Online shop exports design with a staggering growth rate
Successful online sales is also mastered in Finland. The online sales of Finnish Design Shop are growing steadily but in controlled fashion. The realistic growth rate is staggering 40 per cent.
”We have been growing at a two-digit rate since the beginning. 40 per cent growth is what we can achieve without taking too big a risk”, says Teemu Kiiski, CEO of Finnish Design Shop.
The operations of Finnish Design Shop are based on their own warehouse for which they purchase the products in advance. A large share of the suppliers are surprisingly small, so the importance of supply performance is emphasised. Mr Kiiski says that the growth could be even faster, if the availability of products were better.
”We prefer to operate so that the logistics and personnel can be built in a sustainable manner.”
A great idea that arose from ashes
Finnish Design Shop was founded in 2004 after the IT industry had gone through a global crash.
”The only thing that got through it relatively unharmed was online shop. I came up with the idea to combine online shop with exports of Finnish design.”
The company searched for smaller design brands alongside the big names, such as Marimekko and Iittala. The small ones make the big ones more interesting and the big ones lend credibility to the small ones. The same principle still applies. The suppliers now number around 170.
”The products need to fulfil certain criteria: the brand, product quality and design but also deliveries have to be in shape. It’s really important to us that the customers get the products without undue delay.”
Based on demand, the company ended up expanding the product range from Finnish to Scandinavian design. The products go together well with the fairly austere Finnish design.
Excellent location in Turku
Mr Kiiski encourages people to think about the markets widely: the more marginal the product, the harder it is to sell it unless the market is global.
”We have sent chairs even to Aruba”, Mr Kiiski says.
The head office and warehouse of Finnish Design Shop are based in Turku, next to the Port. The location is perfect. The goods move fast, competent labour is available, and the premises are ideal as it has been possible to expand as needed up to the current 3,500 square metres.
The whole world as the market place
”If you place the order today, the package can at best be in New York tomorrow”, Mr Kiiski describes the efficiency of logistics.
A combination of several companies makes the shipping services efficient. International deliveries are handled by UPS and GLS and new service providers DHL Parcel and DHL Global Mail. In Finland the delivery services are provided by the Post and Matkahuolto.
International cargo shipments are carried by DSV, and TNT is being introduced. At least DSV shipments and a large share of DHL’s deliveries are now carried via the Port of Turku.
Customers outside the EU are themselves responsible for all customs duties and local taxes. An exception from this summer on is Australia. The online shop is liable to pay tax for shipments valued at under 1,000 Australian dollars. A dedicated payment system has been created for that, and it has not caused feared costs for the shop.
”Cargo volumes are constantly growing. The shipments are bigger and bigger. The number of large items has increased, and shipments by sea are growing”, Mr Kiiski sums up.
Text and photos: Sini Silvàn
Finnish Design Shop
Finnish Design Shop delivers products to 184 countries. Orders for Finland are placed at www.finnishdesignshop.fi, those for other countries at www.finnishdesignshop.com.
The most important market is the United States. In addition to Europe, other strong markets include Australia, Japan and Singapore. There is also an emerging interest in design in Russia and China. On the market, Ikea is often the trailblazer that creates the demand. But when people grow tired of the Ikea look, they develop an interest in design of higher quality.
- Half of Finnish Design Shop’s turnover comes from Finland. The goal is to raise the share of international sales to 65 per cent by 2020.
- Turnover for 2017 stood at 14.4 million euros, an increase of 45 per cent on the previous year. The forecast for this year’s turnover is 20 million euros, and the goal for 2021 is 56 million euros.