At first appearance, a UK firm that is entirely reliant on rural craftspeople in Jaipur, India, appears to be a problematic strategy. Artisan Furniture, on the other hand, has made a point of it and has remained resilient throughout the epidemic, racking up double-digit growth and currently on an expansion path, aided by Goldman Sachs GS -0.4 percent.
Since its founding by CEO Amit Basu in 1995, Artisan Furniture’s linear worldwide supply chain has been designed to support an ecosystem of hundreds of skilled furniture makers in Jaipur, Rajasthan, and the surrounding territories.
The idea has also ensured that products being marketed today to retail partners such as TKMaxx, the European subsidiary of apparel and home goods group TJX Companies; Spain’s leading department store group El Corte Inglès; and Wayfair W +2.3%, are authentically Indian-made and hand-crafted; features that carry a price premium.
Basu’s budding furniture import/export business was started with $600 in scholarship funds and ran out of a garage in Jaipur at the time. His major break came when he decided to focus on pine, which was regarded exotic in India due to its scarcity. He manufactured furniture with a European look by combining imported New Zealand pine with India’s ‘jali’ design, which made him a billionaire before he was 30.
Since then, Basu has been committed to ensuring that Artisan Furniture stays true to his original aim of preserving and strengthening the handmade skills prevalent in India’s north west. Artisan Furniture suffered a drop in expenditure on lifestyle furniture when the global financial crisis began with the bankruptcy of Lehman Brothers.
Basu told, “We had two options.” “To survive, either automate and move away from experienced artisans to machine-churned products, or stick with the current model and drive sales forward.” The firm pursued the second path, taking advantage of then-Prime Minister David Cameron’s proposal to choose entrepreneurs from around the world for special visas to the United Kingdom.
Shortly afterwards in 2010, Artisan Furniture was incorporated in the U.K., through Global Vision Direct Limited, a move that helped save the company. In turn it has ensured the long-term prosperity for several villages around Jaipur—which was made a UNESCO world heritage site in 2019—and where more than 350 artisans form part of the furniture company’s supply chain. According to Basu, several of them have made the equivalent of £100,000 or more in the process.
A platform for selling handmade furniture on the internet.
Following those difficult years, the company prospered, and Artisan Furniture experienced significant expansion as sales improved. The CEO claims that the company is currently growing at 40% year on year, and that by March 2022, it will be worth £7.5 million ($10.1 million). Despite the supply chain issues that have afflicted so many industries, the entrepreneur predicts that the company will surpass the £10 million ($13.5 million) threshold in 2023.
Basu has bigger long-term ambitions. Having fully digitized the business in 2016 and created three verticals—wholesale furniture, trade furniture and dropship furniture to cater to large, medium and small retail/consumer clients respectively—Artisan Furniture plans to convert its existing e-commerce entity into a marketplace platform to encompass more craft products, and use artificial intelligence and machine learning to do it.
“We aim to add accessories to our portfolio by offering a holistic home living experience thereby covering Indian artisans from rural locations such as Moradabad (known for brass making), Firozabad (a center for glass production), throws from Panipat, wooden artifacts from Saharanpur, Bhadohi carpets, cabinet accessories from Aligarh, and of course furniture from Jaipur,” said Basu.
Mentoring via 10KSB UK
These adjustments constitute a significant strategic issue, so Artisan Furniture decided to seek assistance—and received it. Goldman Sachs was so impressed with the company’s recent development and future aspirations that it hired it as part of its 10,000 Small Businesses UK (10KSB UK) programme for 2022 earlier this month. The scheme, which accepts roughly 140 companies each year, assists entrepreneurs in creating jobs and economic opportunities by providing access to education and business support from prestigious institutions such as the Sad Business School at the University of Oxford.
According to the investment bank, 99% of all U.K. employer firms are small businesses and they are nimble growth engines for the economy, particularly when having to pivot during a crisis like a pandemic. The 10KSB UK program specifically targets firms with a track record of fast growth. The bank said: “This subset has a disproportionately strong economic impact relative to its size. This community is instrumental in solving the skills crisis, accelerating digitalization, and embracing sustainability.”
Artisan Furniture has benefited from rising
customer awareness of the environment and corporate social responsibility. Its
concept of assisting local crafters and preserving artisan skills has helped to
boost demand for the company’s products, which are made from sustainable,
commercially cultivated woods like as mango and sheesham (rosewood) and are all
certified by the Forest Stewardship Council.
During the pandemic, the big shift for
furniture was to online, driven by giants such as Amazon and IKEA, the world’s
biggest home furnishing retailer. The Swedish company—which is looking at some
new retail ideas—saw revenue fall to €39.6 billion in FY2020 due to the
pandemic, after two decades of growth. But in FY2021 IKEA’s sales bounced back
to €41.9 billion—slightly above FY2019—with e-commerce making strong headway, up
73%.
With so many more customers and suppliers
becoming accustomed to purchasing furniture online, Basu’s notion of creating a
niche online marketplace for artisan-only products may be ideal. According to
Statista’s Consumer Market Outlook, global furniture sector revenue reached
$1.3 trillion in 2020 and is expected to climb steadily to $1.6 trillion by
2025. Growth in the United States, where Artisan Furniture has a store in New
Jersey and is still testing the market, is predicted to be high as well, with
annual growth of 20.8 percent expected to reach $145 billion by 2026. The
forecasts could hardly be much more optimistic. Coutesy: www.forbes.com
