In The Shadow Of Giants

June 16, 2006
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GRAND RAPIDS — Ask any commercial furniture dealer or salesman in the region: There is no market quite as interesting, or challenging, as West Michigan

Although it did not purchase any of its furnishings, the Grand Rapids headquarters of the West Michigan Environmental Action Council makes for a striking example.

Here is a Hekman Contract reception desk, a Steelcase conference table and chairs, a Herman Miller-furnished staff room, a Haworth chair in one room, an izzydesign chair in another.

Each installation is intended to promote the earth-friendly products of West Michigan manufacturers, but has inadvertently created the most extensive exhibit of competing commercial furniture offerings this side of Chicago's Merchandise Mart.

The council's space in Bazzani Associates' EastHillsCenter of the Universe retail complex didn't start out as a showplace of furniture companies, WMEAC Executive Director Tom Leonard assured. But because of all the local companies working with sustainability, it happened.

"I don't think this would be possible anywhere else," he said.

Interphase Office Interiors in Grand Rapids — the Haworth dealer in West Michigan — uses WMEAC as a case study in its marketing material.

"This market is very different from any other market in the country," said Interphase CEO Randy DeBoer. "There's a lot of politics — and that doesn't have to be negative when you realize that our industry is very much based on relationships."

In other markets, the only relationship a potential customer might have with someone from the contract furniture industry would be with someone like DeBoer. In West Michigan, it's common to know dozens of furniture insiders. Perhaps they go to the same church, belong to the same country club, or their kids play on the same soccer team.

"I've always said that Grand Rapids is the most unique market in the world for office furniture," said Dave Custer, owner of Custer Workplace Interiors and former Michigan sales manager for Steelcase Inc. "The biggest issues are the major service providers. Some of these companies — maybe it's a manufacturer's bank, advertising or accounting firm — there is just no way we're going to get their business."

For the largest companies, the lines are boldly drawn.

Major service providers generally represent only one client of each type, so, for instance, when Ernst & Young LLP shops for new furniture, odds are it will turn to audit subject Herman Miller. When BDO Seidman LLP redoes its offices, it will probably pick audit subject Steelcase.

In West Michigan, the connections are much closer than vendor relationships. Take Fifth Third Bank, for example. Not only is Steelcase one of its largest clients in the region, Fifth Third Bancorp also controls roughly half of its common stock. Steelcase CEO Jim Hackett sits on the bank's board, and the Michigan board is dotted with Steelcase executives.

Likewise, Herman Miller Chairman Michael Volkema sits on the board of Wolverine World Wide. WesternMichiganUniversity named its business school after Haworth's namesake.

"There are times when they say that just because so-and-so is on the board doesn't mean they get to pick what furniture they buy," Custer said. "But whoever you're aligned with, you're going to buy that furniture. They say they'll be fair, but when the time comes, something happens, and they just can't pull the trigger."

For Big 3 dealers, the alignment usually balances out. While there are companies apparently closed to a dealer like Custer, there are others that will exclusively buy his Steelcase line at the expense of Haworth dealer Interphase.

With that, the playing field is slanted against dealers such as Kentwood Office Furniture, which represents no major West Michigan manufacturers.

"There is a significant advantage in selling product lines by the major manufacturers in the West Michigan area," said Kentwood President Art Hasse. "The customer first looks for the solution, but if there is a tie, they'll always go local — even if it's something like Trendway or American Seating."

Grand Rapids customers are more likely to buy Steelcase; Holland companies prefer Haworth

No one is looking for Allsteel, an Iowa line Kentwood recently dropped, or Iowa-based HON or Illinois-based Kimball. If someone does buy an out-of-area brand, it's because either the price or specific features could not be found in a local alternative.

The local preference has boosted Kentwood's used furniture sales.

"We get jobs where the customer demands that it's Herman Miller," Hasse said. "But they're happy if it's used."

Like WMEAC, the region's furniture politics truly come to light when an organization has strong connections to several different manufacturers. Custer suggests companies just go with whichever manufacturer has the lowest bid.

"I'd say that most companies will pick the one they do the most business with," said furniture consultant Michael Dunlap of Michael A. Dunlap Associates. "No one is going to come in and pressure you because you do a lot of business with a manufacturer."

Ted Etheridge, president and owner of SVH Group, acknowledged that he had never been pressured into buying furniture for that reason, but he feels obligated to, nonetheless. The commercial printer matches its furniture purchases as closely as it can with the percentage of business it does with izzydesign, Steelcase, Turnstone, Herman Miller and others.

"I don't think any of our orders will make or break them," Etheridge said. "But they do their business based on relationship and trust, and I want to show I appreciate that."

As a former executive at furniture supplier Suspa Inc. in Grand Rapids, Dunlap saw the same thing. The company split its office between Haworth, Steelcase, Herman Miller, Trendway and American Seating.

He compared this to the automotive industry, in which he began his career.

"It is easier in automotive; you can just buy three or four different cars," he said.    

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