Developing Our Business Model
It was in Pembroke that we really developed Eldred Wheeler’s business model. When Bill and I founded the company, we did not write a comprehensive business plan. Instead, we decided what products we thought we could sell, put together a list of individual assignments, and sort of “winged it” from there. As time went on we addressed strategic issues as the need arose. For example, we would take a stab at sales forecasts every few months and then tailor a budget to fit. Or, when we set up our first dealer, we established a wholesale price of 40% off list. This discount wasn’t based on industry norms, since we had no idea what other furniture manufacturers did. It just seemed like the right amount to us. By the same token, we hadn’t given much thought to our competition, or what distinguished us from them. We really felt that we were pioneers, creating a new category of furniture. “It’s better than anything out there, and it’ll sell itself” was our basic marketing strategy.
In hindsight, I think we did produce an excellent product, but there were a number of individual cabinetmakers who could put us to shame. I remember seeing an advertisement for reproductions by Brian Pear. His workshop was a few towns away, and I decided to pay him a visit. He was completing the work on a rococo Philadelphia highboy the day I walked in on him. Brian worked alone, and it appeared he shipped his commissions as soon as they were finished. I remember looking at the highboy’s carvings and cabinetry, and thinking it was far more sophisticated than anything we made. I was so impressed that I ordered a set of four shell-carved, balloon-seat Newport chairs, in maple. As good as Brian’s cabinetry was, I felt he missed on his finish, so he agreed to deliver the chairs unfinished. Joanne and I still have them, and I swear the shells are so perfect they look like they’re molded from clay.
What we discovered through experience was that our customers bought the “total package”: form, style, wood, workmanship, and finish. Our products came pretty close to the total look and feel of 18th century country high style antiques. Other shops or individuals would sometimes hit on the cabinetry but miss on the finish, or they would have a great finish but the form would be off. I guess ours was a bit of a decathlete’s approach: not necessarily to be best in each event, but to be best overall.
While our “total package” product approach helped drive customers orders and build our reputation, I believe that our production approach was ultimately the basis of our competitive advantage. The approach involved compartmentalizing the many different activities required to make a finished product. This was hardly a unique approach; in fact, it was “Basic Manufacturing 101.” The interesting thing was that it had never been fully applied to shops making our sort of handcrafted furniture. Our initial sense was that the rough milling and finishing could be split out, but that trained cabinetmakers were required to build most of the piece. This approach was certainly used by almost all small shops, and even by some fairly large high-end furniture companies. The obvious problem with this approach was that it restricted the rate at which production could be increased. Growth becomes a function of how fast highly skilled cabinetmakers can be located, hired,and trained.
What Eldred Wheeler did was to first compartmentalize rough milling, finish milling, assembly, sanding, and finishing. The key activities in each of those five processes were identified, and the techniques for performing them were then simplified to the point where they could be applied without error by individuals with limited training. Employees thus became specialists in one or more areas. Cutting lists were computerized and printouts were given to individuals in the rough and finish mills. The easy-to-read lists enabled them to quickly set up their machinery and begin cutting wood to a specification, rather than worrying about where the wood was going to be used. In the rough mill, criteria for board match and wood quality were developed and documented. While trained eyes were still a necessity, compartmentalizing the production tasks greatly reduced guesswork and eliminated problem components early on. The finish mill incorporated jigs and auto feeds, which reduced setup time and practically automated many of the mill’s operations. The finish mill’s goal was to produce component parts “just a hair” over their final dimension. The slight excess would be removed with hand tools in assembly.
Workers in assembly received what amounted to “kits.” Of course, all surfaces had to be hand-planed and/or scraped prior to the hand fitting and assembly, but special benches and fixtures were designed to aid in those processes. We also developed such simple tricks as quickly marking surfaces with a flat pencil to make sure our hand planers didn’t miss any areas. Teaching guidelines for reading the grain in order to minimize tear-out helped simplify the tasks of planing and scraping.
But “routinization”—the division of complex work into simple jobs—has its limits. Since 18th century pieces were not designed for machine production, completing a piece of Eldred Wheeler furniture always required an extensive amount of handwork and hence skill. For example, the leg is typically flush with the skirt on an 18th century table or lowboy. This is also the case with Eldred Wheeler pieces. Because the two surfaces are rarely perfectly level when milled, flushing is usually required after final assembly. This is accomplished by hand with a chisel and/or scraper. It takes a considerable period of time for a craftsman to become proficient at fitting and flushing legs and skirts. Modern design allows the leg to protrude above the skirt to avoid the need to flush the joint. However, Eldred Wheeler pieces would not be authentic if this design concession was adopted. For almost all of our pieces, the assembly step required the greatest number of worker-hours. It was the step at which our workers departed the late 20th century and entered the 18th, using only the hand tools of their predecessors.
With each of our production areas focused on simplifying and specializing, we were able to hire based on aptitude rather than previous experience or training. This flexibility enabled us to ramp-up production rapidly, because inexperienced individuals could be brought up to speed on specific tasks in less than a week. (There were some exceptions, especially in the finish mill and some areas of assembly.) As someone developed proficiency in one area, he or she would be given the opportunity to move on and learn something else, usually something a bit more difficult. This approach to training and deploying our workers very soon started to yield both a consistently high level of product quality and a distinct cost advantage over our competitors.
As our business grew to approximately 20 employees, we quickly learned that business processes were essential. Other shops often hit a wall when they grew to around this size because their woodworker/managers were more interested in woodworking than in managing; in doing the planning and orchestrating that become critical once an enterprise consists of more than a handful of people.
During the Pembroke years, I gained greater clarity about my goals as a designer and woodworker. My initial interest in woodworking stemmed from a desire to acquire antiques I could not afford. “If I can’t buy it, I’ll make it.” That’s the primary reason I used old wood for most of my early projects. I had no desire to sign those pieces, because I hoped that at some point they would be mistaken for antique heirlooms. Essentially, I was trying to make fakes. I don’t mean that I hoped to pass off my pieces as antiques. What I mean is that I wanted to craft them so authentically that after a generation or so they would be absorbed into the antique domain. This obsession persisted during our tenure in Hanson. I made my prototypes from old wood whenever possible, and I did my damnedest to make those constructed from new wood look as old as possible. Gradually, however, it became apparent to me that the furniture we were creating had an integrity of its own. By the time we moved to Pembroke, it had come to my attention that customers actually coveted the early Eldred Wheeler pieces I owned. They had already become heirlooms of a sort. My desire to “make antiques” subsided, and I became much more focused on fine-tuning Eldred Wheeler prototypes, which we began labeling and signing.
I kept most of the early prototypes we made from old wood. Looking at them now through more seasoned eyes, I realize they weren’t very good fakes. In any case, they have much more value as collectible Eldred Wheeler prototypes. More important than their current market value, however, is the critical role these pieces played in the company’s early development. It was our attempts to simulate old original finishes and blend new wood with old that ultimately resulted in perfecting Eldred Wheeler’s finish, which more than anything else helped us build a following of loyal customers. All the early prototypes still in our possession now have appropriate labels, signatures, and brief documentations of