Burlington Futon Company
A Classic Futon Fairy Tale

nce Upon A Time...

Many of the companies that are currently topping the charts in the futon furniture category have a similar historical background. They started because an individual believed that futons were a great place to sit and sleep, and this person wanted to share this new found treasure with the world and maybe make a few bucks too. The movers and shakers of many of these companies had little or no business experience to speak of, other than what they had picked up over the years from jobs that they had worked during high school or college. Mark Binkhorst of Burlington Futon is a classic example of this phenomenon. "It all started with fourteen futons and a U Haul trailer," said Mark Binkhorst, President of Burlington Futon Company, who then told us his now famous story with the Stella Doro connection.

"It was 1983. I had parked my car in front of McSorley's, a rather famous bar in New York city. When I walked out to leave, the car was not where I had parked it. It had been hit and pushed down the street a bit. The person who caused the accident, coincidentally also named Mark, happened to be my age and his family owned the Stella Doro Biscuit Company. I went back to Vermont and had the car looked at and got a repair estimate at a local body shop. I sent the estimate in and left for the summer. When I returned in the fall, there was a check waiting for me for $1,000.00, just what I had requested to repair the car. I took the money and bought $964 worth of futons from Charette Futon in Boston. I hooked up the U-Haul trailer to the Volvo, went down there and came back with fourteen futons," said Binkhorst. He then set up shop in a friend's basement, where he intended to sell off the futons for extra income while he prepared to begin the process of finding a job. "I had just graduated from the University of Vermont and wanted to start a career in international diplomacy and finance. I had no idea that I would become involved in the furniture industry," he said

After selling a couple of futons to his friends, and due to a damp basement, Binkhorst was forced to move into a vacant store front. "I figured I would sell all the remaining futons and then head out to some interviews and get a real job. I put up cardboard signs all around the UVM campus saying, 'Futons $99'. By the end of the day, I was sold out," he said. Instead of going on to the interviews, Binkhorst cashed the checks and headed back to Boston for another trailer load of futons. "I did this several times over the next few weeks, and eventually had to get a bigger truck. The futons were selling as fast as I could stock the store." The little business continued to grow to the point where Binkhorst was selling one hundred futons a month. "I was paying $65 each for the futons and selling them for $99. I had almost no overhead and I was making money."

For the next seven years, the Burlington Futon Company grew with a focus on retail. It was the eighties and things were looking up. Binkhorst added frames (W. M. Brouwer) and began making his own futons and covers.

"When we decided to make our own futons, we went to visit Barry Sherman of Worcester Fiber. We liked his cotton, he liked us, and we bought a tractor trailer load (18,000 pounds) of cotton batting. We had never actually made a futon, but we learned quickly. I even went down to the New York garment district and learned a lot by just asking questions." Binkhorst told a story about a man he calls his fairy godfather who just showed up one day and offered to sell him a cutting table and a fabric cutting knife for $200. It was during this time that the company moved to its present location on Pine street. The large brick building with maple wood floors once housed the "Vermont Maid" maple syrup plant. Significant renovations have been made over the years, but the building has always afforded the company room to grow.

They Came To A Fork In The Road

Things were going well for the young retailer. Then, as it happens in most success stories, there is usually a significant turning point where major decisions have to be made. "It was 1990 and we were ready to open a second store in Portland Maine, but it never happened. The T-shirts were printed, and we were ready to open, but I just couldn't negotiate a good lease. The landlord started to add all these strange conditions, and it just didn't work out." Shortly thereafter, the economy in New England took a nose dive, and the future of retailing looked bleak. "At this point," states Binkhorst, "I was concerned for our very future. The company had grown to include 12 people who depended on Burlington Futon for their livelihood. We had all worked hard to build the company, and we were dedicated to this emerging industry. We were known locally for making great futon mattresses and really enjoyed working with fabrics. The idea to wholesale these products seemed logical," he said. Due to its size, their relative distance to major markets, and formidable competition, wholesaling the futon mattress itself didn't make sense, so they chose covers. Binkhorst didn't realize it then; but, when he decided to move into the wholesale futon cover business and not expand the retail side,, he would soon be radically changing his entire operation.

"Compared to retail, it takes a very different set of skills to operate a competitive, wholesale, cut and sew business," says Binkhorst. "First was the search for sewers, as well as someone who could fix a broken sewing machine - that wasn't easy," he added. Binkhorst soon realized that the margin of error in the wholesale world is much smaller than in a vertically integrated retail business. Binkhorst's strategy also included a calculated risk that has paid off for this creative entrepreneur. "With the economic recession in New England, we decided to take advantage of the downturn and solidify our company's position. We were able to find good people, negotiate a favorable lease, and we were able to buy cutting and sewing machinery for ten cents on the dollar," said Binkhorst. Unlike the rest of the world, the futon furniture business was on a steep growth curve with plenty of new customers to go around, and Burlington got their share.

So with a strong retail store as a base, Binkhorst and company began to move into the futon cover business in earnest. The plan included the following standards: Pay attention to the details - all the covers made at Burlington Futon Company would be of the finest quality and constructed with the tailored look of a fine sofa, utilizing full side panels and a special zipper closure. Offer good customer service and take the time to listen to the customers needs. Research what is happening in the world of fashion and furniture and bring the latest styles to market. Be creative and innovative - always strive to find that little something different that no one else has.

With The Giant Now Tamed
They Settled into Their New Home

"We have two distinct futon cover programs at Burlington. One is a swatch program of reorderable covers," said Binkhorst, who added, "At the Futon Expo in Phoenix, we introduced our new and expanded collection of fabrics." Binkhorst points to three swatch books on the counter in the wholesale offices. "We start out with a promotional book where every full size cover wholesales at $44.50. If you apply the typical industry 2.2 markup, you end up with a retail price of $99 - a price point most specialty retailers feel comfortable with. The second book is a book of solids with a look and feel of quality. It includes brushed cottons, chenilles, and velvets priced 'competitively'," says Binkhorst. The third book is a designer book with a wide price spread ($52.50 to $112.50). "We are aware of the price sensitive nature of this product and have made a concerted effort to introduce the majority of new fabrics in the lower price categories. However, it is difficult to say no to a beautiful, yet expensive, fabric. Interestingly, these fabrics have become some of our best sellers."

"This expanded program is new for our company," says Binkhorst. "We have never carried so many fabrics before, but we are convinced this is the way to go." Binkhorst was very careful to express the fact that excellent quality does not have to mean higher prices. "Our image has been so well crafted that some retailers believe our prices must be higher than our competitors'. In reality, all of our pricing is very competitive. Our swatch books are often in good company with other vendors' books, and many retailers have realized the benefit of offering a large and comprehensive selection."

Burlington also has a custom cover program that has grown considerably over the years. "We have created a department that only works on these special sizes. In addition, we are working hard to continue the progress towards standardization of sizes, as this will make our industry less complicated for everyone," he said.

The assorted program at Burlington is very different from the typical factory select program. The program is directed by Burlington's wholesale marketing department. "This program allows our dealers to get only the assorted covers they want and not have someone else decide for them. We take every fabric available for this program, cut six inch square swatches, and number them for easy identification," said Chris Van Genechten, the wholesale coordinator. "We then send out the swatches on a rotating customer basis to our over 500 wholesale accounts. Our dealers then pick out the fabrics they want, and we usually ship from our finished goods inventory in two or three days. This program has limited quantities of each fabric and is administered on a first come first serve basis."

All of the company's various programs are outlined and, along with a new point of sales tool, are available upon request. "To make our products more user friendly, we have developed a retail price list that is available to all our accounts, customized to their specific pricing structure. The retail price list is an easy to use laminated chart that allows both the retailer and customer to look for a specific fabric and determine its retail price. The retail price incorporates the retailer's markup factor and is rounded off to a retail price."

And They Continue To Work Hard Happily Ever After

"We are an industry leader - that means being a proactive company. We stay on top of what fabrics and colors are selling in traditional and contemporary furniture, then make sure we have these similar styles available for our customers. Our goal is to offer the look and feel that the customer wants. If brushed cottons or velvets are hot, then we will make sure to have them in our line. Our customers expect us to deliver product that sells. If we can provide the right covers to their stores, then we both will benefit from increased sales," said Binkhorst. Burlington Futon sees its relationship with each account as a partnership, working together. Bobbie Moser of the wholesale team states, "We are very receptive to feedback and even constructive criticism - we can always learn how to do it better."

At the risk of being biased, Binkhorst stresses that it is the cover that sells the entire category. "While the frame and futon are equally integral to the total package, it is the cover that completes the perceived value. Merchandising is everything. We are relentless when it comes to dressing up our own store, and we stress constant change with our wholesale accounts. If you were to go to your favorite clothing store and they always had the same merchandise, after a while you would probably start shopping elsewhere. Furniture is no different. People make a habit of coming back if they know they are going to see a new show every time they come into the store, and invariably people buy what they see," he said.

Internally, the company philosophy is based on progressive and socially responsible business principles. In addition to making a quality product and delivering it on time, it is the human element of the company that prevails. "It is the professional and personal relationships that we have developed with our suppliers, coworkers, and customers that make it all worthwhile. The sewn products industry, particularly overseas, has received a lot of negative publicity. We are proud to be able to pay a 'living wage' that is much higher than minimum wage to all our full time employees," he said. In addition, many of Burlington's sewers are refugees from Bosnia, Vietnam, Iraq, and other counties. The company works together with a local agency to teach English as a second language, arrange car loans, and has even succeeded in helping their lead sewer buy a house. "At Burlington Futon, everyone is a valuable asset and a member of the team. Given the small size of the company, we cross train to make the team more versatile. The concept is that we all should be growing and learning to be adaptable as individuals and as a business," said Binkhorst.

While driving back to Providence from the beautiful Vermont countryside, and the college town of Burlington, I thought about what a unique industry this is and what it affords its participants. Mark Binkhorst and company have been able to carve out a great niche for their company, while still retaining all the integrity and essence of what it means to be from Vermont. Rugged individualism, a focus on quality that lasts, and a willingness to give back a part of the profits for the betterment of the community and land.