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Economist: Design, Technology, Fabric

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FT: Real places for virtual spaces

August 8, 2011 11:07 pm

Real places for virtual spaces

By April Dembosky

Lauren Geremia points to the ceiling, her shirt sleeve slipping to reveal a tattoo of a ruler on her right forearm, as she talks about the ping pong ball sculpture she is going to install above the rows of office desks and computers. “We’ll create clouds with hundreds of thousands of ping pong balls,” says the interior designer, in a calm, matter-of-fact manner. “It will help with sound diffusion.”

Ms Geremia is putting the finishing touches to her office design for Dropbox, one of the hot internet start-up companies based in San Francisco, which now features conference rooms decorated with celebrity portraits cut from old magazines, lead pencils hanging in hallways encouraging staff to write or draw their thoughts on the walls, and a kitchen with Chinese paper lanterns and a bronze counter. “It patinas as you touch it,” she says, as she presses the countertop, leaving a pink fingerprint. “It’s great for technology companies because the more you interact with it, the better it looks.”

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At 29, Ms Geremia is the same age as most of the chief executives for whom she consults. She says this gives her an advantage over established architects in their 50s whose designs are too expensive for a start-up’s budget or stylistically out of touch with the generation in charge of the new companies. Her preference for salvaging vintage doors and tables from the dump and creating decorative flourishes out of wires, string and ping pong balls makes her a better match for the industrial aesthetic they tend to prefer.

“I’m on the same page with them,” she says. “They’re new to money, so I’m growing with them. We’re on the cusp of building our companies and we don’t know if it will last. It feels good to do that with people just out of college.”

An influx of venture capital from Silicon Valley has allowed a new crop of technology companies to flourish in the past year. As they race to claim the top spot in their niches, from mobile social networking to document management, the companies are growing quickly and competing to hire the best engineers but also to find offices that are big enough to accommodate ballooning staff numbers and cool enough to attract and retain them.

San Francisco is increasingly becoming the preferred destination for start-ups staffed by 20- and 30-somethings, over quieter Silicon Valley towns like Palo Alto and Mountain View. Commercial rental rates in the popular neighbourhoods near the train station have increased 50 per cent over the past year, and vacancy rates have halved to 14 per cent.

A small network of real estate brokers, designers, landlords and business consultants is forming around these start-ups to earn its own cut of the internet craze – Ms Geremia is part of one real estate trio.

Ms Haeg loved working with her impassioned, idealistic peers. And she saw a unique business opportunity that her mentors did not – to start early with risk-taking companies and stick with them as they grew. So in 2006, when a tiny start-up with eight employees, called Twitter, asked for her help finding an office, she signed on. She has helped the company move three times in the past five years as the staff grew to number in the thousands.

Setting up house, start-up style

● Step one: find the space. Jenny Haeg helps start-ups find the right brick and timber buildings in San Francisco and works with landlords to knock down cubicle partitions, walls and ceilings to reveal the exposed pipes and beams that start-ups love.

● Step two: decorate it. Lauren Geremia talks to staff so that she can reflect the company’s mission in her design. For example, when she was hired by Path, a social networking start-up, she sat down with founder Dave Morin. “He talks a lot about connectivity and connecting the dots,” she says. “Everything in here is connected and linear and has a pattern quality.”

Thus, a painting in a small conference room features a mountain climber with a piece of yellow string posing as a climbing rope. It hangs down the mountain, crosses over the picture frame and pivots up to the adjoining wall, wraps round a pipe in the ceiling and lands in a loop at a black thumbtack pinned next to the door.

● Step three: secure the space. Chris Sherman monitors the process from start to finish to make sure all spaces comply with local laws and fire codes.

“Most start-ups have no clue,” she says. “I find out what they want and tell them if it can be done.”

Jenny Haeg, a commercial real estate broker, was well positioned to take on the latest generation of start-ups. Now 30, she began representing technology companies in San Francisco when she was 25. Her older counterparts were accustomed to dealing with law firms and financial companies that had set employee numbers and revenues. They didn’t trust the young founders’ promises of growth and success.

“Traditionally, I don’t think brokers really understand the internet or really get what these companies are doing,” she says. “I definitely think the age similarity helps.”

“All my clients, it’s all repeat business,” she says. “You have to take care of them from when they’re two people and a dog to when they need 90,000 sq ft of space.”

Rounding out the trio is Chris Sherman, a project manager who works with Ms Geremia and Ms Haeg to co-ordinate the details of a start-up’s office move and facilitate the process. “I have to make sure they’re legal and that they don’t burn themselves up with 5m cords on the floor,” she says.

Ms Sherman is 66 years old – “I’m the senior citizen here,” she says with a laugh – and has a background in real estate and general contracting, which she began applying to her work with start-ups about 10 years ago. Now she prefers working with “the kiddies”, as she calls them, because she finds their ambition and idealism refreshing.

“In the old days, it was canned,” she says. Her corporate clients all wanted offices and cubicle partitions to hide from each other.

Now Ms Sherman is managing renovations for start-ups who all want brick and timber buildings with exposed beams and pipes in the ceiling and an open floor plan with shared tables so they can talk and collaborate.

All the start-ups want a large meeting area where companies can have staff meetings and host talks, and where they can serve the catered lunches and dinners that are becoming de rigueur among start-ups, she says. Today’s start-up companies truly see the office as second home – night lighting is important for working late or hosting parties on the weekend.

“They say, ‘I don’t want it to look corporate . . . I want it to be cool and I want a music room and I want a game room,’” she says. “That’s why they like Lauren. She has an edgy, organic style and it appeals to the young people today.”

Ms Geremia began sensing the market opening for her interior design before the current technology boom and began to position herself to be the go-to designer for the geeks. After graduating from the Rhode Island School of Design in 2004, she moved to San Francisco and began designing bars and restaurants. She strategically took a job designing the Bloodhound, a San Francisco bar where start-up engineers go for happy hour after work.

Her real entrée into the start-ups came when the wife of a Facebook engineer saw a frozen yoghurt shop that Ms Geremia had designed, then hired her to decorate her house.

As former Facebook employees got funding to launch their own start-ups, Ms Geremia’s name got passed around as a hip designer who knew how to capture a company’s personality in its office space. “They all have a company culture, which I have to cultivate in the design,” she says.

Ms Geremia is delighted that there is a keen market for her style among office managers, but her broader ambition is to turn to the residential market, once her office clients cash in at their initial public offerings.

“I want to start designing all these peoples’ houses when they start buying them,” she says.

Copyright The Financial Times Limited 2011.

FT: Design - Kenneth Grange

Collecting special: Everywhere and nowhere

By Edwin Heathcote

Published: May 27 2011 22:35 | Last updated: May 27 2011 22:35

Designer Kenneth Grange at home in London

Kenneth Grange is ubiquitous. The day before I went to talk to him I’d taken a trip on one of the trains he designed and had got into one of the London taxi cabs he designed. I shaved with one of his razors, opened a door using one of his handles and waited for a bus at one of his bus shelters. No other designer has had the same impact on the London environment.

Yet his name will be largely unfamiliar, even to many design aficionados, and the forthcoming show at London’s Design Museum will be his first major exhibition for almost 30 years.

EDITOR’S CHOICE

Now 82, Grange was born in London to what he describes as “an ordinary background, flowers on the wallpaper, you know the kind of the thing.” At school he showed a talent for drawing and worked first as a scene painter for the fledgling BBC TV studios. He then studied at the Willesden School of Art and began working for architects, notably with Jack Howe and Bronek Katz. From bits and pieces of street furniture and fittings designed while with architects he went on to become a pioneering product designer, a field which – although established in the US and Germany – was only just emerging in Britain.

Grange exemplifies a type of industrial designer synonymous with an era of faith in modernism, a passionately held conviction that design could be used to make life and society better. If the designer today is presented by the PR machine as an artist and superstar, Grange represents an era when it was corporations rather than galleries who turned to successful designers.

Grange is sitting with me in his Hampstead house, one of the fruits of his success in the 1960s when he was the most efficacious industrial designer in the country and a partner in the pioneering multi-disciplinary design agency Pentagram.

We’re sitting at a big table which serves for dining, display, drawing, even model-making. There’s a workshop outside as well, a place of meticulous craft in which every tool has its rigorously designated place. But for now, Grange is surrounded by papers and photos from a full career, trying to hone down a representative sample for the exhibition. Does this mountain of stuff, I wonder, make him reassess his career?

“It’s a bit like looking at a family photo album,” he says. “I keep seeing things I’ve forgotten. I’m pleased, perhaps a little disappointed at some moments, but I was lucky to work on a lot of exciting things. I got into this trade [industrial design] so early that clients still had no experience of employing anyone like me and so I was, by default, pushing at the boundaries.

“It also displays all these social phenomena – shows how much life has changed. Everybody used to smoke, so I have a huge catalogue of designs for lighters. And there were paraffin heaters – it’s easy to forget it wasn’t so long ago that not everyone had central heating. And then, almost overnight, those markets disappeared.”

But there were plenty of others to replace them. Grange was commissioned by an extraordinary number of leading companies, in an era when Britain still had a big manufacturing base. He designed the first Kenwood Chef food mixer, irons for Morphy Richards, cameras for Kodak, washing machines for Bendix, pens for Parker, razors for Wilkinson Sword. He designed Britain’s first parking meter in 1958 and computer terminals for Reuters. His designs formed the background to everyday life in Britain during the postwar era. How did he manage to design so much? “Well, I’ve always had a bit of a work ethic,” he replies with the cheeky beginnings of a grin. “If you work 12 hours a day, six or seven days a week, you soon find you’re ahead of every other bugger.”

One job from 1968 exemplifies Grange’s particular combination of hard work, initiative, charm and chutzpah. “I’d been approached by British Rail to design a livery for a new train. It was a bloody ugly thing, it looked like a barrel with a port-hole at the front, but I’d learned never to say no to a commission. I’d done some bits and pieces for British Rail by then already – I had a bit of a track record. So, without permission, we started working on a new design, on what a train could be. We tested models in a wind tunnel (slipping the lab technicians at Imperial College a fiver) and we took along the new models, along with all the wind-tunnel information to British Rail.” It’s hard to imagine a designer today being commissioned for a paint job and coming in with a new train, but that’s what happened. And he got the job. The InterCity 125 became the archetypal high-speed locomotive, its sleek nose and simple lines still influential today, over 40 years since it was designed.

When I later ask which of his designs he is most proud of he tells me: “The train still takes some beating. There’s nothing like having to live with your designs and it sounds arrogant but there’s not much I would change about it today.”

Grange is still active but his designs are smaller in scale and for far smaller, design-conscious British manufacturers. The huge British consumer product industry with which he made his name has come and gone, virtually within the span of his career. Grange has eschewed the neophiliac, burgeoning world of “design art”, instead concentrating on functional products. How does he view the world of contemporary design and production? “The problem is that it all begins – and ends – with the manufacturing base. And we don’t have a manufacturing base any more. I’ve always admired the Germans for governmentally supporting manufacture but British culture is different, it’s buccaneering. It’s highly paid managers manipulating finance. It’s a completely different model.”

We begin to wrap up, flicking through images of endless designs, many still unfamiliar to me even though I thought I knew his oeuvre well. “I’ve been lucky,” he says. “Design education now is big business [he is also Visiting Professor at London’s Royal College of Art]. There are all these young designers coming out of colleges now and what are they going to do? The big corporations don’t even have design departments like they used to. Some of the kids will fall by the wayside, others are virtually forced into producing one-offs and that way design inevitably becomes a kind of art.”

Can design really be art? “I think design in its highest form can be art. The work of the great Scandinavians – think of Arne Jacobsen.” He starts deftly sketching Jacobsen’s stainless steel Cylinda Line coffee pot. “Look at that,” he says. “It’s sculpturally, graphically perfect. It’s comfortable and it works, you couldn’t make it any better and that takes exceptional skill. Or,” he grins, “it could just be the most amazing accident.”

‘Kenneth Grange: Making Modern Britain’, Design Museum, London July 20-October 30. www.designmuseum.org

..................................................

Works by Kenneth Grange: Part of the British landscape

Many of Kenneth Grange’s creations are so integral to British life that we hardly notice them as pieces of self-conscious “design” – which may, of course, be the highest compliment one can pay to an aesthetically pleasing object or machine whose form and function mesh seamlessly. The pleasing lines of British Rail’s 125 train (1968), the London taxi updated in 1997, sleek lamps, irons, washing machines, cameras and chairs for well-known manufacturers are all part of his repertoire.

Copyright The Financial Times Limited 2011.

FT: Zara, Inditex

Inditex breaks new ground for seasons in the south

By Miles Johnson in Madrid and Andrea Felsted in London

Published: May 22 2011 21:50 | Last updated: May 22 2011 21:50

Inditex, owner of the Zara fashion chain, has become the first global retailer to sell fashion lines designed especially for the seasons of the southern hemisphere as it continues its expansion into markets in Latin America, Australia and Africa.

This year the group surpassed the 5,000-store mark, after opening 30 Zara stores in Brazil, and launching its first store in Australia in April. It plans to open in South Africa this year.

EDITOR’S CHOICE

Inditex keeps its finger on the pulse - May-22

Investors relieved as Inditex profits soar - Mar-23

Ortega passes Inditex baton to Isla - Jan-10

Inditex bolstered by push into Asia - Dec-15

Inditex profits up 68% in first half - Sep-22

Inditex returns to double-digit sales growth - Jun-09

The company, based in Galicia in northern Spain, overtook rivals Gap and Hennes & Mauritz to become the biggest clothes retailer by sales in 2008, and is opening stores at a rate of 10 per week, or about 500 per year.

But for clothes retailers based in the northern hemisphere, the seasons of the south have traditionally presented a barrier to full globalisation because of the complexity of producing specially-tailored winter lines at the same time as summer wear.

“We need a specific collection [in the southern hemisphere] because of the seasons,” Pablo Isla, Inditex chairman, told the Financial Times.

“That is why we need a different collection in order to deal properly with these markets. They don’t want last year’s stock because they follow fashion trends as much as everyone else. If you try to sell them things from the previous season, that never works.”

H&M and Gap, Inditex’s principal rivals, do not have fully integrated operations across the southern hemisphere. Gap has two franchise stores in Australia.

Inditex is rare among international retailers in that it produces the bulk of its clothes in its home market, having eschewed the cheaper labour of Asian factories favoured by rivals.

In the year to January 2011, net profits increased by 32 per cent to €1.7bn ($2.4bn) in a period in which clothes retailers have been hit by rising raw material and labour costs and dwindling consumer spending in western Europe.

Société Générale forecasts a 1 percentage point decline in Inditex’s gross margin in the year to January 2012. That compares with a 3.5 percentage point decline at H&M and a 2.3 percentage point decline at Primark, the UK-based discount fashion retailer.

Inditex manufactures 49 per cent of its products in Spain, Portugal and Morocco, and 35 per cent in Asia. In comparison, H&M sources and produces 75 per cent of it products from Asia.

The Spanish group is expected to open a further 120 stores in China this year, taking in Zara and its other brands, which include Massimo Dutti and Pull & Bear.

Last month Inditex purchased a store on New York’s Fifth Avenue for $324m, in the most expensive US property deal by square foot on record.

Copyright The Financial Times Limited 2011

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Inditex keeps its finger on the pulse

Published: May 22 2011 16:35 | Last updated: May 22 2011 16:35

When Kate Middleton stepped out of Buckingham Palace in a blue summer dress from Zara the day after the Royal Wedding in April, staff at Inditex headquarters were prepared for a stampede of shoppers seeking the same item.

The week before the wedding, an excited Zara manager had spotted Ms Middleton in his store trying on the £49.99 dress, phoning in the information to the shop’s parent company in Galicia in northern Spain.

EDITOR’S CHOICE

Investors relieved as Inditex profits soar - Mar-23

Ortega passes Inditex baton to Isla - Jan-10

Inditex bolstered by push into Asia - Dec-15

Inditex profits up 68% in first half - Sep-22

Inditex returns to double-digit sales growth - Jun-09

Lex: Inditex - Sep-22

This tip, one of thousands of real-time reports on changing tastes and demands which are sent back from Zara shop floors globally, meant that after the bout of Middleton-inspired frenzy saw the dress sell out, more could be manufactured and shipped within two weeks.

In an industry used to bulk ordering fashion lines six months in advance, it is Inditex’s ability to respond quickly to changing trends – with new designs leaving the studio and arriving in one of its 5,000 outlets within a fortnight – that has seen it grow from a bathrobe factory in A Coruña to the world’s biggest clothes retailer by sales since its founding in 1975.

It is a “like a machine”, says Andrew Hughes, UBS analyst. Last year it threw off €1.73bn ($2.45bn) of net profit, an annual increase of 32 per cent, while rivals such as Hennes & Mauritz, which produce the bulk of their clothes in Asia, have been hampered by rising labour and raw material costs in the region.

Founded by the reclusive Amancio Ortega, Inditex refuses to use advertising to promote its fashion lines, or “concepts”, which have grown organically to eight, including Massimo Dutti, Pull & Bear, and Oysho, as well as the original Zara label.

The 75-year-old Mr Ortega, Spain’s richest man, stepped down as chairman this year in favour of Pablo Isla, the company’s chief executive for the past six years. Inditex stands out for the fact it still produces 49 per cent of its clothes in what the company terms its “proximity” (Spain, Portugal and Morocco), with 35 per cent in Asia and 14 per cent in Italy and Turkey. H&M, sources 75 per cent of its products from Asia.

While input costs can be higher, Inditex’s business model allows it to match supply with demand in a way its slower competitors cannot, meaning products can be sold for more.

Store managers hold daily staff meetings to discuss hyper local trends, such as which colour of pastel trousers are selling well in Dubai, or what hemlines are appealing to the women of Bogotá, information which is then fed back to headquarters.

“If you have a pair of beige trousers, perhaps the price would be under €15. If they are in the hot colour of the season, the price may be €30,” says Mr Hughes. “Fashion trends can be much more important than commodity costs”.

Yet when Inditex floated in 2001, with Mr Ortega retaining 59 per cent of its shares, financial analysts initially doubted the sense of manufacturing at home when rivals were rushing to take advantage of cheaper costs in Asia.

Mr Isla argues Inditex’s business model is proving itself as retailers grapple with weak consumer confidence against the backdrop of their own costs rising.

“Proximity sourcing is extremely relevant to us, to be able to react during the season and to maintain flexibility,” he says. “In the last nine months, with raw materials price increases, with cost increases in different Asian countries, it’s clear that in our case it has had much more of a limited impact because of our sourcing and structure.”

Inditex employees, too, say the company’s key strength is its roots as a manufacturer, meaning a cultural emphasis on logistical efficiency epitomised by its base on an industrial estate outside of A Coruña, where thousands of garments a day are sewn, ironed and shipped.

“It has been possible for us because it has been a step-by-step process,” Mr Isla says. “If you try to copy someone else’s business model and it is not part of the culture of the company then it is very difficult to be successful.”

However, Inditex’s rampant expansion has caused some analysts to question its sustainability.

Anne Critchlow at Société Générale also makes the point that Inditex has not been immune to the pressures weighing on rivals. It suffered flat sales from stores open at least 12 months in the years ending January 2009 and January 2010, while in the preceding years, like-for-like sales growth had been “very consistently mid-single digit.”

Others question whether the effectiveness of Inditex’s model is being eroded by the fact that other retailers are sourcing closer to home. One retail analyst says that although Inditex undoubtedly benefits from its sourcing structure, it is “not to the extent that the myth supports. Suddenly everyone is starting to rediscover proximity sourcing because the cost differential has narrowed.”

But Mr Isla remains bullish, arguing Inditex’s low market penetration in China, Korea, India, Russia, Poland – leaves room for growth. “If you are asking me if in the next 10 years we can maintain this growth, I would say: ‘Without a doubt’.”

Copyright The Financial Times Limited 2011.

FT: New rich a blessing for Vicenza’s artisans

New rich a blessing for Vicenza’s artisans

By Rachel Sanderson in Milan

Published: April 15 2011 19:02 | Last updated: April 15 2011 23:26

Vicenza, the northern Italian art town, is learning that what China’s industrial might takes away with one hand, its rapacious consumers give back with the other.

The city, once the world’s gold manufacturing capital, has been devastated by record gold prices and competition from cheaper Chinese manufacturers.

EDITOR’S CHOICE

Bottega Veneta expands with bags of ambition - Apr-15

Blog: Material World - Feb-25

beyondbrics: China - Aug-31

Hermès looks to sell Gaultier shareholding - Apr-01

Prada in HK float plan as demand surges - Apr-01

LVMH signals continued pursuit of Hermès - Mar-31

Where 10 years ago Vicenza was home to 1,300 gold jewellery manufacturers, there are now 600.

In some areas of town unemployment among women, who have borne the brunt of redundancies, is as high as 90 percent.

But while Vicenza’s gold workers lose their jobs to cheaper labour in China and shutter their laboratori, another Italian industry is rushing to hire them.

Makers of luxury leather handbags, costing as much as €75,000 (£108,000) each, are struggling to satisfy Chinese demand.

Their new employers include Bottega Veneta, the luxury goods group owned by France’s PPR group.

Bottega Veneta is based in Vicenza, and the signature woven intreccio infilato technique with which it designs handbags is traditional to the surrounding region, Veneto.

“We saw an opportunity in the gold industry to create better production capacity at the level we want,” Marco Bizzarri, Bottega Veneta chairman and chief executive, told the Financial Times. “We didn’t want to delocalise because the people here have amazing talents and they just lost their jobs.”

Mr Bizzarri, with the agreement of Luca Zaia, president of the Veneto region, has set up a co-operative employing women formerly employed in Vicenza’s gold industry and retraining them as leather weavers for Bottega Veneta.

“[The co-operative] has given a depressed zone the impetus to start up a business and the women the opportunity to look to their future with hope,” said Mr Zaia.

With another co-operative planned, the group is on the way to doubling its production capacity.

At present, the 100 white-coated artisans in Bottega Veneta’s Vicenza factory cannot weave fast enough to keep up with sales over the past two years, as demand from emerging markets surges.

Sales of luxury goods are expected to rise 8 per cent annually until 2015 on the back of demand from consumers in China, Brazil, Mexico and Russia. Bottega Veneta has been a niche brand for PPR, and a smaller sibling to big sister brand Gucci.

Customers are willing to pay a handsome premium for the company’s logo-free but costly products. Part of the allure is that production is limited. Goods are 80 per cent made by hand and produced only in Veneto.

“Made in Italy is an absolute must for us,” Mr Bizzarri said.

“Our customers expect it and clustering our business helps our distribution.”

Copyright The Financial Times Limited 2011.

ST: THe Minimalist Man of Muji

Wed, Mar 02, 2011

The Straits Times

Minimalist man of Muji

by Tara Tan

Kenya Hara, creative director of popular Japanese lifestyle brand Muji, pretty much looks the way you would expect him to.

He wears a dark blue linen jacket over a black T-shirt, with no jewellery adorning his hands.

The matt silver frame of his intriguingly shaped sextagonal spectacles matches his salt-and-pepper hair.

Simple, functional and very down-to-earth, the man behind Muji's minimalist ethos lives the lifestyle he designs for millions of fans around the world.

'In Japan, there is the concept of looking for beauty within emptiness. It is a unique aesthetic, one which is against the complexities of the world,' says the 51-year-old Tokyo-based designer through a translator.

He was in town last week to conduct a public lecture at Lasalle College of the Arts.

But within that emptiness lies an immense variety of possibilities, he adds.

Employing a 'no-brand' philosophy as its identity, Muji - founded in 1980 as a product line under supermarket chain Seiyu - produces stationery, kitchenware, clothing and furniture, all espousing no-frills design, low prices, simple packaging and environmental awareness.

It has 342 stores in Japan alone and 98 stores beyond, including 14 in Britain, four in the United States and eight inHong Kong.

There are four outlets in Singapore, located in Bugis, Paragon, Ion Orchard and Marina Square.

Hara, who became Muji's art director in communications in 2001, is considered one of the leading thinkers and designers in Japan.

Apart from curating the lifestyle and brand identity for Muji, he lectures at the prestigious Musashino Art University.

He has also published books, including Designing Design (2008), an authoritative tome that showcases iconic creations from Japan.

A deadpan sense of humour belies his reserved, if somewhat aloof, demeanour.

He jokes about trying to smile without showing any teeth during the photoshoot, and about the irony of living a life of simplicity while his wife has a passion for dramatic, outlandish theatre.

For the cerebral designer, who has a 25-year-old son, design forms the backbone of contemporary society.

He talks about the impact small things have in everyday life, which can often be overlooked.

He says: 'Think about drinking mineral water. Drinking it straight from the bottle is different from drinking it from a cup or scooping it up from a plate using a spoon.

'Designers need to think about the many different aspects of the same thing.'

After all, this is the man who roped in prominent Japanese architect Shigeru Ban to re-think the humble toilet roll, which is featured in Designing Design.

Ban came up with a square-shaped toilet roll on the philosophy that the thunk-thunk sound that came from unrolling it reminds the user to be mindful of wastage.

And, hey, it also stacks better.

Hara often cites Japan's cultures and traditions as the origins of design, adding that the pervasive 'concept of emptiness' will continue for the next 50 or 100 years.

But the deeply philosophical man isquick to distance himself from philosophy.

He says: 'Calling design a philosophy is an exaggeration. I don't think design should be philosophised, it should be about the every day.'

taratan@sph.com.sg

This article was first published in The Straits Times.

more: muji, minimalist, creativity, lifestyle

FT: Dream built on the right foundation

 

Dream built on the right foundation

By Rebecca Knight

Published: February 15 2011 22:01 | Last updated: February 15 2011 22:01

As a girl, Mally Roncal spent hours beside her mother’s elegant dressing table watching as she carefully powdered her face, dabbed rouge on her cheeks, delicately lined her lips and spritzed herself with perfume. “I was always attracted to glamour and beauty,” says Ms Roncal. It was perhaps the formative experience of her childhood. Ms Roncal, 39, is the founder of Mally Beauty, a New York-based cosmetics company, which last year had sales of more than $50m.

Ms Roncal developed the line after a decade of working as a make-up artist to famous models and actresses, such as Heidi Klum, Beyoncé Knowles, Jennifer Lopez and Angelina Jolie. Frustrated by lipsticks that bled, foundations that wore off easily and concealers that did not conceal, Ms Roncal created her own. She focused on normal women, most of whom do not reapply their make-up during the day. “The answer was to create a high-performance make-up line that didn’t need to be reapplied constantly,” she says.

Mally Beauty sells more than 92 products – from a set of blushers named Partylicious to a compact of eye shadows called City Chick Smolders – all pledging to help give everyday women the kind of polished appearance seen in glossy magazines.

Over lunch at a fashionable Greek restaurant in midtown Manhattan, Ms Roncal has a livewire personality but speaks in serious tones when discussing her business. She admits her life’s work is not noble or high-minded but also insists it is not frivolous, since cosmetics play an important role in women’s lives.

Ms Roncal herself has film star good looks: a honeyed mane, dewy cheeks and perfectly plumped pink lips. Raised in upstate New York as the only child of Filipino immigrants, her upbringing was typically Filipino, she says – “our house always smelt of fish sauce” – but her parents em­braced the idea of her “achieving the American dream”.

They were both doctors and Ms Roncal, too, was earmarked for medical school. But when she arrived at Marist College in Poughkeepsie, New York, she soon switched her focus to fashion design. After graduation, she moved to New York City to work for Kalinka, the designer. The pay was meagre but it was her entry to a world of celebrities and designers, including Phil Bickett, a former model who later became her husband.

Ms Roncal also worked part-time at the Shiseido make-up counter at Barney’s, the luxury department store, where she studied the ingredients on product labels and pored over trade magazines.

“It was my calling,” she says. She also took every make-up artist job going, from unknown rappers making videos to small-time models on photo shoots. “I never said no to a job. But after a while, I realised this is my business and I had to learn how to negotiate.”

At 24, Ms Roncal signed with Jim Indorato, the hair and make-up artist agent, and spent 10 years travelling the world to do make-up for private clients, including supermodels, singers and actresses.

Getting started: in their own words

Mally Roncal and Don Pettit have complementary perspectives on how to build a company:

Mally Roncal:
●On hiring. “At first it was hard for me to hire other people. I am a perfectionist. But I realised that to grow as fast as we were growing, we needed help. I’m now more able to let go – I know that my employees can do it.”
●On customer service. “I am the face of the brand. I answer every e-mail and I listen when customers give me suggestions. It’s all about communication, so I give my website a lot of time and attention.”

Don Pettit:
●Know your stuff. “You need a deep knowledge of your category, but you have to know the rules you can break ... You need to find a point of difference.”
●Keep your options open. “You need to be able to go to Plan B when Plan A fails. Find a way to get through setbacks productively.”

She was making a lot of money but wanted to start her own business. After all, she knew the world of cosmetics: she had insight into the products, she had relationships with stores, and she had expertise.

Mr Bickett quit his marketing job, they pooled their savings, and friends and family chipped in so her start-up capital was about $800,000. In 2002, they teamed up with Don Pettit, a cosmetics industry veteran, who joined as chief executive to add some different business experience.

“Part of what I bring to the party is a way to channel [her] energy and vision into viable, user-friendly products,” says Mr Pettit, speaking by phone while on vacation.

For two years, Ms Roncal, Mr Bickett – now creative director – and Mr Pettit honed the business plan, developed product ideas and pitched to potential investors. Mr Pettit’s reputation and industry connections – as a founding manager of Jane Cosmetics, which was eventually sold to Estée Lauder – helped win Mally Beauty contracts with big suppliers even though it was just a small start-up.

He also helped Ms Roncal on formulating suitable lines. “We intentionally focused on products that are in ‘high loyalty’ segments, such as mascara and concealer ... Lipsticks are one of the lowest loyalty products,” he says.

Ms Roncal was also thinking about her market. QVC, the home shopping network, was where she wanted to unveil Mally Beauty, whereas traditional cosmetics launch­es usually targeted retailers such as Sephora or luxury stores such as Neiman Marcus or Saks. At the time, QVC had a homey, unglamorous image.

But Ms Roncal knew many women wanted advice on applying make-up and that would be the key to sales.“I wasn’t just selling a product – I was selling a technique and teaching new ways to apply make-up,” she says. “To me, selling on television was the future of make-up, even though people in the cosmetics industry and my friends in the fashion world thought we were out of our minds.”

In 2005, Ms Roncal introduced a line of eight products packaged in ballet slipper-coloured boxes. During her 60-minute launch show, the merchandise sold out with 20 minutes to go, making it the most successful launch on QVC until then. The high-end department store Henri Bendel signed her to an exclusive contract. “We came out of the box on fire,” says Ms Roncal. “We were selling, and it felt easy.”

Perhaps a little too easy. Ms Roncal rushed out a line of lipsticks and eye shadows and secured a second slot on QVC. But this time she flopped because the products “didn’t have a story or a meaningful difference”, she says. “It was humbling, and it scared me.”

She and Mr Pettit, who has a third of managing equity in the company, then raised about $1m from an angel investor to develop differentiated products, including a professional-grade eyeliner and a concealer. They persuaded QVC, where sellers’ success is judged by dollars per minute, to give her another shot. This time, she sold more than 100,000 pieces.

In its first year, the company brought in $5m. Last year, sales – which mainly take place on QVC America and QVC UK – grew by nearly 100 per cent. QVC will always be a pillar of its sales but “infomercials” are in­creasingly important as a way to tell a story about the product.

Ms Roncal and Mr Pettit have a very close partnership, he says. “We disagree at times but we are highly agreed on the strategy to date, which is to build a direct relationship with loyal users.”

Neither of them has an exit plan, so far. “We’re not sitting around wondering how we can sell this business,” he says. “We don’t have capital pressures and we have a lot of options for continuing to grow this for as long as we want. That said, it doesn’t mean we wouldn’t entertain a joint venture that would improve the brand and serve our user base.”

Copyright The Financial Times Limited 2011.

FT: Web offers a comfortable fit

 

 http://www.ft.com/cms/s/0/448936f0-f750-11df-8b42-00144feab49a.html#ixzz16PFry5kw

Web offers a comfortable fit

By Mina Hanbury-Tenison

Published: November 23 2010 23:16 | Last updated: November 23 2010 23:16

An obstinate streak: Wu Fangfang refused to sell her Miss de Mode brand when the financial crisis struck

 

Two days of record sales are a cause for celebration and Wu Fangfang, founder of Shanghai Qianrui Garment Company, is all smiles.

She is also frantically busy. A two-day online sales event, which was hosted by Taobao Mall, the business-to-consumer online marketplace, has brought in more than 100,000 orders and Rmb10m ($1.5m) of sales.

At a desk in her offices in the Shanghai suburb of Minhang, the elegant 35-year-old chief executive is arranging for 200 garment workers at her new factory to work all hours to fulfil the orders, while she also updates the US-based venture capital investors who have just put in second-round funding of $10m. Sales projections for 2011 for her popular children’s clothing brands Miss de Mode, MILBoy (Made in Love Boy), and Jenny Bear have risen to Rmb250m.

It seems that Ms Wu’s gamble of switching from bricks-and-mortar ret­ail outlets to online-only is paying off. Taobao Mall is part of Alibaba, the Chinese e-commerce group, and Ms Wu was honoured in September as one of Alibaba’s best “netrepreneurs” at the company’s annual Alifest summit for entrepreneurs.

“We are now at a point that we’ll lose money if we do less than Rmb2.5m in sales every month,” she says.

Yet just two years ago, Ms Wu was fending off creditors and being pressed to sell her business at a firesale price. But, she says, fast reactions and the courage of her convictions helped her to make the switch to online that has proved so successful.

In addition, she has an obstinate streak, having more or less earned her own living since she became a fashion model at the age of 13 following her parents’ divorce.

When the financial crisis first hit, she says: “I didn’t panic ... I used the situation to coolly evaluate my business model and decided that, over the long term, I will be fine because children’s clothes and e-commerce were both growing sectors in China.”

At that time, Ms Wu’s company owned just one clothing brand, Miss de Mode for girls, which she had started in 2005. Her company des­igned, manufactured and promoted the clothes, which were sold through a network of Miss de Mode retailers. Sales had grown quickly, with the number of stores increasing from 30 to 107 in just two years.

When a crisis threatens

When Wu Fangfang’s business was nearly sunk by the financial crisis of late 2008, she learnt some lessons on how to deal with uncertainty.

●Maintain confidence: “Every day I made sure that I smiled in front of my staff. I wanted them to know that we were going to survive the crisis and I was 100 per cent optimistic.”

●Talk to creditors: “I met all my creditors face to face. [With] some creditors, such as factories that were far away, I took the time to visit them. I told them personally that I would pay back in a year’s time. I told them I would never run away and I would never let them down.”

●Keep your integrity: “Many people at that time started picking fault with shipments of clothes and sent them back to the factory to get out of paying – we didn’t do this.”

●Inform your staff: “We met every two, three days and I would tell them any good news, however small and insignificant. I would say, ‘We made Rmb50,000 today,’ which was not very much, but sounded uplifting at the time.”

At the start of 2008, all the retailers asked Ms Wu to increase output. “They told me this fall/winter season is going to be very good ... But when the [financial crisis] struck, they abandoned more than half of their order,” she says. Most of the stores reneged on their contract to buy more products.

Ms Wu could not sue each retailer, but she also could not sell the clothes anywhere else as she had no other sales outlet. She had to swallow the loss, representing Rmb12m that year, while sales continued to slow.

It was a rude awakening for Ms Wu. Creditors started calling at the company’s offices. An entrepreneur from the city of Wenzhou, where her brand was popular, offered to buy the Miss de Mode brand and her stock for Rmb2m.

Take the deal, her mother urged – at least she could recoup some of her original investment. “But this brand is like my child. I couldn’t possibly give it up,” says Ms Wu.

Many of her 30 staff were supportive. One even suggested that she pay the workers shenghuofei – basic living costs – for two months, but Ms Wu felt it was vital to maintain salaries.

However, she did accept a loan from her office assistant, who refinanced her apartment to help Ms Wu pay outstanding bills. With that and by refinancing two of her own apartments, Ms Wu raised Rmb2.8m to stave off creditors.

She did not bother to ask the banks. “It’s almost impossible for small, private businesses to get a loan in China, unless you have guanxi [connections],” she explains.

With sluggish cash flow and a pile of unsold stock, Ms Wu had to find another sales outlet fast. Luckily, Taobao.com, the Chinese e-commerce site, had just launched Taobao Mall. She was already familiar with the group: in fact, it was Taobao that had inadvertently prompted her to start the Miss de Mode brand.

When the Chinese site took on Ebay China in 2005, Ms Wu was running a small wholesale garment and design business that sold its products on Ebay China. Friends in the business would call her when extras left over from an export clothing shipment were available. She and her small design team would collect the items, add extra flourishes and sell them.

When Ebay China closed the following year, Ms Wu developed Miss de Mode into a brand that sold through bricks and mortar retail outlets only. “At the time Ebay users like me looked down on Taobao. It was known for selling cheap things,” she says.

Nonetheless, her loyalty to Ebay was waning. She felt it had made mistakes in China: it was too slow; PayPal did not work in the country; and it had hired a lot of foreigners who did not understand the Chinese market. By contrast, “Taobao had Alipay [Alibaba’s online payment system], it offered instant messaging and it was free”.

So, when the financial crisis struck, Ms Wu decided to use Taobao.

New ventures rarely run smoothly, but one of her problems came from an unexpected quarter: some of the original Miss de Mode retailers. Sales had yet to pick up on Miss de Mode’s online shop on Taobao Mall, when Ms Wu was shocked to receive a demand from 70 of the stores, including some that had reneged on their contracts, for her to close her online outlet because it was affecting sales of the remaining stock.

Again, Ms Wu turned to her staff for their opinions. Many said to close the Taobao store down: online sales were still a small proportion of overall revenue and they had spent three years building the store network. But Ms Wu saw it differently: “I told them we held the key of e-commerce in our hands now and we should use it.”

She decided the Miss de Mode brand would be sold online-only as soon as possible. In 2009, when the last of the “franchisee” contracts expired, Ms Wu halved the online prices, which had formerly matched those in-store. By the end of May, Miss de Mode had Rmb500,000 of sales. Ms Wu launched two more children’s lines – MilBoy, which is now outselling Miss de Mode, and Jenny Bear.

 

Ashort car journey from her offices, Ms Wu shows off the three floors of the new 4,000 sq m factory and warehouse in Songjiang District. She believes it is important for the company to have its own factory: “We can res­pond to the market and needs very quickly. Less than 6 per cent of our stock remains unsold.”

However, fast growth has brought new challenges. Overall costs have gone up. Ms Wu has had to hire staff very quickly: the design team now has 60 people; the fulfilment and e-commerce centre has another 120; and the new factory has hired nearly 200 garment workers – the ones racing to fulfil the extra orders.

“It’s getting harder and harder to find people ... but the fact that we have a venture capital partner and that we’ll eventually have an initial public offering will make our company more attractive,” says Ms Wu. The intention is to list in 2014, either in Hong Kong or the US.

“We faced the worst hardship in 2008 so from now on, I feel that we can face anything,” says Ms Wu.

 

 

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FT: E-books, Classroom

E-books fail the classroom test

By Paul Taylor

Published: September 5 2010 18:59 | Last updated: September 6 2010 10:19

 

Business school students give Kindle the cold shoulder

Business schools pride themselves on being ahead of the curve when it comes to management theory and innovation. But their record is considerably less impressive when it comes to the implementation of cutting-edge technology such as e-book readers, Apple’s iPad and social networking, where students continue to outpace their tutors.

So expectations were high a year ago when seven US colleges, including two business schools, University of Washington Foster School of Business and the University of Virginia’s Darden School of Business, signed up with Amazon to test the online retailer’s large-screen Kindle DX e-book reader.

Some even thought that with students able to load class materials and textbooks easily on to the 10-ounce device, the era of lugging textbooks around campus might finally be over.

Of the seven schools that participated in the Kindle pilot, Darden worked most closely with Amazon to convert many of the case studies it uses in first-year classes to the Kindle format, and selected 62 students and 10 faculty members for the pilot.

But while students liked some of the Kindle’s features, such as the big screen and the ability to store hundreds of case studies and books on the device, most were unhappy overall with the user experience, says Michael Koenig, Darden’s director of MBA operations.

Although the device allowed students to highlight text and make notes, many complained that it was difficult to use these features and said the Kindle was more suitable for casual reading than for the classroom.

In fact, by the second semester, most students had abandoned their Kindles, choosing instead to read case studies on their laptop or on paper. In a mid-term survey, the pilot scheme participants were asked: “Would you recommend the Kindle DX to an incoming Darden MBA student?

“A total of 75-80 per cent answered ‘no’,” says Mr Koenig. Kindle-using students were then asked: “Would you recommend the Kindle DX to an incoming MBA student as a personal reading device?” A total of 90-95 per cent said “yes”.

“What that says to me is that Amazon created a very well-designed consumer device for purchasing and reading digital books, magazines and newspapers,” says Mr Koenig. However, he believes it is not yet ready to take a lead role in the Darden business school classroom.

But Mr Koenig insists the trial was informative. “We learnt a lot and are much more prepared as a top-tier business school to face the complex challenges of digital content distribution for all future Darden students.’’

For the moment he believes e-book readers are too rigid for use in the classrooms of Darden, where the Socratic method and case-based pedagogy mean students must be nimble.

“You must be highly engaged in the classroom every day,’’ he says, adding that the Kindle is “not flexible enough ... It could be clunky. You can’t move between pages, documents, charts and graphs simply or easily enough compared to the paper alternatives.”

Daniel Turner, associate dean of the masters and executive education programmes at Foster, expresses similar views. “It’s not quite ready for prime time in higher education.”

Meanwhile, some business schools, particularly those that are smaller and more innovative, have switched their attention to Apple’s iPad launched this year.

Among them, Grenoble’s Ecole de Management in France will select 40 students this month to be part of an “innovation” laboratory at the heart of the school, aimed at testing, among other innovations, the pedagogical advantages of the iPad.

“The iPad is perfectly suited in terms of its vast experimental learning capacity,” says Béatrice Nerson, deputy director at Grenoble. “We want to imagine new ways of making use of it.”

Grenoble plans to use the iPad to develop applications, make more intuitive use of its e-book reader capabilities, give access to online classes and distance learning and to provide access to faculty publications via the e-book store. For the past 22 years, Grenoble students have been asked to have a PC. “The question now is to find out whether the iPad will replace PCs,” says Marc Humbert, head of the Innovation Laboratory. “We may find that the iPad is less ‘intrusive’ than a PC, which, when open in the classroom, is like a barrier between the student and faculty.”

 

 

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Economist: iPad - smashing success

Print on the iPad

A smashing success

The iPad is transforming media firms, and frustrating them

Sep 16th 2010

THE advertisement for Newsday’s iPad application starts blithely enough. A man in a shirt and tie sits in the kitchen, reading the New York newspaper on his tablet computer. He turns the device on its side and watches the live feed from a traffic camera. Then a fly lands on the table. The man quickly raises the iPad and smashes it down, shattering the glass. The ad implies that the iPad is superior to old-fashioned print in all sorts of ways, just not every way. It is a joke—but also a good summary of how newspaper and magazine outfits have come to feel about Apple’s product in the eight months since it was unveiled.

Even before the device had a name, media executives knew what they wanted from the iPad. Like the Kindle, Amazon’s e-reader, it could be used to sell digital issues of newspapers and magazines. Like the web, it could be used to deliver targeted advertising. It would look better than both. Newspaper and magazine firms were determined to steer its evolution. Terry McDonell, who oversees Sports Illustrated, helped create a futuristic-seeming video of a hypothetical issue filled with whizzy graphics and interactive ads.

It is a mark of the quality of Apple’s device as well as the efforts at Sports Illustrated that the magazine’s actual app does not differ much from the video. Others have created beautiful applications that are drawing consumers. Wired, a technology magazine owned by Condé Nast, claimed to sell 24,000 downloads within 24 hours, at $5 each. Newspaper and magazine apps are popular with advertisers, who pay up to 10 cents per reader—several times what newspapers tend to charge for web ads—for the privilege of appearing on a sexy new device.

The iPad’s effect on media firms extends well beyond its screen. The device contains a web browser as well as an app store, bringing together the world of paid content and the open web, where print content tends to be free. It is as though a news-stand carried two versions of every magazine—one costly, the other inferior but free. Media firms that were already coming to believe that the web is a mediocre advertising platform have drawn a stark conclusion: they should pull back from the free web.

Time magazine has begun to hold back some stories from its website, on the ground that it is now providing a decent digital alternative. Time Inc is moving towards all-access pricing, in which content is available on all platforms to people who pay for it. This is in line with the “TV Everywhere” plan developed by Jeff Bewkes, Time Warner’s chief executive. Others are likely to follow. James Moroney, publisher of the Dallas Morning News, says the release of a paid iPad application later this year is likely to coincide with the erection of a paywall on the Dallas.com website. It is illogical to charge for one but not the other, he says.

Yet obstacles lie in the path of media firms that want to move in this direction. The first is that many print publications do not have enough information about their customers to enable them to sell across platforms. Ken Doctor, a media analyst at Outsell, points out that American newspapers tend to sort their readers by address rather than by name. The second obstacle is Apple. The firm has made it difficult to sell subscriptions on the iPad, and is reluctant to disclose much data on buyers. This is a particular problem for magazine firms, which use customer data to push other products and to sell advertising.

Apple’s device is proving both transformative and deeply frustrating. Media firms are praying that another device, perhaps using Google’s Android operating system, becomes popular and gives them leverage over Apple. Much as they love the iPad, they would gladly smash a few if the thing could be replaced by another, equally compelling, tablet computer.

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