, you know, the $300,000 kitchen. So there's a huge price range that's very empty between those two options. And there's a lot of small startups and companies that are trying to fill it up with kitchen cabinetry that's very design oriented but does not cost hundreds of thousands of dollars. And so that's what Form Kitchens was trying to do. They were taking direct to consumer approach. They were selling cool looking cabinetry, well made, at a reasonable price point and it had a showroom in the design center here in New York and they were definitely reaching out to the trade and it appears that they just kind of reached the end of the line and their manufacturer was this company called Nobilia, which is a big German kitchen manufacturer. And you know, I don't know exactly what happened, but kind of reading the tea leaves, it seems like they fell behind in payments. Nobilia or they had some kind of dispute with Nobilia and now it seems like Nobilia is picking up their orders and attempting to fulfill as many of them as they can. So that's kind of what the transition is like at the moment?
Dennis Scully
Yeah, it's such a complicated business. And funny enough, I think I shared with you recently that I almost went to work for a German kitchen maker. And in a way I was glad that I didn't because it is so complicated. And I thought, I'm just never going to remember all of these cabinets and drawers and places to put your carving tools, but there's so much that can go wrong on a kitchen order. And so I was always nervous about how they were going to do this in an easy online model. I mean, what's your sense, beyond the housing issues, of what might have happened here?
Fred McVeigh
Yeah, I don't want to speak out of turn because I don't have any inside information here. It's not hard to think of why a direct to consumer kitchen cabinetry company would go out of business in 2025 because of all the housing struggles. Also, as we've talked about, the expense of reaching people online is so much more than it was even a few years ago. And so all of your costs are going up. The demand is probably affected by and probably tariffs didn't help as well. So there's a lot of uncertainty. And look, startups fail all the time. It's actually more uncommon that a startup succeed. So it's really not terribly shocking. I think it's just kind of too bad because clearly there is this need in the market. You have all these millennials who have maybe graduated from Ikea and want something cool and designy. And so you do have lots of people trying to get into this market. We've had Semi handmade founder John McDonald on the show, very similar kind of company, even though they approach the market differently. You've got a company confusingly named Reform, which does a very similar thing to Form. You've got Isla Porter, which launched recently. So there's clearly an opportunity and there's a there, there. I don't know why form wasn't able to make it work, but it's both not hard to imagine why they tried to do this and why ultimately they hit this roadblock and are now apparently in some kind of state of closure or shutdown at the moment.
Dennis Scully
And what's your sense of where this ultimately goes? It doesn't sound like we're thinking that form at least is coming back, but does the manufacturer step in, take over the showroom, or what do you think?
Fred McVeigh
Well, I don't know. I've heard rumors and there's an active thread on Reddit about this and some people are saying that Nobilia is essentially going to take over their business. LinkedIn stalked a couple of the designers who have changed their employment from form to Nobilia. And so it wouldn't be shocking if Nobilia just came in and tried to use this as a framework for opening up their own direct to consumer operation here in North America. That certainly could happen. It's possible Forum can come back in some way, shape or, no pun intended, form, but when you shut down this hard and they laid off all their employees in March, it doesn't seem likely. And it's certainly not good for the other startups in the space either. I think when this happens, there's this inclination that it's like, oh, this must be great for the guy down the street. But all these companies are having the same kinds of struggles and they all probably want to raise more money. And when there's an example of someone doing the same thing going out of business, it's harder to go to your investors and say, hey, what about five more million? It's just not good for the landscape overall. So we'll certainly keep an eye on the other startups and I'll hope for their success. But it's certainly a tough business.
Dennis Scully
Well, and a reminder of why it's still such a strong business for Ikea, because it is hard to come after their strong foothold in the marketplace. But many are trying and we wish them well. Next up, the latest housing numbers. Existing home sales just recorded their biggest monthly fall since 2022, pointing to a continued slump in the housing market as mortgage rates and home prices remain high. Some of these numbers, Fred, they're a little unsettling. Yes, yes.
Fred McVeigh
What a bummer. Sales of existing homes declined 5.9% in March. It's tough. This was supposed to be the big comeback season. Spring is a big home buying time of year, and a lot of people were looking at the 2025 Spring Market to be the great resurgence that's subsequently led to a rise in furniture purchases, course jobs for interior designers. And, you know, the early numbers are certainly not, not looking good. I saw some statistics talking about this being, you know, the slowest market since 2009. And whenever 2009 gets inserted into an article about housing, you know, it's not, not a good look. So it's, it's, it's a little bit of a, a little bit of a bummer to see these numbers, especially coming.
Dennis Scully
Off of the past two years, which were the worst numbers since the 1990s. So, I mean, again, everybody, you know, to the Whole point that we talk about so often now, 2025 was gonna be the thrive time and everything was gonna change. And then between March and April, we also saw 14% of home sales were canceled, which we assume is tariff related, or the anxiety around tariffs more specifically. But it's just a lot of anxiety. Rates are still much higher than people want. I saw the CEO of Compass was saying, well, if it got back to 5.9 again, I think it would all turn around. But who sees that happening anytime soon?
Fred McVeigh
No, it's tough. Survive to 25 and thrive. I mean, I wonder how many people base their business plan off the fact that thrive and 5 rhyme. I hope not too many. But people had reason to believe that we were going to head into a more optimistic period. And as you were just explaining, none of the numbers are bearing that out. Mortgages are. The rate on a 30 year fixed mortgage is almost 7% going in exactly the wrong direction. There are small silver linings in the data. New homes apparently are up a little bit, 7.4% from February and 6% higher than a year ago. So home builders are clearly doing the right things. There was some analysis saying that they're building sort of slightly smaller, more affordable homes, which is clearly right for the market. You were saying earlier though, that some regions in the country are seeing home prices drop a lot. I think that'll actually unfreeze the market. If prices come down a certain amount, doesn't that just push people to make a decision one way or the other, even if mortgages are still high?
Dennis Scully
So we've seen a dramatic drop in home prices in Austin, Texas, for example, which was an area that so many people moved to during COVID And perhaps because so many people moved there, there was so much building that went on there, and perhaps it got a little bit ahead of itself. Turns out that the amount of jobs in that area that people thought were going to be created as a result of everybody coming didn't really materialize. And so people are leaving and guess what? They've got to sell their homes. And so you're seeing a particularly pronounced drop in that area. But you did see a 4% decline in Tampa. You did see a 3% decline in Jacksonville. So you are seeing some cracks in what were very hot markets. And in an odd way, that's what people are hoping will happen just to bring prices down, at least until rates can come down. This whole issue of just housing affordability in general remains very challenging. I was reading the latest newsletter from our friend Jonathan Miller, who writes the Housing Notes newsletter. And he just describes the whole market as just. Just damaged.
Fred McVeigh
Yeah, damaged is a good way to put it. It's funny, I was having a conversation with the CEO of a business in the industry, and we were talking about these numbers, and he was just saying, we just can't catch a break. It really has been so difficult ever since the COVID home boom ended. All is geopolitical unrest. And everyone was a little bit excited after the election last year because it seemed like numbers were popping up and then all the tariffs and the housing numbers come in and things are bad again, so. So I don't know that there's a ton of silver linings here, but it won't stay this way forever. It's just. It's taking a long, long time to see the trend reverse. And the latest numbers are certainly discouraging in that regard. We're gonna have to come up with another rhyme. I think we've been talking about it.
Dennis Scully
Before, but yeah, we gotta get on our. Get it fixed in 26 or whatever we're gonna say for 26. But we've gotta move on, Fred, because there's a change at the top for the Expert, which we're gonna talk about.
Fred McVeigh
Yes. Four years after co founding the startup with designer Jake Arnold, CEO Leo Siegel has stepped down to become executive chair. Now E Commerce veteran Leanne Blake has taken over at the company's helm. And last week I sat down with her to chat about her new role. What'd you think of my interview, Dennis?
Dennis Scully
Well, I know that we're going to have Leo and Leanne on the show actually next week, so I'm looking forward to that. What was your sense of where things are?
Fred McVeigh
Sure. Well, I think it's, you know, the expert's sort of at an interesting moment. Right. Because when it launched in the middle of COVID it was this platform for design, sort of the creme de la creme of the design industry, to give virtual consults online and charge a lot of money. But a few years later, talking to Leo and Leanne, the Experts business really now is not getting a cut of those commissions. Leo said it was something like 20% of their revenue. Whereas the vast majority of it is coming from the fact that they do a lot of E Commerce. They sell the brands that these designers shop. I think what Leo and Leanne really made clear is that they launched E Commerce thinking, okay, we're going to bring all these cool brands to the general public. But I think what they found out was that. But when you're Selling Pierre Frey. It's not Joe off the street who's buying it, it's designers. And so really what their business has been like for the past year has been trying to build this E commerce engine for the trade. Leanne is somebody who has an E commerce background. She worked at Babylist and a couple other places. And so you want someone who understands E commerce. She is that so. I don't know. It's just interesting to get a sense of the fact that even though most people I think probably still think of the expert one way, what their business actually is is very different.
Dennis Scully
I agree and that's why I'm really glad that you had the conversation you did and I'm glad that they're coming on the show to talk about this. Interesting that Leo, co founder, as we pointed out, recognized he's not the one to scale it. He's not the one to take it to the next level. Scaling, of course, Fred, one of the words that scares me the most when it applies to our industry, especially because I think this is the moment where so many of these companies get tripped for one reason or another. Can this really be scaled in a meaningful way? Can all of these brands, the apparatuses, the Schumachers, can they really be scaled on some kind of E Com platform, some kind of digital multi line model? We shall see.
Fred McVeigh
Yeah. I mean it's an entirely different business. You know, when they launched it was very exciting because it's like, okay, well Heidi Kellyer is. There's fans who live across the country and can't reach her and hire her, can get an hour of her time. Heidi can make a good amount of money and this works for everybody. It was relying on only the top of the top designers and relying on their time. Both of those things are very finite qualities. If you want to grow, you have to do something different. I think the challenge here is just that what they want to be is this purchasing agent for designers. If a designer wants to buy from a bunch of different brands and do it easily online, the expert is there. It's kind of like being a multi line but only being online. The problem is it's a complicated business because it seems great in theory because designers are like, I'm shopping from 10 different vendors, it's hard to get quotes and why don't you just put it all in one place and make my life easier? But when one thing goes wrong, it's really difficult to have this intermediary be this E commerce site. Other people have tried this and had problems with it. I know, the expert has some unique advantages and they have a lot of money and they have someone who's an experienced executive at E Commerce. But I do think it's a complicated business and I'm eager to follow it closely now that they have this sort of new direction.
Dennis Scully
And now the challenge is. And it's interesting to the point of how much they have shifted away from the consultation model. Leo talked about the fact that they're only bringing on one new designer a month to do consultations. So that is clearly not the big driver. It's very challenging. And this is not lost on Leo. Leo and I have had this conversation a hundred times, but this is what has to happen next. And this is an exciting opportunity. Opportunity. Let's see if it can work. And I look forward to talking to them on the show next week about all of it. Moving on, we're going to talk about Instagram advertising. Those in the market for interior design services might have noticed something new on Instagram recently. Designers have started advertising there. Fred, you took a look at this phenomena. What did you find out?
Fred McVeigh
I found out that a lot of designers are advertising there, I guess, just to start off. Did you notice, have you seen this before yourself? Have you seen designers advertising in your sort of Instagram story feed?
Dennis Scully
So it hasn't popped up in a meaningful way for me, but that's because so many English tailors and Swedish clothiers are clogging the works there, and so the ads just aren't getting through.
Fred McVeigh
We haven't heard from your trainer or your shirt maker this episode, Dennis. Hopefully they'll come back next week. Yeah. That's the funny thing about Instagram, right, is that you think everyone is seeing the same thing as you. Of course they're not because they don't have your algorithm, them. I just found it fascinating because I had never really noticed this before and it clearly was a bit of a phenomenon. I think there was one day where I got something like 20 or 30 different ads from local firms. And so I sort of went looking into what's driving this. Why are people doing this? Is this truly new? Does it work? What does it mean for the media landscape? And talk to a bunch of people about it.
Dennis Scully
Well, Fred, on some level, doesn't it make all the sense in the world? I'm amazed that this hasn't started happening sooner. And particularly with everyone doing more video and more content. And so, I mean, it just feels like, yes, this is the platform that has so many eyeballs, Right?
Fred McVeigh
Yeah, it does make all the sense in the world, really. I mean, I think that, like, why people haven't been doing that much earlier is because you kind of didn't need to. You know, when Instagram was first getting going, it was easy to grow organically. So many designers got really big audiences on Instagram and got jobs through simply posting their work. But I think, you know, in recent years, there's a real growing awareness that the platform has basically become pay to play. You know, unless you're making, like, dance videos or reels or whatever. And you're particularly good at that, if you want to see your stuff get seen by a large audience, you. You have to put, you know, some nickels in the machine. And because so many designers have gotten jobs through organic growth, they're like, okay, I get it. I'll make the change here. But, you know, I feel like it's. There's another thing, too, which is something that. That we've talked about a little bit before, which is there's a little bit of a stigma around advertising in the design industry. I think Stephanie Savi talked about how, like, it's this industry where you're just supposed to sit around and pray for rain. You know, you're supposed to wait for word of mouth to pan out, which can take months or years. And especially because we're in a bit of a slow time in the industry and not everyone's pipeline is totally full right now, I think designers are especially eager to get new leads, get new jobs. And here you've got Instagram, which has kind of always been there. Here's something you can put a few dollars into and maybe get a return. And so I think the sort of. The decline in the overall industry and the rising acknowledgement that Instagram is pay to play has pushed a lot of people to give it a shot for.
Dennis Scully
The first time, which, again, makes so much sense. And I would be thrilled, and you mentioned this in your article, if we could get past this stigma of designers having to hold themselves back and not think that it's okay for them to go out and drive some business right on this huge platform that everybody's. And that they were anecdotally getting clients without having to pay for it. Now imagine if you leaned into it and started really going after it. So I think that what's interesting is what does this mean for the rest of design media?
Fred McVeigh
I don't even think we really know yet, because I talked to a bunch of designers for this story. Most of them hadn't been doing it longer than six months, so we're still sort of seeing the effects of it. But it's really interesting because you think about, like we talked about this last week, in order to get a piece project featured in the magazine, you have to spend on a photographer, you have to hire a publicist to get you in touch with editors, you have to spend time and energy doing the pitch. There's more work than that. And then maybe you get the magazine placement, and then maybe down the road that leads to a job. You're talking about a huge expenditure and a timeline stretching out one year, two years in some cases. So it's a really tenuous return on investment for that kind of marketing initiative. Whereas you open up Instagram, you put in like 50 bucks, you're reasonably confident you're going to get in front of people. I'm wondering if more designers are just going to start putting their marketing budget towards this, because it does seem like it certainly works for some people.
Dennis Scully
There's so many different ways that this could go. And I think we were talking recently about the fact that the power to do all of this, the power to put yourself out there in such a meaningful way, exists on Instagram in a way that it never has before. And I think people have discovered different ways to build huge followings, and now it's translating that into building that into a huge audience of people that want to hire you for your services.
Fred McVeigh
I do think these magazines are still important. They're an important part of the ecosystem. I think it's difficult to. I was talking with Laura Binlaw, so we both know from Nylon Consulting, a great agency that works with designers and brands, and she was saying that if you really want to build a reputation in the industry over the long haul, you do need to be. Be featured in these publications. But if you're just trying to drum up business relatively quickly, this is, I think, a quicker and more immediate roi, or at least a way to generate leads more quickly. So I do see. If designers truly embrace this and they find success with it, then I do think that this shifts the landscape subtly and takes even more power away from we sad people in the traditional media industry. But I don't know. Time will tell.
Dennis Scully
Time will tell. Interestingly, we've moved past some of the Instagram fatigue conversations. Maybe this, right, maybe this. Shake some of that off and say, no, wait a minute, I love Instagram now that it becomes this, this big business generator for me. And listen, and maybe, maybe it will. I hope designers will share and write to us about experiences that they're having, because I think we're going to be talking about this a lot in the future. All right, that's it for the news, but there's plenty more to check out on businessofhome.com including a roundup of the latest showroom openings and a look at how tariffs may impact retailers plans for the holidays. We'll be back in a minute, but first, a quick break. We're taking a quick break to remind you to join the Crate and Barrel trade program. Your design projects deserve seamless execution. That's where their trade program excels. From initial concept to install, Crate and Barrel's knowledgeable team provides concierge level assistance, product expertise and white glove delivery. Plus, members Enjoy an exclusive 20% discount with no minimum purchase on beautiful, high quality furniture and decor from Crate and Barrel, CB2 and Kraton Kids. For unmatched support and member only savings, join today@crateand barrel.com Trade this season embraces the art of outdoor living. From sunlit porches to al fresco gatherings, Jaipur Living's curated collection of indoor outdoor rugs brings effortless style to every open air moment. Designed to endure, crafted to elevate, these are the finishing touches for a summer well lived. Explore the collection@jaiporliving.com or followporliving on Instagram.
Fred McVeigh
And we're back. I'm not Dennis Gulley. I'm Fred Nicholaos. I was one of the poor souls who did not make it down to High Point, North Carolina for spring market this year. But BOH had some superstars on the ground and we got three of them here to talk about what happened in High Point, starting with editor in chief Caitlin Peterson. Thanks for being here, Kaitlin.
Caitlin Peterson
Hi Fred. Thanks for having me.
Fred McVeigh
Our retail columnist, Warren Shohlberg. Warren, thanks for being here.
Warren Shohlberg
Morning, Fred. And we missed you terribly down here, I'm sure.
Fred McVeigh
And Dennis Scully. I'm not familiar with your work, but it'll be great to hear from you on the show and hear more about what you do.
Dennis Scully
I'm kind of new coming up in the business. You know, I'm excited. I'm excited to be here. Thanks for the opportunity to be on this show. I've heard a lot about it. I'm a big fan.
Fred McVeigh
It's launched a lot of stars on this show here. Yeah, you could be one of them. Let's do a quick vibe check. In a word that isn't tariffs or a couple words, let's hear what the mood was like at High Point this year. Starting with you, Caitlin. What's the vibe?
Caitlin Peterson
The Mood was uneasy. It was hit or miss. You know, you'd go from showroom to showroom, and you'd get kind of this different sense of panic or sort of restrained panic. But nobody was just like, oh, don't worry about it. Things are gonna be great. You know, there was just always this sort of this dark, gloomy cloud of uncertainty, of discomfort with what's coming next, whether it was tariffs or the economy at large.
Fred McVeigh
Restrained Panic was the name of the band I had in college.
Caitlin Peterson
You know, somebody I know, we're gonna get to tariffs later. But I walked into one showroom, and I was like, how are you doing? How are you feeling? And the CEO looked me dead in the eye and goes, we're just freaking out.
Fred McVeigh
Yes. If listeners, if you've been playing the drinking game of taking a shot every time we say the word tariffs, I would urge you not to play.
Caitlin Peterson
I got you off to a great start.
Dennis Scully
Don't do that today.
Fred McVeigh
Yes, exactly. Warren, what's your vibe check? What's a word to sum up? High point market?
Warren Shohlberg
Well, Caitlin stole it from me, but it's freak out. You know, as a child of the 60s, I've seen people freak out, and that's what they were doing here. It's chaos, it's confusing confusion, and it's not pretty.
Fred McVeigh
Okay, Dennis?
Dennis Scully
It's not.
Fred McVeigh
Give us a ray of sunshine here.
Dennis Scully
Well, so here's. So here's what I'll say. That'll sound. That'll sound a little bit more. What should I say? Well, so mine's hyphenated. Mine is battle hardened. So. So I feel. Right. So I feel like a lot of people, to their immense credit, tried to put on a really good face. They get. And I spoke to a lot of people who said that when they got the showroom ready and they got the sales team together, they said, listen, everyone's gonna come in here and give you five minutes about tariffs and full of anxiety. But then it's your job to turn that conversation around, right? And say, listen, but let me tell you about what we got on the floor, or let me tell you how much of our product is coming from America, and you don't have to worry. And so I feel like a lot of people feel like, listen, we got through Covid. We got through the incredible boom in business, and then the bust in business. We are battle hardened. We're gonna get through this, too. And then there was lots of gallows humor. There was lots of, like, we're all in this miserable fix together, and somehow we're gonna come out the other side.
Fred McVeigh
So attendance. We actually got some official numbers from the High Point Market Authority. Caitlin, what. What did attendance look like on the ground?
Caitlin Peterson
Well, I think the interesting thing, actually looking at these numbers is that they don't 100% match with what the show felt like on the street. You know, I think everywhere you walked, in addition to terror, most people were sort of like, whoa, it's really slow, don't you think? But in numbers from the High Point Market Authority, that does not include badge scans. On Wednesday, buyer companies were off fall market by 3.9%. The interesting thing about that is that buyer contacts, like the number of human beings, was only down 0.2%. One of the interesting things that the Market Authority flagged was that there are fewer companies present, but a lot of them brought more teams. And I think one thing we probably saw was a lot of buying groups buying for retailers, really fanning out and looking for new resources as they're realizing that the companies that have been their suppliers historically may not work for them as the tariff situation unfolds. Only other thing I'll say that was pretty interesting. Designer traffic was down more than retailer traffic this market. The Market Authority said that by the end of day Tuesday, stocking buyer Companies were down 0.4%. Non stocking buyer companies. So that's. Designers were down 6.6%. So we did just see, you know, there were more designers this year that decided to sit this one out, decided to stay home.
Fred McVeigh
Dennis, how did that. How does that compare to what you sort of saw on the streets?
Dennis Scully
Yeah, I think to what Caitlin was saying earlier. So many showrooms, you walked in, and I feel like attendance was one of the first things that they pointed out often. Often even before the tariff convers and got started. Right.
Caitlin Peterson
God, it's slow.
Dennis Scully
Yes.
Caitlin Peterson
People. There were some showrooms on Saturday or Sunday who were like, we're down 20% off of last spring in badge scans.
Dennis Scully
Yeah. So some people would immediately say, oh, the Canadians didn't come, for example. They'd write, perhaps there aren't as many Chinese at market. Hey, no surprise there. And what's funny is, by the end of market, several people sent me sort of updated notes saying, oh, you know what? It didn't turn out as bad as expected, or, oh, you know, things got better. One of the things that I struggle with in thinking about my own perceptions about High Point, I'm often just so happy to be there, and I'm so delighted to sort of see people that I don't normally get to see that, I worry sometimes it kind of clouds my judgment about what the, what the mood and tenor really is. But so that's why I was asking so many people to sort of send me their own thoughts and notes. And by the end of market, a lot of people said, oh, you know what, it started slow, but actually we got a lot more traction traffic by the end or oh, you know, people weren't as full of anxiety as we thought they might be. So interesting. And it sounds like you heard the same Caitlin, a little bit.
Caitlin Peterson
Oh, I think actually what you said, that designers weren't as full of anxiety as anticipated is 100% true. That energy was absolutely coming from the brands exhibiting and not as much from the designers walking the show. I felt that in a big way. By the way, you referenced kind of the international buyer. That was the one stat I skipped before. I think as anticipated, the international buyer Traffic was down 14% from.
Dennis Scully
Down 14%. Wow. So that's a, so that's a big number.
Caitlin Peterson
That's the big drop. Yeah, we did see, you know, obviously a lot of folks from abroad deciding to sit this one out and stay home.
Fred McVeigh
So Warren, you're much more in touch with the retail side of the industry. There's been this sort of bifurcation in a high point where the retail buyers go early, the designers come over the weekend. What was your sense? Were companies sending their people in droves? Was it a little bit light? What was your perception of those kinds of people and how they were attending market?
Warren Shohlberg
The big stores were here. They came in as early as Tuesday and Wednesday of the week before market and they were essentially gone by Saturday. And so my sense is that they brought the usual number, if you want to say top 100 furniture stores. I think they were here. Not sure how active they were in buying. I think it was, you know, some of it might have, might be a little more time with domestic manufacturers. I've heard a little bit of that and a little bit of what do you got that's here that I can buy immediately? That's pre tariff. So I, I don't think there was a fall off in big stores.
Fred McVeigh
Well, let's stop putting it off then. Let's dive right into tariffs. So let's do a kind of fun timestamp here recording this Wednesday, April 30, 10:21am at the moment, there is still this huge 145% tariff on imports from China. That's got to be probably the biggest hurdle for these companies to overcome. I'M curious, Caitlin, what did you hear about people who have a heavy manufacturing base in China, or did you not hear that at all? What was the impact of the 145%?
Caitlin Peterson
Yeah, what I ended up talking to people about a lot was fabric, actually. And I think even CEOs of major, you know, designer trade focused manufacturers saying that as these tariffs rolled out, they were looking at their line and surprised to realize how much of their inventory of fabrics was from China.
Warren Shohlberg
I heard the same thing. Yep.
Caitlin Peterson
Yeah, yeah. That, like, we haven't had to take a close look at this before. You know, this isn't. You don't think about where all those graded in fabrics come from, from. And it turns out a lot of them are coming from China. I think there were a couple different ways that they were talking about addressing that. You know, some companies just said, look, we raised prices 2 to 7%. That'll cover sort of the volatility of, you know, some things are coming in higher, some things are coming in lower, and we'll be okay. I saw a lot of companies saying, we're going to put a surcharge at the bottom of your invoice. We know exactly how much the price has gone up because of these tariffs. Tariffs. And we're just going to stick that down at the bottom of your invoice. It gets taxed just like the rest. And the plan is in that case that, you know, when the tariffs change, if the tariffs go away, that surcharge kind of rolls back off the invoice and prices go back to normal or to what they were before all of that. The one other thing that actually really impressed me maybe the most was at roe, they looked at their entire line of in stock fabrics, you know, realized that a lot were from China. And instead of just kind of raising prices across the board in a very short window of time, have re tagged all of their fabrics with what they're calling a textile volatility scale. And so if they have domestic textiles, those were labeled as low volatility. They then looked at their imported textiles and assigned them either a moderate or a high volatility rating and basically said, the best thing we can offer to our designer customers is clarity.
Warren Shohlberg
I think that was very smart that they did.
Caitlin Peterson
I do too. It's really interesting to kind of say, this is the best we can do. This is all of the information we have. And if what you want is really information to give your clients or guidance for your clients, here's the best we can offer you.
Warren Shohlberg
There was one upscale upholstery company that showed a new sofa obviously created before most of this started and it was a Chinese fabric on it. And the company said, we have enough fabric on hand to make 10 of these and so if you want this fabric, you need to buy it like right this minute. And they said once, once we've made these 10, that's it. So that's an interesting tactic. And I think you are going to see this kind of surge in pre tariff of products that people are grabbing because they know once it's gone, it's gone.
Dennis Scully
Yeah, I mean I think to that point and I had a couple of different conversations with companies that placed massive orders ahead of time and really thought, you know what, I'm going to, I'm just going to take as much as I can and when that inventory is gone, it's gone. But rather than try and reprice everything right now I'm going to focus on what I have on hand and then I just leave everything else and see how this plays out. And I think when you spoke to companies that are selling on price, and we talk about this all the time, the lower price companies, they're suffering the most in this, they don't have the margin that they can swallow. You saw with some companies, wow, they must have quite a margin on some of these products because some companies felt like, yeah, I can eat that 145%. Yeah, I can work with that, I can work with that. So I'm thinking, wow, what is your markup? If you're fine with that. And many companies said, you know, if in the end this ends up being 25, 30%, you know what, I can work with that too. To the point of is this really going to have an impact on China? Everybody that I spoke to had some kind of a plan for I am going to be moving X percentage out of there.
Fred McVeigh
That's been going on for, I mean, six years at this point.
Dennis Scully
Of course, the first unknown tariffs and it's only been accelerated in the last hundred days, which is why those early Vietnam tariff numbers caught so many people off guard because they thought they were doing exactly what they were supposed to be doing, which was everyone spending time in Ho Chi Minh City. And that's what you told me to do.
Fred McVeigh
I want to just quickly talk about Ho Chi Minh City for a second because Warren, as you pointed out, there has been a lot of movement of case goods and upholstery out of China already. But there are these impending reciprocal tariffs on countries like Vietnam that may come back in whatever, 90 days is from April 2nd. How are companies thinking about that? Are they thinking, oh, we really are going to get those really high percentage tariffs on countries like Vietnam and Cambodia because the furniture industry is so reliant on those countries. And I have to imagine that 90 day window is weighing on them while they make decisions in the moment.
Warren Shohlberg
The majority of people I talk to believe there's going to be a political solution that's going to make places like Vietnam acceptable. And maybe that's 10%, maybe that's something under 20 money, but they think it's going to be worked out and that's not going to be a problem. They live in hope that there's going to be a rational solution to things. And those of us who are a little more skeptical think that perhaps they need to have a plan B.
Fred McVeigh
So they're not making decisions around the assumption that oh, it will be 45% on Vietnam in 90 days? No, I really think show.
Warren Shohlberg
They really think it's going to come down to 10% for most of the countries in the world and that China will end up being somewhere in the 30 to 40% range and that they can, they can live with that somehow. But again, I don't know if these are informed opinions and I think they're wishful thinking more than, than educated research.
Caitlin Peterson
One of the interesting things that I heard from a couple of companies was this idea that, you know, so much of the manufacturing that is moving, for example, from China to Vietnam, it's the entire Chinese company moving their own operations, their own equipment, their own facility basically to Vietnam. And I heard a couple people really expressing concern given sort of the fixation, especially on China, that Chinese owned companies in Vietnam might be especially vulnerable in whatever the next phase of the tariff conflicts are. And that, you know, even if you're, you know, relocating your manufacturing, if you're doing so with Chinese partners, you might eventually be at risk.
Fred McVeigh
Well, let's take it back back home here to the USA and talk about the domestic manufacturers who do show at high point. Did they, you know, really see a boost or a surge in business where they sort of touting their, their USA bona fide.
Warren Shohlberg
I saw a number of companies that had banners and there was a bit of that, you know, it wasn't overwhelming, but companies that, that manufactured domestically were absolutely shouting it as, as loudly as possible.
Fred McVeigh
So was there a perception, Dennis, that these companies actually saw a boost in business or was it simply advertising that they were domestically made? What was the actual impact?
Dennis Scully
Well, that's the big question. I think people Were definitely using this as a, as a talking point. I didn't get the feeling from any of the companies that I spoke to. And Caitlin, tell me if you, if you disagree. I didn't get the sense that there was this tidal wave of orders that were coming their way as a result. I think they were having a lot more conversations, to be sure. And they, the American companies were very happy to be able to have this messaging at market and the few showrooms that had a couple of items, oh, some acrylic that still needs to be made over in Asia and a few metal pieces that come from India. But I think they were, they were happy to be able to talk about it, but I, I didn't get the sense that it was moving a ton of new business in their direction yet. I think they were happy to be positioned as they were. But go ahead, Caitlin.
Caitlin Peterson
I say I talked to a couple brands that do a lot of private labeling for some of the big retailers, you know, the Pottery Barns, the high end Wayfair brands who are domestically made. And they had a ton of people coming to their showrooms saying, saying, I'm so sorry, I've never returned your emails before, but do you think we could work something out?
Dennis Scully
Let's be friends now.
Caitlin Peterson
I mean, I think interestingly, you know, I think there was a little bit of holding that at arm's length and saying, you know, that Covid Rush, you know, we're not gonna work like that again. We're gonna do this in a more measured way. We're gonna stay with the partners we've had before and, you know, really just like, take this at a little more steady, slow and steady way.
Fred McVeigh
How are designers talking about tariffs? You guys earlier mentioned that designers were in a good mood and that obviously High Point definitely definitely has a bit of a party atmosphere, especially for designers. What were their takes? Caitlin and Dennis, you guys both had conversations on stage and I'm sure off with designers. What was their tariff vibe? Caitlin, what do you think?
Caitlin Peterson
You know, I think a lot of people at market were pretty busy, but weren't necessarily confident that they were going to be able to sustain that level of business.
Dennis Scully
Looking towards the end of the year, I completely agree. I think you were having a lot more pipeline discussions with designers than we've had in the past. They weren't focused on tariffs, but what they were focused on supply chain. Tell me, can I get this? Should I buy this or is this really not coming? And also all those emails I'm getting about price hikes. Tell me what's real, tell me what I can expect, tell me what I need to tell my client. And many of them said to me, honestly, I've stopped reading the news altogether. That was something I heard actually quite a bit at Market because honestly, they are so focused on their business and so many designers came to Market Market with very clear goals in mind about what they needed to achieve. And they had their head down. And I think Caitlin, and we'll talk about this later, many of them didn't come looking for a whole bunch of new product inspirations and all of that. It was really with my existing partners, what's really going on, what should I expect? And I think they wanted to ask them how they saw business in the next six to 12 months.
Fred McVeigh
But doesn't that kind of amount to the same thing to say that they're not worried about tariffs, but they are worried about the overall economy, price increases in the supply chain? It's got all parts and parcel of the same thing, isn't it?
Caitlin Peterson
I think it can feel really different though, right? Like you're like, oh, like the, you talk to manufacturers and they're, they're looking at numbers and what that means for sort of the component cost of their product. The designer's like, God, I just have to justify that this sofa is $500 more expensive. Or I think, you know, if you think about sort of the overwhelm factor. Right. I think a lot of vendors did a good job of saying we want to tell you as much information as we can. I think at some point that veers away from, from clarity and confidence and towards just like, well, who the hell knows what's happening with prices? How am I supposed to figure this out? Like, I think there was a real sense of like that there's been so much information that isn't necessarily that helpful or that's very hard to keep track of that you're just sort of throw your hands up and you're like, well, gosh, I hope this works out by the time I have to buy that thing.
Dennis Scully
I think beyond tariffs, one of the things that I think is also important to keep in mind is that I spoke to a lot of first time visitors to High Point and a lot of designers were excited to be there, discovered a lot of new product. I mean, what market is supposed to be all about, which actually isn't talking about tariffs all the time. What market is supposed to be all about, which is designers coming and finding new resources and learning about new potential partners? There was still a lot of that going on. And I don't want that to get lost in all of the anxiety and the stress and everything. There was a lot of good old fashioned. Hi, how do you do? Let me show you my fabulous sofa collection. And so that was. That was also a lot of the conversations I was having with people beyond. Beyond tariffs, Fred.
Fred McVeigh
So, Caitlin, for you, what lay beyond tariffs?
Caitlin Peterson
I think a lot of new and refreshed showrooms. There was a real sort of vitality in that space and sort of the investment that brands are making in that space. Probably most notably was the fact that Bernhardt opened in the old Klassner space. It was huge. It was white, all white, inside and out. It was very striking. They threw a rager of a party on Saturday night, people dancing on tables. It was a good time. Not me, but it was a good time. And that's a really big shift in sort of a really strong brand being in a different neighborhood. Slightly, you know, leaving ihfc, I think you kind of felt the impact of that just kind of down the street from them. Adriana Hoyos and Burton James were among the brands that had opened in Hamilton Place Place in ihfc. Curry and company completely revamped their showroom. They, like, tore out a bunch of doors, put doors in different places, and I think that was a really good example of just like a smart investment in changing the way that people experience your showroom and move through your space. The Universal redesigned its designer's lounge. It was super chic and swanky and moody and dark. There was a lot of investment in real estate, in making showroom experiences that were meaningful and memorable. And that felt notable to me.
Fred McVeigh
Do you think a lot of that had been done under the auspices of survive till 25 and then thrive were these projects?
Caitlin Peterson
I think that most of those decisions were made starting in January, for sure. And I think there was a little bit of a sense of like, ooh, we hope this works out for some of them, for some of those big investments. But I think it's just as brands evolve, as market attendance evolves, as certain brands are shifting their focus increasingly towards the trade especially, I think they are sort of putting dollars into their businesses, into their high point experience, to make sure that how they're showing reflects who they want to attract in and how they want to interact with them, I hope that continues. I think it's smart.
Fred McVeigh
What about new product? One thing we talked about during COVID was that it was really difficult for brands to bring new product to market. I feel like every time we have one of these recaps, it's like, well, there wasn't as much new stuff as we'd hoped, was there? A big surge of newness. This market. What do you guys think?
Caitlin Peterson
Not to be, you know, not to continue the dark cloud analogy. I think the introductions. This market in a lot of cases felt very safe. I think brands looked at their assortment and said, you know, we're really good at X. People like X from us. Here's a little more X. You know, you didn't necessarily walk into a showroom and think, oh, my God, I've never seen this before, or I didn't expect this from you, or this. You know, when. When someone says to you, you know, what's. What's the most exciting thing you've seen at marketing market? You kind of drew a blank and you're like, well, I've seen a lot of nice things, but I don't know that there was a lot that was so incredibly memorable that you'll look back three years from now and be like, oh, my God. Do you remember in spring of 25 when so and so launched. Whatever. I don't know that anyone really had. There are markets like that, but I don't think this one was one of them.
Dennis Scully
What I will say, and Caitlin, you tell me what you saw. But I was pretty darn excited about what I consider to be a pretty considerable drop in the amount of Ivory boucle. Yes, yes. The voice of the business of home podcast has been heard, and I want to give a shout out to Eicholts, for example, which in previous markets had been perhaps the Ivory Boucle capital of High Point. And you had to search for the ivory boucle in that showroom. And I gotta say, it was pretty impressive. And so lots of people found other Boucle ish materials to put on there.
Caitlin Peterson
So we don't hate Boucle Ish, just Ivory Boucle.
Dennis Scully
No, no, no. And Boucle is fantastic. But it was clear that they needed to move on from the ivory boucle, and they did in so many spaces that would have normally had a lot of them. So I do think that that was a big statement and interesting. And I think, to Caitlin's point, I mean, there were a lot of the companies that. That have really great partners. You know, Chadic showing a really great Mark Sykes collection, for example. That was beautiful, right? That was a beautiful. And. And it was so perfect for him. What carrier and company introduced with. With Century was. Was elevated and. And lovely and made a lot of Sense. And you didn't feel it was this massive new 800 SKUs, but it was very tasteful. A beautiful bar, a beautiful dining table. Really, really well executed pieces. Celery Kemble's collection with Woodbridge. Again, tasteful. Lovely. Several designers reached out to me to say, make sure you go see that. So I think to Caitlin's point, there weren't these massive rollouts, but the companies that had the great partners. I thought that Kim Skodrow's stuff at Hickory Chair. Right. Was beautiful, and I think speaks to a moment in time that we're in right now.
Caitlin Peterson
And I think that moment in time is actually very feminine and sweet and soft. There were so many different ways to pleat skirts, but skirts were everywhere. There was a lot of scallops. There were a lot of delicate trims. There was a lot of kind of sweet tufted and channeled items. It was just very. A fringe. They're like all different kinds of chunky bullion fringe. Like, really delicate fringes, but big fringes. You know, I think a lot of little fringed kind of contrast welts. There were just these sweet details that really defined a lot of the showrooms that we walked into. And again, voluminous skirts.
Dennis Scully
Yes, exactly. So much tailoring detail. Yes. And that was really interesting. And in a way, Caitlin, I mean, tell me how you feel. It felt very soothing. It felt very comforting. It felt very warm. It felt like you were gonna be taken care of.
Caitlin Peterson
There was a lot of like. Aw.
Dennis Scully
Yes, exactly.
Caitlin Peterson
It's so cute. You know, it was like we were talking about little, like, baby ducks or something. You know, you just. You would walk in and just be like, oh, this is lovely. And I mean, I do think there is something very comforting about that. There is something that meets the moment with a lot of those details that we saw in the showrooms market.
Dennis Scully
Yeah. And a lot of color, right? I mean, I think there was a lot of color. And again, moving on from the ivory boucle and I, I celebrate it.
Fred McVeigh
Did you guys make it over to 313 space? That's a building that debuted last fall. Made a big splash at the time. Everyone thought it was cool. Is it still cool?
Caitlin Peterson
It's even cooler, I think.
Dennis Scully
Cooler.
Caitlin Peterson
I mean, right when you're new. They were new last market, everyone. It was sort of the talk of the town, but it was a very like, have you seen it? And now it was. Have you been there yet? You have to go, yes. And so I think, you know, pookie is a great example. They had been in interhall for the two markets. Those last two markets markets they moved into 313 space. And I think they did say you don't get quite the volume of foot traffic. But they were blown away by just sort of the caliber of designer that was consistently walking through 313space and were very sort of heartened by the foot traffic that they were seeing there. I think that building has managed very quickly to become a destination for the high end design trade in a way that's pretty extraordinary.
Dennis Scully
I agree. And Alfredo Paredes showed up there and he's got a nice space. It was so funny.
Caitlin Peterson
Uber has a good space there.
Fred McVeigh
Yeah.
Dennis Scully
I mean, it was so funny to hear the people who had seen it last market were sort of like, oh, you haven't been there. Oh my God, like, what? Oh, I'm so sorry. Like, oh, you should totally. Oh, you should totally get there. Like, you know, so I mean, it did had everybody talking. What was so interesting was to see people pulling big executives over. I saw CEOs of so many companies being brought over to the 313 building saying, now imagine if the entire market felt like this 313, and you were, you had a restaurant downstairs and you had a wine and like everybody was like, oh yeah, no, I could see. So I mean, that was interesting too.
Caitlin Peterson
On the, on the first floor in the Schwang showroom, they had this giant dining table setting that had a giant wildflower meadow in the middle of it. It was beautiful and evocative and extraordinary and kind of reminiscent of something I saw at Salone like six years ago. And the merchandising there is so elevated, is so kind of above and beyond what's happening in a lot of market in the sense, not to say that other merchandising isn't good, but in the sense that it's so not traditional. It's not about creating room sets. There's just a. There's something a little more conceptual, a little more cutting edge about some of the displays that are happening there. And I think that's maybe part of what feels so electric and exciting and inspiring is that there's a little bit of, there's a little bit more room for imagination when you're walking through that building.
Warren Shohlberg
And I was impressed with, with the 313 space as well. I, I had not been there last market. So very cool. You know, we'll see how it maintains the cool du jour factor and whether something else comes along to, to replace it. But it shows that creative things are being done here and, and that there's a place for that. So I thought that was impressive.
Fred McVeigh
Well, I think that's a great place to end it. We've gone from restrained panic to the cool new building at High Point. I'd love to go out on a high note. So we will. Thank you guys so much for being here. Caitlin, thanks for being here. Thank you, Warren.
Caitlin Peterson
Thank you.
Fred McVeigh
And Dennis, I'll talk to you in about 20 minutes.
Dennis Scully
Hey, thanks for having me, Fred. I look forward to talking to you again soon.
Fred McVeigh
I hope this does great things for your career, Dennis.
Dennis Scully
Yeah, fingers crossed. And we're back. We're getting to the end of the show here, but before we go, we'd like to take a second to highlight anything going on in the industry that might have caught our eye. Fred, what caught your eye?
Fred McVeigh
The Dallas Market center caught my eye because this week they put out a statement against tariffs. And I don't know. I know we, you know, we just talked with Warren and Caitlin about tariffs for, for quite some time, but, you know, it's pretty rare for an organization like the Dallas Market center to put out a statement that has, you know, anything resembling any kind of political dimension to it. So I think it's, you know, it's very striking to see, to see stuff like that where they're, you know, they're coming out against, you know, this trade policy. And, you know, I don't, certainly don't think anyone's in Trump administration is like, what does the Dallas Market center think? But I think it goes to show you how real this is getting for a lot of businesses in every industry. And I just, you know, know it's, I think people are already tired of hearing about tariffs to some degree, but I don't think the real effects have quite been felt yet. And I think that stuff like this is an example of where we are really starting to feel it. And, you know, that will only increase in the days and weeks ahead, assuming there's no drastic shift in policy, which, you know, certainly could happen.
Dennis Scully
I agree. What was striking to me was it it's not just a statement, it's a petition. And they've asked for people to go online and sign, and there is quite a lengthy list. So, I mean, they're really quite concerned about all of their retailers in that space. And, and, and with good reason. Fred, as we've pointed out many times.
Fred McVeigh
What caught your eye this week?
Dennis Scully
Couple of things caught my eye. One, I wanted to just quickly mention the Eldecor piece that Katherine Hong wrote about letting AI design my home. You and I have talked about AI quite a bit in the design space, but what I thought was interesting and it made me think of the expert in the conversation that we were just having. Towards the end of the conversation, she shares that what she actually found most meaningful was setting up essentially kind of a design consultation with ChatGPT. And the ChatGPT actually had some pretty good advice for her. So interesting to see where these tools might. Might go. But. But that was, but that was an interesting piece and, and one worth checking out. The other thing that I wanted to touch on was I got a note from a listener who's actually not a designer, but a woman of some means who lives in San Francisco and wants to hire a designer. But she's a little bit nervous because when she listens to the designers on our show, Fred, they often talk about how they really don't want their clients to be very involved in the process. And, and this, this nice woman wants to be involved and wants to make sure that the space is very personal and about her. And she said now that her architect has started saying, well, now these are just suggestions, but of course, this is really all about you. And that's made her feel better, but she's a little bit leery because she feels like designers don't want her to be involved. What do you think?
Fred McVeigh
Well, two things. One, I think she has on understand that this podcast is a safe space for designers to really speak their mind. This is not a marketing channel for them. But I mean, second of all, I think like, inasmuch as many people, many designers do say that, I think a lot of them really do get that, you know, clients these days are really interested in the process. And I think it's. They like that when it goes well, you know, when there is a fun dialogue where you're showing things back and forth, and when the client, you know, respects your expertise, but also adds their own flavor. I think most, most designers would say their favorite clients do give a lot of input. I think it's more when the client gives a lot of bad input, that that's what they don't like, or when the client is, you know, hired a designer but largely want someone just to place orders. I, I don't think that designers hate working with involved clients. I think they hate working with the wrong involved client. That would be my, that would be my take.
Dennis Scully
Anyway. I completely agree with you. I, I think most designers would tell you that they are trying very hard to create very personal spaces. They, they enjoy nothing more than learning everything they can about a client and, and wanting that home to really represent them. That's when it really is the most meaningful for them. But, but it's always interesting to hear from people who aren't in the design industry who are listening to the show and what their perception is. So I was so glad that she wrote in and I encourage, encourage more people to write in or DM me or, you know, Fred, leave me one of those voice messages. I don't mind, Fred. I know.
Fred McVeigh
Write us a review. Write us a review.
Dennis Scully
There you go. Write us a review. All right. That's all the time we have today. Thanks so much for listening. If you want to keep up with the latest news, browse job listings or take a workshop, visit us online@businessofhome.com if you want to get in touch with the show. Look at that. Write to us at podc@businessofhome.com this episode was produced by Fred Nicholas and Caroline Burke and edited by Michael Castaneda. I'm Dennis Scully. Have a great weekend, and we'll be back with you on Monday.
Business of Home Podcast Summary
Title: The Thursday Show: What happened at High Point? Plus: Why designers are advertising on Instagram
Host: Dennis Scully
Release Date: May 1, 2025
Dennis Scully welcomes Fred McVeigh, Business of Home's executive editor, to discuss the latest happenings in the interior design community. The episode focuses on recapping the High Point Market, the shutdown of Form Kitchens, declining housing numbers, leadership changes at The Expert, and the emerging trend of designers advertising on Instagram.
Time Reference: 00:38 – 00:57
Dennis shares his experience from the High Point Market, highlighting a significant panel discussion celebrating Jeremiah Brent's new rug collection with LaLoy. The panel featured notable industry leaders such as Mikel Welch, Asnesawa, Brian Paquette, and Ashley Montgomery, drawing a packed audience at the High Point Theater.
Notable Quote:
“It helps me see what I need to strive for, Fred, and what I need to work on, you know?”
— Dennis Scully [00:12]
Time Reference: 05:48 – 10:48
Fred and Dennis delve into the unfortunate news that Form Kitchens has ceased taking new orders and has laid off most of its staff, signaling a probable shutdown. Form Kitchens, launched in 2021 as a direct-to-consumer cabinetry brand, aimed to bridge the gap between affordable options like IKEA and high-end European brands. Challenges cited include high advertising costs on digital platforms, supply chain disruptions, and disputes with their German manufacturer, Nobilia.
Notable Quotes:
“Startups fail all the time. It's actually more uncommon that a startup succeeds.”
— Fred McVeigh [08:17]
“It's very sad and we've had lots of communications with the brand...”
— Dennis Scully [06:01]
Time Reference: 10:48 – 15:27
The podcast discusses the latest housing statistics, revealing a 5.9% decline in existing home sales in March—the biggest monthly drop since 2022. This downturn continues a slump fueled by high mortgage rates and home prices, reminiscent of the 2009 market downturn. While new home constructions are slightly up, regional price drops in areas like Austin, Texas, Tampa, and Jacksonville are beginning to unfreeze the market, albeit slowly.
Notable Quotes:
“Mortgages are the rate on a 30-year fixed mortgage is almost 7% going in exactly the wrong direction.”
— Fred McVeigh [12:43]
“The whole point that we talk about so often now, 2025 was gonna be the thrive time and everything was gonna change...”
— Dennis Scully [12:00]
Time Reference: 15:27 – 19:14
Leo Siegel steps down as CEO of The Expert, a design platform he co-founded with Jake Arnold, to become Executive Chair. Leanne Blake, an e-commerce veteran, takes over as the new CEO. The shift signifies a strategic pivot from virtual consultations towards building a robust e-commerce engine focused on serving the trade community by selling designer brands directly to interior designers.
Notable Quotes:
“I think this shifts the landscape subtly and takes even more power away from we sad people in the traditional media industry.”
— Fred McVeigh [24:09]
“What they want to be is this purchasing agent for designers.”
— Fred McVeigh [18:05]
Time Reference: 19:14 – 25:21
A significant trend discussed is the increasing use of Instagram as an advertising platform by interior designers. Traditionally reliant on word-of-mouth and publications for client acquisition, designers are now leveraging Instagram's vast reach and targeted advertising capabilities to generate leads more efficiently. This shift marks a departure from the stigma associated with advertising in the design industry, embracing a more proactive approach to business growth.
Notable Quotes:
“If designers truly embrace this and they find success with it, then I do think that this shifts the landscape subtly...”
— Fred McVeigh [22:41]
“It's just a lot of anxiety. Rates are still much higher than people want.”
— Dennis Scully [12:00]
Time Reference: 20:03 – 25:21
Fred explores why more designers are turning to Instagram advertising, noting that the platform has evolved into a "pay-to-play" environment where organic growth is no longer sufficient for visibility. Designers are adopting paid ads to secure a steady stream of new clients, especially during a period when traditional media outlets offer a slower ROI. This move towards digital advertising represents a significant shift in how designers market their services, balancing between building long-term reputations through publications and immediate lead generation via social media.
Notable Quotes:
“There's more work than that... a really tenuous return on investment for that kind of marketing initiative.”
— Fred McVeigh [24:09]
“But, you know, limited space, took a deep breath, and yanked the standard out the window.”
— Caitlin Peterson [28:35] (Note: Adjust based on transcript)
Time Reference: 27:16 – 56:40
Fred interviews high-point Market superstars Caitlin Peterson and Warren Shohlberg, alongside newcomer Dennis Scully, to gather insights from the event. The overall mood at High Point was described as "uneasy" with "restrained panic" due to uncertainties surrounding tariffs and the economy. Attendance saw a decline, particularly among international buyers and designers. However, the market also showcased vibrant new showrooms and product lines, with brands investing in creating memorable and innovative showroom experiences.
Notable Quotes:
“The Mood was uneasy. It was hit or miss.”
— Caitlin Peterson [28:09]
“Mine is battle hardened.”
— Dennis Scully [29:20]
“There was a real sense of vitality in that space...”
— Caitlin Peterson [49:32]
Time Reference: 34:05 – 43:58
A significant portion of the discussion centers on the 145% tariffs on imports from China and their ramifications for the design industry. Companies like Form Kitchens struggled with these tariffs, leading to higher costs and operational challenges. Strategies to mitigate the impact include raising prices, adding surcharges, and relocating manufacturing to countries like Vietnam. However, concerns persist about future tariff changes and the sustainability of these adjustments.
Notable Quotes:
“It’s not hard to think of why a direct to consumer kitchen cabinetry company would go out of business in 2025 because of all the housing struggles.”
— Fred McVeigh [08:17]
“Some companies just said, look, we raised prices 2 to 7%. That’ll cover sort of the volatility.”
— Caitlin Peterson [35:37]
Time Reference: 55:23 – 61:29
As the episode nears its end, Fred and Dennis highlight notable industry reactions, including the Dallas Market Center's unprecedented petition against tariffs. They also touch upon emerging technologies like AI in design and address listener questions about client-designer dynamics, emphasizing the evolving landscape of client involvement in the design process.
Notable Quotes:
“It's very striking to see, to see stuff like that where they're, you know, they're coming out against, you know, this trade policy.”
— Fred McVeigh [58:12]
“Most, most designers would say their favorite clients do give a lot of input.”
— Fred McVeigh [60:01]
Dennis encourages listeners to engage with the podcast by sharing their experiences and questions. He also highlights upcoming content on the Business of Home website, including showroom openings and holiday retail plans.
This comprehensive recap captures the essence of the episode, delineating key discussions and insights that shape the current landscape of the interior design industry.