In the fickle world of furnishings and home décor, one particular trend has been clobbering every other category in the past few years, and especially since the 2009 recession. Across North America, and particularly in warmer southern states, homeowners have been dropping impressive piles of cash on so-called “outdoor rooms”—patios that have been not only carefully landscaped but also fitted out with sectionals, outdoor TVs, high-end barbeques and gas-powered heaters.
Consequently, outdoor furniture sales have been expanded by a blistering 10% to 12% per year since the recession ended, compared with a more modest growth rate of 3% for conventional niches such as bedrooms.
All this activity has come as welcome news to Stratford, Ont.-based C.R. Plastic Products Inc., a firm that manufactures a rainbow selection of Adirondack chairs, as well as a wide range of outdoor furniture, from recycled materials—another booming category of late. “We just happen to be in both of those segments,” says the company’s co-owner and vice-president finance Bruce Ballantyne. “People are cocooning in their backyards.”
These days, the 120-employee firm, which has seen its top-line jump by 165% in the past five years and ranks 306th on the 2014 PROFIT 500 ranking of Canada’s Fastest-Growing Companies generates revenues in the $5-10 million range, half of it from U.S. sales (most of the rest is Canadian).
The company traces its roots to a highly rudimentary export operation. In the mid-1990s, C.R. founder Jamie Bailey, a furniture craftsman, began making Adirondack chairs out of recycled plastic in his shop. They only came in one colour—grey—but the design was true to the original version. In the winter, he’d load about a hundred into a truck, haul them down to Florida and sell them at flea markets.
He also placed the chairs at the Toronto Home Show, but consumer demand remained thin, despite media interest in this novel recycled product. Bailey continued to do custom woodwork as his mainstay. In the mid-2000s, however, sales began to take off with growing consumer acceptance of recycled plastic as a highly durable, and maintenance free, alternative to both vintage wooden furniture and the flimsy but ubiquitous injection molding plastic armchairs. Bailey also began manufacturing the chairs in his signature eye-candy colours.
READ: Lessons in U.S. Expansion
By the late 2000s, they were selling through hundreds of dealerships, and had garnered interest at large trade shows. Yet the company, with sales in the $5 million range at the time, slammed into a capacity ceiling. “We have to turn down Costco every year,” Bailey said during a 2010 appearance on the CBC’sDragon’s Den. “We did a trade show in Las Vegas, and the first person who came up wanted to buy 10,000 chairs but we were only making 12,000 a year, so we had to turn it down.”
The Dragon’s Den appearance was a turning point. Bailey agreed to sell 50% of the shares to Jim Treliving, chairman and owner of Boston Pizza and entrepreneur Brett Wilson, bring on professional management, and invest the proceeds of the deal in new automated equipment, all with the goal of reaching the $20 million revenue mark by 2015.
Learn how C.R. Plastic Products makes tradeshows pay off by downloading this week’s free PROFIT TRADE TIPSHEET.
With the new manufacturing resources, C.R. embarked on a line extension campaign, adding a range of new outdoor furniture products meant to complement the Adirondack chairs, which remain the company’s best sellers. Sales have grown so quickly the firm has had to re-locate three times to ever-larger premises.
Ballantyne, who joined the firm four years ago, has helped oversee an ambitious expansion of the company’s marketing efforts, which focus on a series of huge wholesale furniture and gift trade shows in Atlanta and North Carolina. In the past few years, the company has added other major shows to its circuit, including the world’s largest casual furniture show, in Chicago, and a pool-and-spa trade fair. “We like to go to shows where we’re the newest thing,” says Ballantyne.
The firm is also embarking on boosting European sales. For several years, C.R.’s products have been carried by distributors in the Netherlands, Sweden, and Germany. But Ballantyne says the company has decided to take a more direct approach by making an appearance at a large European show in early fall, the Spoga Gafa garden show in Cologne, Germany. Ballantyne says he’s also been speaking with distributors in France and Norway.
The rapid growth, however, has drawn competitors, and C.R. is no longer ahead of the curve when it comes to designing novel, eco-friendly furniture. Most of the big shows include other firms plying the same waters, which is why C.R.’s marketers know they have to work that much harder to generate buzz and grab the attention of buyers wandering the floors of these immense trade fairs.
As Ballantyne says, “You have to do something unique that you become known for.”