Here in Part 6 of the Hellman-Chang story we wrap up their history. When the recession began a few years ago, Dan and Eric were running a fledgling firm out of a co-op; they not only weathered the storm but grew through it, emerging with a nationwide showroom presence, a global client base of high-end clients and their own production facility, which they're currently planning to double in size.
In the next and final entry we'll look at Hellman-Chang's design work and company philosophy, but before we can get there we'll see the final steps Dan and Eric needed to take to get to where they are today.
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So it's 2008, you're now in the A. Rudin showrooms, and sales are starting to pick up. Dan: Orders started coming in from all around the country. We started to grow tremendously.
What types of customers were you getting? Eric: Once you're in the showrooms we were in, you're set in a position where it's high end residential and high end hospitality. Our first order at the New York showroom was from the Rockwell Group for the Setai Hotel, the new one out in San Diego.
Dan: The Rockwell Group is known as the pinnacle of interior design/architecture firms, they do a lot of boutique hotels.
Eric: And they designed the Oscars, you know? So the Rockwell Group being the first Hellman-Chang client at the showroom was like, "Whoa, that's great."
Dan: It was really good for building that credibility with A. Rudin, and they were very happy with us from early on.
Got it. And what else starts happening for you guys in 2008? Eric: Because we were doing so well the showroom requested we expand our presence, so we did a refresh. At our second ICFF we introduced some new pieces and did a new booklet, going from 32 pages to 64 pages, so we had about double the size of our line.
Dan: The sales were going well enough that we hired three full-time furniture builders and made more product. After the ICFF that year—where we got more press—and the showrooms' request for more furniture for the showroom floor, we roughly doubled our presence in size, going from eight pieces to maybe fifteen or twenty.
So that expansion you guys had hungered for upon first seeing the showrooms was starting to happen. Eric: Right. We were starting to expand within the showrooms, to eventually move up to being their number two line by the end of the year.
I imagine at this point you guys are no longer producing everything from a 5x10 spot in the co-op? Dan: We were still in the co-op but had expanded.
Eric: In the co-op there was initially ten or twelve artisans and craftsman, of which we were one small unit. And as people would leave, we would take their space. Then somebody else would leave and we'd scoop up their space too. So we started out in 50 square feet, and by the time we were done there we had 1,000 square feet of bench space.
Given that your production was starting to ramp up, was that enough room? Eric: It was tough. We were all building together and taking phone calls at the same time from designers, so I'd be on the phone trying to quote prices and there would be a saw going off right next me. It wasn't the most professional environment.
Dan: We were on top of each other. We just kept on growing, and while we're on the phone or writing emails, routers are creating saw dust ten feet away. But we still didn't have the resources yet to start our own studio.
Eric: And we could tell the other tenants were getting really annoyed with us.
Dan: Yeah, we were hogging the machines.
Eric: We eventually decided to open up this studio that we're in now [Ed: The interview took place in Hellman-Chang's 8,000-square-foot facility, which will shortly double in size, more on that later] and that was very much based on needing to control our own space and have more room to be able to spread out. And we wanted to delineate the different spaces, office space, bench space, machine room space.
But before we could do that—back in 2008, despite us growing so much, that was also right when the market crashed. That was an...interesting experience. There was this sense of doom and gloom all over the industry, showroom salespeople were freaking out, interior designers were freaking out. And how did the crash affect you guys? Eric: That was our first year in the showrooms, so we had no previous years of sales to compare what the market was doing to us. And because we were so young we were still growing. Between 2008, 2009, 2010, our sales increased every year despite the economic downturn, just because we were still growing the company.
Dan: We kept our heads over water and in a weird way the crash actually helped us. When we opened this shop there were fire sales for a lot of high end equipment. A lot of the machinery you saw in the shop back there, we got at auction.
Eric: Furniture warehouses all over the New York area were liquidating their equipment. We were able to get some really good prices, like a $30,000 saw for eight grand. These tremendous discounts really helped in setting up our studio.
Dan: Of course, there was good and bad.
Eric: The bad part was that the society that we were in, making furniture in New York, everyone was really stressed out. We saw a lot of fellow cabinetmakers going out of business and everyone was really scared. Seeing a lot of our comrades go down was eye-opening for us. And it's always been important for us to try to support the local craft and the local trade. A big part of our company is being based in New York; all of our partners are within a three or four mile radius of us.
Dan: So we use a glass maker down the street, our finisher a couple of blocks away, an upholsterer right around the corner, our wood is supplied by someone in the Bronx.
Eric: We want to keep this New-York-centric, Brooklyn-centric business going. That's important for us as a company.
What sparked that? Earlier I'd mentioned I wanted to ask you about the Brooklyn vibe of the company. Eric: Because that's how we started working, in a co-op where we were shoulder-to-shoulder with these other guys. And seeing some of these companies go out of business was scary. Our company was growing so we felt we ought to help where we could [by hiring and sourcing locally].
Another good thing about keeping it local is that it affords a measure of quality control. Our close partners are right down the street. You can go down there and see what they're doing so it works out really well.
Dan: And by staying local it's almost like keeping it in the family, that kind of feel.
Nice. And this place that we're in right now, how long did it take to get it set up? It was about two months that we were building the flooring and division walls, setting the machinery up, building the space up.
I imagine that's a disruptive process for an ongoing business. Were you able to continue fulfilling orders at this time? Eric: We had prepared. We had caught up as much as we could on future orders--we sell with about a 12-week lead time, so we were addressing our orders as quickly as possible in preparation for having some down time. It worked out almost perfectly--it didn't go off without a hitch, of course, there were hiccups here and there.
Dan: But for the most part it was pretty smooth.
Right now we're sitting in the office, and through the interior windows we can see the shop area beyond. Are you guys still going back there, getting your hands dirty? Eric: Dan still goes back there with the guys a lot. He's a really good, hands-on manager.
Dan: I still do a lot with training any new employees, making sure they're building it the correct way, approaching the piece from the right methods. I have a hard time staring at a computer screen all day so I like getting up and moving around, helping out with glue-ups, assisting with pieces.
Eric: Dan's a really good manager and teacher, and he's got a lot of patience. And that goes a long way in a small company, especially a design-oriented one. And I think for the guys back there, to see your boss go back there, put a T-shirt on and do exactly what you're doing, right next to you, is very inspirational.
Dan: We never ask anybody to do anything we wouldn't do, haven't done or aren't going to do in the future.
Dan, you had mentioned that when you first started with those interns you had had no previous experience being somebody's boss, is that right? Dan: Correct.
It's one thing to be a furniture designer/builder and quite another to be managing people; the latter requires a totally different skillset. Was it just something you picked up as you went along? Dan: Yeah. My dad was actually great as a mentor. Eric was great too, having managed employees at his company. Anywhere I could get advice on how to manage, I did. But, really it just comes down to respect and treating people the way you'd like to be treated.
Then there's the other element to it: Since you guys started off making the pieces yourself, is it tough when you realize that you have to back away and let this other person put his or her hands on your furniture? Dan: Well, we try to have our hands on almost every piece at some stage in the production, and definitely our eyes, inspecting the pieces. It's a small enough company that we can control that, and we do trust our builders. They know what they're doing, and we're constantly working with them.
Eric: Since Dan oversees a lot of it back there, it's not uncommon for one of the guys to ask one of us "Hey, can you take a look at this" and we'll go back there and check something out. Dan and I still have a lot of our personal touch on every piece that goes out the door.
Okay. And in the timeline of Hellman-Chang's history, did we miss anything getting up to the present day? Eric: The David Sutherland showroom. We started off in 2008 with A. Rudin in the four cities, selling, growing, adding new pieces. In 2009, we met with David Sutherland.
Dan: David Sutherland is another showroom in the industry that's very top tier, also a top five showroom. They also understand a great deal about branding and luxury and carry a lot of cache with them within the interior design trade.
Dan: David Sutherland is another showroom in the industry that's very top tier, also a top five showroom. They also understand a great deal about branding and luxury and carry a lot of cache with them within the interior design trade.
Dan: They're based out of Dallas, Texas, and we had met a designer from Texas at the ICFF that we worked with. While visiting one of the projects in Texas, the designer got us a sit down meeting with David Sutherland himself.
How did that meeting go compared to the A. Rudin meeting? Eric: It was much different.
Dan: A. Rudin had been opening up a new showroom in New York looking for a furniture line. David Sutherland was not looking for a new furniture line. He just didn't have the space.
Eric: We were saying, "Hey, we want you to represent us," but he was already satisfied with what they had.
Dan: But about a year later there was a big convention in Chicago called NeoCon.
Eric: David Sutherland was there, and I popped into his showroom for an impromptu meeting. He wasn't expecting me, but we sat down and he remembered us and we talked a little bit about where we had gone since our last meeting. We'd had a lot of press since then and our company had grown a lot, and I think the timing was just right. I think some of lines that he was carrying were maybe making some changes, and he probably was in the mindset to look for something new. We had a great meeting and within a few months, we had a contract with David Sutherland.
Dan: By the end of last year we had all of our pieces in their showrooms in the Dallas, Houston and the Miami area. So that was another big milestone for us.
Does that bring us up to present day? Eric: That does, in terms of the sales front. On the design front, a lot of exciting things are happening....
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You've read the story of Hellman-Chang's rise, including the careful attention paid to branding and the thinking behind several crucial business decisions. Next we'll take a look at their actual work, see what the brand is all about and find out what Dan and Eric are currently working on.
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