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Do the Math: Karastan's New Vintage Tapis by the Numbers

Carol Tisch
12/7/2017
DO THE MATH: KARASTAN'S NEW VINTAGE TAPIS BY THE NUMBERS


Karastan launches Vintage Tapis, its new foldable rugs with a hand-knotted look, in a dramatic display at its High Point showroom.

HIGH POINT -- The trend to foldable rugs has been growing in tandem with retailers' expectations of direct to consumer shipping by vendors. It is fortuitous then, that the consumer's penchant for soft and worn vintage looks in relatively flat pile weaves are now considered the height of fashion.

Merging its freight cost-cutting and speed of delivery objectives with styling and price points that would resonate with end consumers, Karastan launched the Vintage Tapis collection at the recent High Point Market, the newest extension to its Patina Vie licensing program.  
 
Sarah Willett, founder of Patina Vie, at Karastan's October High Point launch of Vintage Tapis.
 
RugNews.com caught up with Brandon Culpepper, vice president of specialty sales for Karastan, to learn more about the partnership with Patina Vie, the genesis of Vintage Tapis from construction to finished designs -- and the buzzed-about display created for the collection to increase rug turns and profit per square foot at retail to unprecedented levels. 
 
"The profit on the Vintage Tapis display will be above the roof for anyone that carries it." -- Brandon Culpepper

 
 
Q: How has the Patina Vie partnership evolved at Karastan?
 
BC: When we introduced Patina Vie last January the designs were made in existing Karastan qualities such as Cosmopolitan and Titanium. Vintage Tapis is Patina Vie founder Sarah Willett's first standalone collection built from the ground up for Karastan (read story).
  
Patina Vie Vintage Tapis collection rugs are folded and packaged with twine handles for "grab and go" bazaar-ambiance at point of sale.
 
Q: You deliberately set out to invent a foldable machine-made rug -- why?
 
BC: What we knew about machine-made rugs - not just ours but the markets in general - is that they are space hogs. Take up a lot of room. And they require 8x11 racks or 5x8 racks or thick stacks. I don't think that's ever going to change necessarily, because that's what the industry calls for to merchandise rugs.  
 
But at the same time we wanted to come up with a machine made rug that would really behave like a hand-knotted rug. Meaning that you can fold it and put it on a shelf, fold it and put it in a display, and you can box and ship it to cut down on freight costs.
 
And because Vintage Tapis rugs are foldable, you can merchandise them just like you were in a bazaar anywhere in the world.
  
A best-seller at High Point Market, the Vintage Tapis Versailles Garnet design features a cotton weft and EverStrand face.
 
Q: What came first, the new construction or the Patina Vie connection?
 
BC: It started with the construction. We showed Sarah the quality first, and she was all over it. The Patina Vie Vintage Tapis quality came from our proprietary construction using cotton weft yarns for the foundation of the rug and the EverStrand face yarn we use for Spice Market - which has a jute weft.
 
We weave the cotton and EverStrand in such a way that the rugs act just like hand-knots. The cotton weft plus the EverStrand face yarn give it the attributes of being foldable, and very soft. Plus it doesn't hold any kind of crease or wrinkle. It really wants to lay and behave just like a hand-knotted rug would.
 
Versailles Garnet from the Vintage Tapis collection is layered over a natural fiber rug in keeping with the casual Patina Vie aesthetic.
 
Q: Is it all about technology or is there a style and price story, too?
 
BC: Did we come up with this specific product because you can fold it? Absolutely. But I think it's going to be special because it's a new look for us and its totally different from anything else that we do. The quality itself is just very special, and consumers are reacting to it in an extremely positive way. They really like the fact that the rug is beautiful first and foremost. Because if it's not beautiful and it's not colored right to begin with, it doesn't matter that you can fold it.
 
Q: What about price?  How does it stack up?
 
BC: It's great quality, but at the same time it's $499 - $599 retail for 8x10.  A 5x8 would be $199 - $299.  So it's an amazing value for the look you get.
 
The Left Bank Vintage Tapis rug by Karastan combines traditional motifs in modern fashion colors.
 
Q: Who's the target customer?  Is it Millennials?
 
BC:  This is aimed at the entire market, but I do think that it has a real appeal to the Millennial.  It's made in a responsible way. It's made in America.  It's got a great price point on it.  I think all those different pieces will really register with the Millennial.
 
Q: Karastan also merchandises a lot of romance into Vintage Tapis, doesn't it?
 
BC: We laugh about the slogan we use:  We call it the '100-year-old rug made yesterday.' A Vintage Tapis rug looks like a worn antique hand-knotted - like a sumac, or a dhurrie, or the kazak type rugs you see that have a low profile. Like the ones that are sold as antiques: worn in places, not in others. They have that rich texture and patina to the colors, and all the things that go into what an antique rug is. Vintage rugs are huge in the market right now. The whole idea behind this was to get to that.
 
A detail of a machine-made Vintage Tapis medallion rug shows the flat-weave tapestry hand-knotted look Karastan achieves in this new construction.
 
Q: So when did Sarah Willett enter the process?
 
BC: Once we knew we had the construction, the next step was figuring out how to design the collection. We already worked with Sarah Willett on her first Patina Vie line for Karastan, and learned that she is an amazing rug designer. Sarah is a designer in that she actually draws the designs. She understands how looms work, she understands how yarns work so she is able to get elbow to elbow with our designer staff and come up with her own thing from the ground up.
 
Q: That's not the typical licensee/licensor relationship, is it?
 
BC: I'll say this: There are a lot of licensed products in rugs out in the market. And with most celebrity brands, the celebrity is not a rug designer. They have a lifestyle they're trying to sell, or they have a curated line that ties together everything from furniture to rugs, or whatever it may be.

Sarah understood this new construction we had. She was able to get in there and look at our colors and pull from that to develop her color creel. It truly is her rug line: it's her look and really just drops like a piece of a puzzle into the Patina Vie lifestyle.
 
The point of sale display for Vintage Tapis maximizes return on investment, holding 24 8x10 rugs in 16 square feet
 
Q: There was a lot of buzz about the Vintage Tapis display fixture at your showroom.  What's the back story?
 
BC:  Our customers were blown away by the entire package. When you have a product that people like from an aesthetic standpoint, and then you add more pieces of value to it, like the fact that you can fold it to save on freight, and then you've got this great display will drive more profit, it' a message retailers really like to hear.
 
Q: How do you figure the Vintage Tapis display drives profits?  
 
BC: It's amazing what you can do in 16 square feet. We fold up 24 8x10 rugs and drop them into a display that fits into a pallet. If you evaluate the retail floor on a profit per square foot basis, this drives the profit per foot through the roof because there's so much inventory in such a confined area that can turn pretty quickly. 
 
Signage on the Vintage Tapis pallet display illustrates that consumers can grab a rug and take it home.
 
Q: Can you share the numbers with our readers?
 
BC: We frame it up this way: Your average sofa group in a furniture store takes up about 100 square feet. If you look at a furniture store that is 10,000 square feet and drives top line sales of $2.5 million dollars, then what you are saying is that you are getting about $250 of sales per square foot annual. 

In normal profit margin - let's say 55, you're getting $140 of profit in that 100 square feet. That's about what a furniture store is going to get out of a sofa group annual on average.  For years, we sold rug racks against that metric. We said, a 5x8 rug rack has 20 arms and takes up about 140 square feet - if its 14 feet wide and about 10 feet deep. With the industry average being 2.8 turns, you can think through the sales: it's a little bit over $40,000 in top line sales and if it generates at that same 55 profit margin you end up with about $175 of profit per square foot - which is good. Better than a sofa group on average. That's how you can convince people to get in the rug business. 
 
Designs in the Vintage Tapis collection range from transitional to classic with a fresh Patina Vie color palette.
 
Q: And how does Vintage Tapis measure up in profit potential?
 
BC: With the Vintage Tapis display, and the fact that it's 8x10s folded in a display measuring 16 square feet -- even assuming an average industry turn rate of 2.8 it's going to generate over $1,300 in profit per foot. That's assuming it doesn't go above a turn rate of 5, which I think it will.  
 
The point made is the profit on this display will be above the roof for anybody that carries it. You've just got a winning story there. A winning quality, a new designer, a new technique with a game plan drawn up to be very, very successful.
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