Creating a home decor, appliance, or any related collection is a great way to expand your interior design business. Having your own product line will not only open the doors for a completely new market and new revenue streams but also position you as a leader in your industry.
This article is part of our Physical Product Launch Series.
- Adding a product line to an interior design business can open up new markets, and revenue streams, and position the business as a leader in the industry.
- There are five ways to add a product line to the interior design business, ranked from least control to most control.
- Each approach requires different levels of investment, management, and involvement in the supply chain.
- A strong brand and effective marketing are crucial for success in product line expansion.
- Adding a product line can provide additional revenue streams, access new markets, and boost the brand’s reputation, especially internationally.
- Before launching a product line, it’s essential to have a clear and solid product line strategy in place.
What is a product line?
A product line means a collection of products, in this case physical, that you launch under your brand umbrella. The products are similar and focus on the same market sector. Often their function and distribution channels are the same or similar. Also, their physical attributes, prices, quality, or type of customers are the same.
I’m covering 5 ways to add a product line, a collection of physical products to your interior service offer. The different product line strategies are listed from the least control and ownership to the most.
- being a brand ambassador
- opening a multi-brand store
- licensing your brand to manufacturers
- private labeling your products
- creating your own OEM collection
Let’s start with brand ambassadorship!
Become a brand ambassador
Becoming a brand ambassador is the easiest way to add a physical product to your business. This means you make an ambassador deal with the brand or several brands you endorse, and they pay you a commission based on sold items, per promotion, or a retainer.
This way does not include any major investments from your side. The brand that you work with owns the products, the supply chain, and the distribution, and you use your marketing skills to promote their products, making a commission doing that.
If you have a strong audience and a passion for a specific brand and product, this is a great way to add to a new revenue stream. Product brands love to work with professionals who can both act as their extended sales arm but also have a passion for the products and the will to become an ambassador.
This kind of brand affiliation will also boost your own brand, particularly if you are affiliated with a brand that is already a big player. But even if you start with smaller brands, that could be a great positioning for your business – you are an industry professional who knows about the up-and-coming brands and supports the newcomers!
This model doesn’t require a lot of product line management, and it’s a great way to get started with your product line.
Open a multi-brand store
What is a multi-brand store? This is a store or showroom that sells multiple brands. If you want to add products to your service offering, you could think about opening a store, either in a physical location or an e-commerce store, or of course, both.
Running a multi-brand store helps you also to buy products at a wholesale price, which is often lower than the trade price. So if you want to sell several brands’ products, you could open a store and start focusing on retail.
While opening a store might not be that complex once you have figured out the strategy and built your e-commerce platform, running a store is quite complex. Your store needs to have consequent opening hours, alternatively, your e-commerce store needs to have a solid infrastructure to make it work. So a lot of your resources will go into store management.
Also, marketing your store requires a lot of resources. If you already have a strong brand, you most likely have an audience that is interested in buying your products. But if you have no sizeable audience, you need to market your store a lot, which requires that you have the right resources to do that.
This model requires managing your product line, but not manufacturing management.
License your brand to manufacturers
Many designers dream about a licensing deal, and while this could be a very distant dream for many, this also is a great way to build your brand and extend your offerings.
Manufacturers are constantly looking for professionals to cooperate with. If you have a strong brand and positioning, you might be able to create these cooperations.
While these deals are very lucrative, they are not necessarily big profit pillars for you. If your collection sells well, it makes a great additional revenue stream, but more often than not, these deals won’t replace your full income and more.
However, creating licensing deals is a great way to build your reputation and add a collection without needing to invest in the infrastructure. The licensee will provide the full infrastructure for manufacturing and distribution and the licensor – you – will be part of the design team, and then, of course, participate in the launch, awareness-building activities, and other marketing activities.
This model requires managing your line, but not manufacturing management. However, this requires strong brand management.
Private label your products
Private labeling means that you select products that already are manufactured by a manufacturing company, add your own label on them, and sell them as your own collection. You might be able to make some changes to these products, but often these are products that are already being manufactured by, often large, factories, which you can buy in bulk and add your own label on them.
This is a great way to add products to your business, but this also means that your products most likely resemble other brands’ products – they are, after all, private labeling the same products too.
One great usage for this type of method is to add more products to your signature collection while keeping the cost lower than when you are producing your own signature collection. The number of items you can order from a factory is often in the hundreds instead of thousands or more…
This model requires both product line and manufacturing management, however, your products are somewhat standardized and can be found in many competitors’ collections too.
Design your own collection: OEM
The last, but very exciting option is to design your own collection using the OEM – Original Equipment Manufacturing model.
This means that you design a product or many, and work together with manufacturers to create them, whereby your forwarding company will forward the products from the manufacturer’s premises, which are often located overseas, to your warehouse, and your sales team will sell them further to your partner retail stores or direct to consumers using your own channels, often an e-commerce store.
In this model, you own and control the full supply chain from manufacturing to distribution. Of course, there are many partners you work with, for example, such as a logistics company, and a warehouse, which is often a 3PL company.
Third-party logistics providers typically specialize in integrated operations of warehousing and transportation services that can be scaled and customized to customers’ needs, based on market conditions, to meet the demands and delivery service requirements for their products. Services often extend beyond logistics to include value-added services related to the production or procurement of goods, such as services that integrate parts of the supply chain. Source.
Should You Add A Product Line To Your Interior Design Services?
Adding a product line and product mix to your service firm can be a great way to add another revenue stream, expand to markets that are not accessible with services, or to demographics that won’t buy your services. Also, it’s a great way to build your brand, often in the international arena.
But, as you might notice, there are many considerations before you launch your product, and you should be clear on your product line strategy before you venture out to products.
There’s a theme that keeps coming back… regardless of the methodology, you need to have a solid strategy for there elementary components of your business:
Continue to PART 2 – how to create your OEM collection. We will also cover product line pricing strategy, how to sell your products, how to market them internationally, and more!