Author: Julie Deignan, Director, Furniture Advisory Services
Contributors: Aileen Pendleton and Kim Maziarz, Senior Furniture Advisors
Over the years, many industry partners and clients have voiced the same concerns and frustrations when it comes to the interior build-out process: the furniture bidding and evaluation process.
Project managers typically come from a background in construction, architecture, design or engineering—as opposed to a furniture background. Furniture is a major piece of a build-out that needs an expert eye in order to elevate the client experience, and it’s a piece that’s missing in most projects. Because of this lack of expertise on a typical project team, mentioning the word “furniture” to those involved in an interiors project can be met with tension and negativity.
With furniture being the second largest spend on a project (~30%), construction being the largest, the negative reaction toward furniture signals a need for change in the traditional bidding and buying process.
Discovering Pain Points
Based on years of research, CBRE discovered 5 significant client pain points:
- Pricing is confusing
This sort of confusion creates early on-set mistrust between the client, dealer and manufacturer.
- Options are overwhelming
With a plethora of options, many clients feel as though they haven’t explored everything available to them, which can lead to lack of confidence during decision making.
- Limited understanding of the furniture process
When on-boarding project consultants, the process is fairly similar until they get to furniture. There’s confusion around team members, product representatives and price.
- Lack of direct communication
The project manager and design firm are usually the go-between for the client and furniture dealer. This process can interfere with direct communication with the client, causing mass confusion.
- The process is time consuming and frustrating
With limited understanding of the process and a multitude of issues related to pricing, options and communication, it’s no wonder clients and team members alike find the process time consuming and frustrating.
It’s important to understand that furniture manufacturers and dealers are not furniture advisors. Yes, they know how their product may work but because they only represent specific lines, they can’t be a neutral party. Only an advisor who’s not tied to the product and what the client may or may not buy is able to navigate them properly through this process as a trusted advisor.
Every step of a furniture advisors’ process ties back to solving for the client pain points. In the traditional model, the process and evaluation order is as follows:
Figure 1: Traditional Model
This traditional model is confusing because how can anyone evaluate a product without knowing the price and the people who will sell and service it?
Making the Flip
Once the CBRE team was able to truly listen to our clients and their concerns, we decided to flip the evaluation order to:
Figure 2: CBRE's Model
We start with people because when the bidding process is set up correctly, pricing will be on-budget and within an approximate 5% range between bidders. In addition, when set up correctly all products are vetted by the design firm in advance of issuing the RFP so all products meet the design intent.
As a culture, we tend to buy a product or service from people we like, trust and have confidence in. Our clients are no different. As a furniture advisor, our process starts with interviewing the people shortly after programming so they can present their team, services and experience to the client. This allows the client to assess dealer chemistry.
As the furniture advisor, CBRE will issue the RFP, analyze and level the bids, and develop a pricing summary. We then take the client to see product options, explain pricing and give them time to determine what is or isn’t important to them and how they want to spend their money. Once the client has a clear understanding of the product cost and their support team, the evaluation of products become clear, and they can make educated decisions.
After working on over $500 million worth of furniture projects in the last 5 years, what I can tell you is that when this new process is employed properly, our clients are able to determine their furniture partners with 100% confidence. At this point, all of their pain points from the traditional model have been eliminated.
For more information about CBRE's Furniture Advisory Services contact Julie.Deignan@cbre.com or call +1 312-861-7874