Outsource Your Procurement Woes (Christi Barbour)

Welcome to the Creative Genius podcast, Kristi. It’s great to have you back on and I am so excited to have you. Thank you, Gail. It is always a pleasure and a delight to be part of your podcast and to get to see you. So thank you for inviting me to be with you today. Thank you. Well, you’ve gone through a lot of changes in the years that you’ve been in business and

And frankly, you’re one of our big success stories. And I’d love for you to share some of the things you’ve gone through in the last several years. Well, thank you. We first of all, thank you very much for saying that. We greatly appreciate that. And you have been a big part of who we have become and the successes that we have achieved. So.

please know that you are part of that story. And so I would say that was first and foremost is the coaching that we have received through you. And just the advice that you’ve given us over the years to be nimble and adaptable to the ever -changing landscape of this crazy industry we call design. You know, our core passion has always been about creating spaces that people fall in love with, but with some guidance from you and your team.

we were reminded to not overlook how important the behind the scenes aspect is of running a successful business and being a CEO of a company. And that’s really led to a lot of ahas over the years. As you mentioned, we’ve had quite a few changes. One of which specifically that I’ll mention is based off of the fact that over the years and being based in High Point, North Carolina, we have had the true privilege of

creating some really exceptional relationships with vendors. And this has given us the opportunity to get better service, deeper discounts, create those relationships, which we know are so vitally important to the success of any business. Through developing those relationships, we have had the opportunity to better understand the procurement process because of getting to know these vendors and learning the business of procurement.

Over time, we recognized how much time and energy was going into our procurement process. That was certainly something we looked at with you. And so about eight years ago, we made the decision to bring on a part -time expediter and procurement person who pretty quickly got to be full -time over the course of a couple of years. And what we found was a significant shift in our business because we found that by having a dedicated person to procurement,

It allowed our designers to focus on what they do best, what they love to do, and that’s design. And then we had a numbers gal and a relationships driven person who got to focus on what she did best, and that’s Procure products.

Well, that’s interesting because some people do outsource it. And of course, we’re going to talk about that. And for you, you decided to bring it in -house. And then you became, I would say, an expert at procurement. And so you have now started a new arm of your business, which is to do procurement for designers. So talk to us a little bit about that.

I would love to. Yes, we made a decision, a choice a long time ago to pull procurement in -house, but we’ve also cried on your shoulder a number of times over all of the headaches that comes with that. And so I guess the short answer to that is we remember what it’s like. We remember what it’s like to be faced with.

not having the capital and the cash to be able to make minimum orders and or annual minimums and able to open accounts with new vendors. And so overworking over the last eight years, working to perfect this process and by no means are we perfect, but we certainly have worked hard to perfect it. We have recognized that all that hard work could help others. And so our motivation behind this procurement service

really drives from a genuine desire to support and uplift our fellow community of designers. We’re providing a service that can make a difference in their business. It could even be a stepping stone for their business. And so, you know, it gives us a chance ultimately to become a and a catalyst for growth for other designers. in doing that,

I’d like to think that we can provide advice or mentoring or be a resource or an advocate for them when it comes to the procurement of products. And so we’re really excited about that because that is a win -win for us to be able to lift the community of designers, our fellow community. So it sounds like that’s your why is partly because you’ve been through the pain. I that’s the reason a lot of us start our businesses is because of the pain we’ve been in.

been through with our businesses. Exactly. That is exactly why we started it. It’s just that genuine desire to support and uplift. But you know, Gail, it ultimately it turned out as we developed this, it has turned into a win, win, win. It’s a triple win. For the designer that we’re working with, it gives them the opportunity to make sales, to become a better value and give better service to their clients. And it increases revenue. And that most importantly, it gives them back valuable.

time. And to our vendors that we’ve talked with, it gives them the opportunity to sell more products and it prevents them from having to turn away small orders that don’t meet minimums. This way they’re getting all the orders. And then for us, well, yes, it increases our product sales, but that does ultimately lead to us getting better pricing and having buying power. And it allows us to support our industry and elevate the entire profession of interior design.

So that triple win was really important to us. So why do you think your procurement process and business stand out from other services that are available? Well, we are interior designers, so we’re walking that very same path. And we’ve been there. We remember what it’s like to start this process. And so a couple of points that I would say stand out differently or at one, you have a dedicated point of contact. We’re not private equity backed.

We don’t have fancy chatbots or anything of that nature. We are real humans that are located here in High Point, North Carolina in the middle of the furniture industry. And so that’s an important part. The second is designers don’t have to worry about an outlay of cash. We eliminate that financial burden, all of the cash exchanges between the client and us. And clients receive pricing that’s at designer net or even sometimes below.

which will stretch the designer’s budget even further and ultimately the client’s budget. we’ve just, as a membership -based service and the designer receiving commission, we are looking to help the designer with that elimination of that financial burden. So you mentioned streamlining your process into a handful of touch points when we talked about your program earlier. Can you talk to us a little bit about that and how that works?

That’s one of the great things about this, and you talked about pain points earlier, is we were really thinking about what were the pain points for us in terms of the procurement process and how can we help the designer because this has to be a multifaceted approach to helping elevate other designers. so streamlining the process for the interior designer was really important to us. And as we looked at the pain points for designers when we were developing this program,

We identified that if we could eliminate a lot of the steps out of the procurement process, if not all of them, that would save them valuable time, time that they could get back to do a lot of other things, build a book of business, spend time with their family, spend time on themselves. I who gets that these days? So time is a big value. And so we got it down to a handful of touch points, first of which being a new project form, which is exactly what it sounds like.

they’re going to fill out billing and shipping information just to make sure that we’ve got them set up properly in our system. The second is going to be, if you’re new with us, you’re going to be reviewing onboarding materials. This just helps you get familiar with our online portal and our vendor list. And we’ve got all kinds of tutorials to make this super efficient and pain -free for the designer. And once you become, once you’re part of our members and you know the…

you know the steps, you get to drop this one. And so that’s really something that you don’t even have to do anymore. The next for every project is the product submission form. And that is a simple copy and paste from the Web Vendors website directly into our online portal. The next is reviewing and approving the proposals once we send them to the designer, then the designer can share that proposal with their client. And the last is our warehouse inspection form.

Once the product arrives in the warehouse, we just need to be notified of any damages or quality issues so that we can promptly file those claims and take care of our design member. Well, speaking about pain points, that’s a big one for a lot of designers today is dealing with the claims that are coming in on products that are not made properly or made incorrectly.

And it has been huge for a lot of designers. I would hate to think how many hours they’re losing for that. Right. Yeah. It’s been significant. You know, we have found in our research that designers spend over on average over 50 percent of their day dedicated to the procurement process. And that includes those those claims that you just mentioned.

And so that’s another reason why we feel like this is a service that is much needed in our industry and greatly valued in our industry. And one of the things we’ve been in development of this service now for over a year, and that development phase was a crucial part of our learning experience because it’s with any new business and you know this all too well, but is with any new business. You know, the idea is get the idea out there, test it, pilot it.

and then bring it back and make the tweaks you need to and then test it again. And that’s what we’ve been doing over the course of the last year, getting feedback, making adjustments, and now we’re excited to finally launch that service. And so, for example, when we were in the pilot phase, we were receiving a lot of requests for wall covering and fabric vendors. And so we have listened to that and we have now added those as vetted.

offerings and will continue to expand those offerings and continue to add more manufacturers. And then the other thing is the warehousing that you mentioned in the claims. We know that warehousing is a big pain point for clients, for designers with their clients. So we are vetting warehouses across the country and we’re working to do the same with workrooms. So again, you know, our goal being to provide our members with as many resources as absolutely possible. So we’re doing that legwork.

we’re doing that vetting and we’re connecting those people so that you’ve got an easy button, so to speak, from the design side. What type of firm is appropriate for the kind of procurement service you do?

I love this question because this also evolved a little bit in our development and our pilot program. know, Gail, when we first started talking about doing this, we felt like the most logical answer to that was probably designers starting out young in their business. And what we have found in talking with designers all over the country is it’s really for anybody who is

seeking the highest return on investment for outsourcing their procurement. That could be an independent designer just starting out, or it could be a seasoned veteran who is just looking to, I’ll start over, that could be an independent designer, or it could even be a seasoned veteran who is just looking to outsource the procurement to get that off their plate, to either reduce their workload or give themselves back valuable time to do other things.

The program was developed with a deep understanding of those pain points that we mentioned, but it was specifically designed to maintain and accelerate that momentum of business to give those designers an opportunity to really accelerate and of course to focus, you know, having time to focus on clients and other.

When and why should somebody start outsourcing their procurement? I love this question. Personally speaking, as a designer, as an owner of a design company who has been faced with this question myself, I would suggest that people start to consider this when they find themselves spending 30 % or more of their time on procurement. It’s worth considering at that point.

And as I mentioned before, our research has indicated that most designers dedicate 50 % or more of their time to procurement. again, reclaiming 50 % of that time, think about what that could do to your business, whether that’s building your book of business, having time for additional projects, spending time with your family and kids, or even just giving that time back to yourself could make a significant impact on people’s lives. And again.

That’s what we’re looking for is impact. Well, you spoke about bringing it in -house and doing your own procurement in -house, but now you’re also recommending that people outsource versus doing it internally. So how do you make that decision? Because in your case, you all wanted to control over that. And I’m sure there are lot of reasons you took it back in -house.

Yes, we, I guess the best way to answer that Gail would be to say when we made the decision to bring it in -house, there were not a lot of opportunities for outsourcing procurement at the time. And we really felt like we didn’t have a choice. And so at that point in time, we did what we only knew we could do, which was bring it in -house and figure it out.

And like I said earlier, by bringing it in -house and figuring it out, we have worked for years to perfect that process. So when you ask about why should someone else outsource it, I think you have to look at the rate of return. When you hire internally, you’re paying wages, salaries, you’re responsible for all those tasks associated with employees, payroll, managing taxes, social security, the management of the team, and then,

as we’ve talked about over the years, there’s that uncertainty of not always being able to guarantee that the work is there. And so, you know, just the burden of the employee having that employee on the team to a small business is significant. So with a small membership fee of a thousand dollars, our members have access to any products they want and basically their own procurement person to handle all of those details and

they’re going to get a commission once they sell that product. So they’re earning an income, they’re offloading the tasks, most of which, let’s be honest, most designers don’t like the tasks related to procurement. I certainly don’t. That’s why we hired because we love the craft of design, the creative experience. I don’t like to be stuck in the numbers and the ordering, but there are brilliant people who love that. We happen to have

some of those on our team. And so it has, we have found that offering this service becomes a cost effective and efficient solution for designers. Okay. Well, I think that is interesting. And of course, you know, me, I did my financial modeling on that and I looked at it and you know, when you think about it, if you take a commission on something and you’re not doing the work associated with that.

then that profit margin is, in your case, better than what they would normally get in most situations. And they don’t have to have the headaches like you talked about. So I think that’s really something valuable to think about because that’s additional margin that you wouldn’t have otherwise. And you might not make that margin on other items that you do.

Exactly. And I appreciate that you took a look at that for us. You know, you were part of the pilot program, just the fact that we’ve we’ve talked about this and you you ran your modeling that we’ve we have worked with you ourselves on. So thank you for that affirmation. Sure. Absolutely. Well, we will put something in the show notes so people can get in touch with you about your program and if they’re interested. And but I always like to end the podcast with asking

for three takeaways that you’d like to share with our audience. I’d love to share that. Well, takeaways on the procurement services that we offer. One, I would say it allows interior designers to increase their revenue without having to handle that procurement process in -house. Two, it allows them to focus on design, since we know that that’s what most of us are passionate about who come out of school.

And then three, would say it opens opportunities for designers to really expand their vendor list and to ultimately be a better value to their clients. That’s terrific. Well, thank you so much for being on the podcast, Kristi. And as always, it’s great to talk to you and hear your ideas about this. And I am so glad I know you’ve been helping some of our clients with this, too.

Gail, I cannot thank you enough. Thank you for the opportunity to be here today. It was a delight and we always appreciate the opportunity to speak with you. Thank you. Thank you.