PLATFORM

Come Rain Or Shine

by Marc Almagro
photos by Chino Sardea
10 Mar 2017

Lim Choon Hong, chief executive of Xtra Designs Pte Ltd, talks about weatherproofing his business

The new Xtra showroom at Marina Square puts the structure to good use. Singapore-based design studio Produce, headed by Pan Yi Cheng, has masterminded the transformation of the 13,000-square-foot commercial space.

An open plan ‘apartment’ is laid out in meticulous detail alongside full-height windows; the brands Magis, Moroso, Dedon, Foscarini, Tom Dixon, and others, still get their exclusive shop-in-shop spots, and the signature Herman Miller ‘cave’, an award-winning collaboration with a local designer, has taken on the feel of a soaring cathedral, no small thanks to the double volume of the section allocated to it.

 It is the same size, give or take, says Lim Choon Hong, but everything is spread out on one floor instead of the two levels that they previously occupied at the now defunct Park Mall. Kith, the group-owned restaurant-café is on one side of Herman Miller; Xtra Office and Xtra Designs are in another wing on the same floor.

The big move is timely for Xtra, as it can generate a buzz at a time when the retail sector in general has been showing signs of slowing down. The new showroom, the prospect of showcasing new products, and the events that can be worked around them are enough to keep everyone on the team upbeat. Meanwhile, the Salone del Mobile, which will take place in Milan in early April, is another possible source of sustained enthusiasm.

  • A STRONG START
  • GROWING BY MEASURE
  • WEATHERPROOF PLAN
  • SOLUTIONS, NOT PROBLEMS
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A Strong Start

Although Xtra has clearly delineated businesses – retail, contract, kitchens, and offices – it only had the first when it opened doors in 1989. Contract design projects occasionally turned up, but Choon Hong recalls his business to have been “everything lumped together” in those early days. There was absolutely no segregation of functions, “we operated like a jack-of-all-trades, and tried to make a sale in whatever way we could.”

 Trained as an architect, Choon Hong practiced in local private firms before joining a retail company that sold imported designer furniture, and where he quickly developed a knack for the business. Pooling his and his wife’s savings, he ventured to Milan to stock his first shop. “The money I had was just enough to buy a few pieces,” he recalls amusedly, “but a friend in fashion retail who knew that I was on a buying trip called to ask if I could buy some clothes racks for his business. That started it all; I was able to buy a few more pieces.”

 Retail has highly specific requirements, Choon Hong would discover, and they’re quite different from contract design. Most aspects of the former are oriented towards lifestyle, with customers looking for different things that represented their status, budget or personal tastes.

 On the other hand, contract is sensitive to lead time, budget, and integration of solutions. “Each area has specific requirements and demands on the business, as well as different approaches to problem-solving,” Choon Hong elaborates. “Contract thrives on the effort we put in, on being proactive in looking for business. We can make appointments with architects to offer what we have, but in retail, if customers don’t want to walk into the shop, there’s little you can do.”

Retail succeeds on effective blending of merchandise and brands, creating experiential environments around them, and looking after customers’ needs beyond points of sale.

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Growing by Measure

The company’s offices business was set up almost 20 years ago when Herman Miller approached Xtra to represent them. “It is a major brand so we needed to set up specialized operation.” Herman Miller has since proven to be a successful face for the office business, and even the entire operation. Its rich legacy and well-articulated philosophy resonate with the design-savvy, while its collection of reissued iconic pieces appeals to nearly everyone else.

In comparison, the kitchens business was established only a few years ago on the back of an opportunity to fit out a new development. Today, each business is managed separately, and Choon Hong’s role is to ensure that they all get the right support for growth.

“We focus on Singapore,” Choon Hong says of the company strategy. “That’s how we grew the business over the last twenty-seven years. I’m sure there are other opportunities developing overseas, but we are more interested in consolidating and improving our position here in this sector.”

Choon Hong admits that they are not “very ambitious with our growth plans”, keener on achieving a work-life balance for everyone instead. “In this market, or in any business for that matter, finding the right people is difficult. And when you do, you have to nurture them.” Xtra’s head count of about 80 places it between a small and a big operation.

A mostly local market base and a small group of foreigners who either live or own properties in Singapore support Xtra. The company has also identified a new target market among the young. “We recognize that their buying power is on the rise. We’re on social media to engage them. We’re also always on the lookout for products and brands with more competitive pricing.”

  • A STRONG START
  • GROWING BY MEASURE
  • WEATHERPROOF PLAN
  • SOLUTIONS, NOT PROBLEMS
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Weatherproof Plan

Having seen several expansions and contractions in the market prepares Xtra for the prospect of a slowdown. “We realize that each downturn is followed by an upturn,” Choon Hong says. “The challenge is sustaining our business as we wait for things to turn around and get better.” The company has been very prudent through the years, he claims. “I tell my fellow directors that we shouldn’t have dead stocks weighing us down, that we should keep our cost reasonably low, and that we should consolidate activities, such as shipping for the different businesses, to make them cost-effective.”

Having different portfolios, and therefore a good spread, also helps stabilize the business. If one part of it is not doing well, there are always others. “We didn’t plan it that way; it’s just how the business grew.”

 

Xtra keeps its target realistic by revising it according to how the market is expected to perform. “Fortunately, we’re still okay. We know that the slowdown will continue through 2017, but we hope it will pick up around 2018. We remain optimistic and do what we can to prepare for the eventual upturn.”

 

“Franchise sale can be very peculiar,” Choon Hong points out. “A few months can pass by quietly, and then one day someone will just walk into the store and buy (furniture) for an entire house.” Despite occasional dry spells, the retail team must ensure that the showroom is interesting, the products presented well, and customer service consistent. “There are still people buying, and they still have a job,” Choon Hong says.

  • A STRONG START
  • GROWING BY MEASURE
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Solutions, Not Problems

The company’s contract design business is doing well. “We’ve been fortunate that we’re able to supply to projects such as universities, airport, and hospitals. We remain active in the sector, despite the shrinkage, so it’s not as bad as some people think,” he reveals. Ninety per cent of Xtra’s contract design business is now focused in Singapore, although previously it did business in China and the Middle East.

“Our contract business is a ‘total solution’ provider. We can source for products from Asia to Europe; we can provide bespoke and custom furniture.” The company “respects the client’s budget” by delivering the best possible solution instead of cutting corners, explains Chon Hong. In-house capabilities allow the company to accomplish this: For smaller projects, it activates its two small workshops for upholstery and carpentry in Woodlands, and for bigger commissions, they engage their vendors in China and Malaysia.

The government’s ‘cooling measures’ have influenced consumer sentiment in the residential market, and has affected the performances of Xtra’s wardrobe and kitchen businesses. “Clients’ budgets have come down, but as long as our products are competitive and our service strong, we stand a good chance.”

Choon Hong reveals that their retail, contract and office businesses are in the black, and that they have not faced a situation where one part of the business has to sustain another. “It’s difficult to determine the contribution of each business to the group bottom line. Retail gives contract visibility. Contract helps lower our freight and warehousing costs. The businesses are highly integrated. There’s a lot of synergy between office and contract businesses—that’s how they help sustain the group.”

  • A STRONG START
  • GROWING BY MEASURE
  • WEATHERPROOF PLAN
  • SOLUTIONS, NOT PROBLEMS
  • HERE FOR THE NEXT STAGE

Here for the Next Stage

Xtra has been working with some of the brands it represents for many years. “It’s a relationship,” Choon Hong affirms. “Magis, for example, has been with us for nearly 25 years – almost form the beginning. We really grew up together.” Dedon is another longstanding partner for at least 20 years. Through the store, customers can see the evolution of the brand.

“We’re talking about meeting the aspirations of people who want to have beautiful furniture in their homes. We try our best to meet those aspirations; from premium to luxury, within the spread, we try to offer them a solution.”

It’s not a stretch to imagine finding something for everyone at Xtra—they’ve deliberately chosen to offer design-driven merchandise. “Any product of design significance has a value,” Choon Hong explains. “We try to find affordable design pieces, but there is a threshold where you can no longer find significant design value.” With that they have identified premium to luxury as their niche, carrying collections from brands with strong design profile and aesthetic direction. “Herman Miller and Magis are premium—not luxury brands —but they have very strong design DNA.”  

The selection is rigorous: they hand pick products that they like, while keep an eye on market taste. “Our selection is tempered by what we think the market will want. It helps to have a design background, along with sustaining an interest in the business.”

Xtra has been with their customers since the time they started furnishing their first homes. “Some of them still use the furniture that they bought from us when we first opened; that’s heartwarming, but what we want is to be with them for the next steps, as they upgrade or acquire their next homes.”