With a £5m investment set to take it to the next level of omnichannel trading, furniture vertical Arlo & Jacob has come a long way in four short years. Paul Farley caught up with the family-friendly brand’s founder and MD, Nick Wasey, to talk team spirit, tech and turmoil …
A rogue burglar alarm has been screeching all morning at Arlo & Jacob’s Fulham HQ, prompting Nick Wasey to (apologetically) hit the paracetamols as he takes my call.
To be fair, he’s probably getting used to headaches. As we speak in late September 2018, Arlo & Jacob is between showroom launches in Bristol and Harrogate (with “another couple in the pipeline, probably coming early next year”).
It’s clearly a pivotal time for the former online pureplay, which is in full-on expansion mode thanks to a £5m investment which promises to transform it into a truly omnichannel business.
“Whether you’re a small cake shop or Elon Musk’s Tesla, business is a risk,” admits Nick, “but we feel we’ve got all the pieces in place to execute this expansion.”
Over two years, that £5m will be funnelled into technology, product development, staff, and those aforementioned new bricks-and-mortar locations, with a view to lifting turnover past the £10m mark (the physical expansion taking place this year alone will triple Arlo & Jacob’s showroom space, while significantly expanding its national reach).
It’s a big ask for such a young business. Nick launched Arlo & Jacob as an ecommerce venture in 2015, bringing a unique D2C proposition to the JDP Group – the Nottinghamshire-based manufacturer whose brands include Celebrity, Cintique and Wade Upholstery.
“It was a natural evolution for the group,” Nick explains. “At the time, we looked around at the online pioneers in the field, and saw no reason not to set up our own channel, through which we could make the most of the excellent manufacturing capabilities to hand.”
To minimise the risk of stepping on the toes of the group’s existing customers, Arlo & Jacob forged a new path towards a different consumer segment, and went about developing a fresh selection of upholstery. “There were no objections or market conflict,” Nick confirms. “We were focused on design-led, affordable design, made with provenance, and presented beautifully online (and later in-store, too).”
Aside from one or two models, the group continues to manufacture every Arlo & Jacob product in Long Eaton, making it one of the UK’s smaller vertically-integrated operations. Having full control of the production and supply chain from end to end brings numerous benefits, says Nick, but he contests that being a vertical is “not for the faint-hearted”.
He explains: “Retail has evolved so much over the last 10 years, and the complexity is vast. From digital marketing to branding, you have to have the right team in place, as well as the right product – and to go truly omnichannel, you have to make sure all your systems are perfectly aligned.”
Before he founded Arlo & Jacob, Nick worked across a plethora of disciplines including sales, marketing, manufacturing and technology. His work took him across the UK and Europe, and through the whole manufacturing supply chain, before he brought his expertise to the furniture industry.
“It’s a common thread,” he suggests. “A lot of the people in the new wave of furniture retailers are coming from outside the sector.”
Nick is passionate about manufacturing technology, and its ability to enable an engaging, seamless customer buying journey – online, in-store, or both.
“Digital is the heart of our brand,” says Nick, “and in our segment (the premium price level) the customer journey starts online. It’s very considered, comprising various visits to different channels, evenly spread across mobile, tablet and desktop. It might involve a store visit – but the final transaction is generally made online.
“Crucially, every touchpoint, whether digital or physical, is linked. For example, a customer clicking on a digital advert will go straight to the right online content, and that’ll be well configured, and beautifully targeted.”
Nick says that Arlo & Jacob’s website offers more than 100,000 high-definition CGI product renders, which offers customers greater encouragement to build an online basket, and that the business is about to roll out a dedicated app which its in-store staff can use to answer customers’ queries and help them visualise products, build and edit their baskets, and execute a transaction.
Taken together, these measures are designed to improve customer service by ensuring continuity and transparency – and they’re being applied internally, too.
“The trick is making sure all our systems are perfectly aligned,” says Nick. “I heard the other day that there’s a big retailer that’s still printing orders and re-entering them manually into another system – you’ve got no chance of scaling if you behave like that!”
For Nick, it’s about keeping every aspect of the business “clean and slick” – and this is where its vertical integration really shines. Principals can instantly see what stock is available and where in the supply chain it is at any given time, and when a customer makes a purchase, they too can track the progress of their order.
“If you are juggling suppliers or premium product from overseas, supply chain visibility can be a nightmare,” he says. “Our enterprise resource planning (ERP) system sees stock movements in detail, from the factory to the shop floor, and the customer can see that too.
“They love having that insight. In our [online reviews platform] Feefo reports, the quality of our communications always comes up as a positive. People like to be promised a date, which is stuck to – and that’s within your realm when you’re a vertical.”
Arlo & Jacob’s rapid transition from online start-up to bricks-and-mortar player sees it follow in the footsteps of the likes of Oak Furniture Land, Loaf and Made.com – digital disrupters who have gone on to make it big in the physical space, bucking the trend towards contraction in UK retail – and Nick says there are good reasons why so many traditional retailers struggle to make the transition in the other direction by successfully taking their brand online.
“Most are simply not configured internally to go from physical to online,” he says, “whereas young brands like us have no baggage – we’re starting with a clean sheet.” As well as inflexible working models, Nick is referring to old IT and operational infrastructures which can prove extremely resistant to change.
“I’m fascinated by the momentous changes taking place in retail at the moment,” adds Nick. “But, when you look at the names that have gone under, some of them weren’t hugely surprising. As an observer, I can see so many businesses that haven’t evolved their brand, brought in new customers, or got their online operation sorted.
“On the other hand, it’s created a good deal of opportunity (and retail space) for us!”
Poised to seize Arlo & Jacob’s advantage is a “strong team” of marketing, IT and finance specialists, which includes the likes of product manager Laura Barnard, who strives to keep the product lines fresh and ahead of the crowd. “This year we’re planning to bring in a new product every month,” says Nick, pointing to the success of the brand’s partnership with House & Garden magazine, whose input on the design side helps ensure his new models are “bang on trend”.
There’s also new commercial director Harvey Roberts, who brings management experience from the likes of Gautier, Farrow & Ball, Fired Earth and Habitat.
Nick says there’s a family feel to the whole business – indeed, the brand itself was named after Nick’s young sons – which mirrors its target audience.
“Although we get a spread of customers – from 20-somethings to older clientele – themes of family and home run through the whole brand,” he says. “Arlo & Jacob is a premium product (not luxury), for discerning customers with an interest in contemporary design. At our price point, we’re attracting business from across the market.”
The JDP Group has high expectations for its on-trend D2C arm, which appears to be marrying manufacturing heritage and omnichannel strategy to great effect.
“We’re small, our resources are limited, and we always want to move on quicker than we can,” concludes Nick, “but I think we’ve got everything about right to make a bigger impact.”
