Michael Schaffer offers specialty stores nursery Creations

Industry Faces

By Tanya K. Merritte -- Kids Today, 9/1/2009 12:00:00 AM

Who: Michael J. Schaffer, president, Creations

Background: Schaffer says that he ended up in the juvenile furnishing industry by accident. He had worked at Simmons' mattress division during a summer break from college and after two years as an Army officer, he was preparing to attend law school. Mike Brunner, then president of Simmons Juvenile Products, contacted him about a sales rep position and he ended up taking over the Southern California territory. "(He) made me an offer I couldn't refuse," Schaffer said.

Schaffer rose to vice president of marketing and sales before leaving the company for a stint in the home furnishings industry. He also briefly opened his own upscale furniture business. But by 1992, he says he realized he missed the kids industry. That year, he bought a company called Lullabye; however, the company ended up closing and Schaffer liquidated it, but retained the intellectual property rights. In 1995, he talked to Simmons about rejoining the company, but ended up at Child Craft as "vice president of everything nobody wanted to do," he recalled jokingly. In 2003, Schaffer was named president of Baby's Dream.

Creations' April Collection in Espresso. Shown is the crib, nightstand, chest, combo dresser and hutch. Retail price is about $1,840.

Schaffer said by 2006, he was thinking of starting his own company again — this time in the juvenile market. Around then, he was introduced to George Revington, head of Home Meridian International, which owns Pulaski, SLF and Samuel Lawrence Hospitality. "He said, 'Let us help you do it,'" Schaffer said, and Creations was born. The company produces classic cribs and nursery furniture in the medium to medium-high price range that is sold exclusively to independent specialty stores.

The process: Schaffer said design ideas can come from different sources, including himself or the independent furniture designers that work on the Creations line. Schaffer said he gets much of his inspiration from the adult furnishings business.

"Typically, people who buy baby furniture bought their own furniture two or three years before," he said. He explained it's important to stay in-tune with the adult market because parents tend to bring that same style into the nursery.

Work on the new collections usually begins in February or March. Schaffer said he then brings in top dealers for an early viewing to see what they like and don't like. The designs are tweaked and sent to the company's factory abroad for samples to be made in time for September's ABC Kids Expo, which Schaffer helped found in 2003. Creations also shows at ABC's Spring Education Conference, which debuted in May.

Schaffer said Creations' uniqueness stems from its innovation and style. The company also intends to remain exclusive because it only sells to independent specialty stores that make a full commitment to the line. He said the line tends to be very profitable for retailers, explaining that stores are able to have a better profit margin because there is less direct competition from other area retailers. Creations is also able to get a better rate on containers, which translates into better pricing, he added.

Creations currently sells to around 130 owners, some of whom own more than one store. Schaffer said he wants to add more dealers where it makes geographic sense.

The challenges: Despite the economy, Schaffer said Creations has managed to grow, mainly by taking business away from its competitors. He said one of his biggest challenges in handling growth has been managing the supply chain. After having production spread among three plants in Asia, it has recently been consolidated to a single factory in Vietnam, which Schaffer said should help with quality and reliability.

Creations also has realigned its sales force in the United States, going from two in-house sales managers to six independent sales reps. "We weren't giving enough service because there weren't enough people," he said. By adding four people, Schaffer hopes to bring the line to more qualified dealers around the country.

Another challenge, he said, is the difficulty many independent specialty stores face competing against big-box retailers. To help remedy that, the ABC Kids Expo group (of which Schaffer is a board member) has launched BabyProductExperts.com, a site that links consumers directly to independent retailers in their area and provides a description of services, brands carried and ratings from other consumers, among other information. Stores must agree to be secret-shopped before they are added to the list; so far about 300 stores have signed up.

Baby Product Experts is a sponsor on babycenter.com, a site that is visited by 78% of expectant moms, according to Schaffer. In the first couple of weeks since its launch, BabyProductExperts.com accumulated 6,000 consumer e-mail addresses. The site also offers promotions and sweepstakes, such as the recent giveaway of an entire Creations nursery.

Despite the obstacles, Schaffer sees light at the end of the tunnel. As of the end of August, retailer registration for this month's ABC Kids Expo was running ahead of last year, something Schaffer was very optimistic about. "It's all about retailer attendance," he said.

Beyond the show, Schaffer noted with a laugh that his brother is the economist, but he was cautiously optimistic about what the next year will bring. "I hope the economy will come back — but that's not a prediction, it's a hope."