As he plans to unveil a vastly expanded offer at the postponed January Furniture Show this April, Qualita’s founder and MD Andrius Miničius shares his company’s journey, from Battersea shop to global powerhouse, with Paul Farley …
“It seems to me that it doesn’t matter how well you do all year,” Andrius tells me, “at Christmas you’re judged extremely harshly if orders don’t arrive on time! Thankfully, we’re very much on track to deliver.”
Last year’s Golden Quarter saw Qualita busier than ever, thanks to a confluence of opportunities which means the Lithuanian cabinet furniture manufacturer, a long-time supplier to UK independents and multiples, now has even more strings to its bow.
When Winsor Furniture’s key factory was destroyed in a fire, its principals searched high and low for a new manufacturing partner to ensure the continuity of its bread-and-butter collection, Stockholm, finally alighting on Qualita – and bringing the Winsor by Qualita brand into Andrius’ stable.
Of even greater significance was Qualita being selected to represent all of former key customer Laura Ashley’s cabinet sourcing and manufacture (excluding upholstery), some months after the retailer’s brand and IP rights were sold to a US investment firm.
Clearly, one man’s loss is another’s gain. Both of these additions to the business were bred from adversity, and the outcomes could have been so much different for everyone involved. Now, as Andrius comes to terms with the scale and scope of this new operation, he’s looking to this month’s January Furniture Show – the UK trade’s first major gathering in two years – and setting the stage for a barnstorming next act.
“Our show stand’s going to be twice the size this year,” says Andrius. “As well as a host of new Qualita-brand launches, Winsor’s Mark Devany and five of his agents will be there with Stockholm, and I’ll have more news on the whole host of developments that have gone on behind the scenes in the last couple of years.”
Building business
Having studied economics in Riga, a young Andrius Miničius decided to take a year out to promote his brother’s pallet timber business in London. Confronted with a saturated market, Andrius turned his attention to retail instead, setting up a small shop in Battersea, Wood Empire, and selling interior details such as cladding, flooring, skirting – and furniture.
When the opportunity arose to acquire a failing factory in Lithuania, Andrius and his business partners seized it, putting the profits from the store back into manufacturing, saving the facility and creating a supply arm alongside the bespoke business.
“Initially, we sold goods into the UK through Link International (Christian Harold). When they went under in 2008, we moved quickly to establish a direct trading partnership with their biggest customer, Laura Ashley, which was turning over €1m every quarter with them. Given that the financial crisis was just hitting, making sure we were in a position to take over wasn’t easy – but, thanks in part to us already having a shop in London, we managed to establish a UK wholesaling company (Qualita), and moved forward with Laura Ashley.
Going national
“That partnership really opened the doors for us, and we grew steadily with new customers and contracts, all the time building our independent stockist base.” While Laura Ashley remained Qualita’s biggest customer, other major accounts, including Heal’s and John Lewis, soon followed.
A chance meeting with Habitat’s trading director in the Battersea store led to a partnership that lasted until Home Retail Group sold the brand to Sainsbury’s in 2016.
“I was covering for someone in the shop, and a couple entered looking for a side table for their holiday home,” Andrius recalls. “I sat with them for two hours, drawing up the various possibilities – and the man, who turned out to be Habitat’s Malcolm Brighton, suggested that perhaps we could do bigger business together. Home Retail Group had just taken over the brand from the administrators, so Habitat’s supply base was in flux, and there was plenty of opportunity. Right place, right time?”
John Lewis proved slightly harder to crack. “We were different to any other wholesaler at the time, in that we could make to order – tables of any different size, finish or style,” Andrius explains. “It turned out that John Lewis’ category-specific buyers weren’t keen to take on such a complex proposition, so I ended up pitching it to their head furniture buyer, Dave Brittain. MTO was not that popular at the time, but Dave recognised that our offer could stand out in their portfolio – and we went on to do business with John Lewis for many years.”
New markets
Wary of having all his eggs in one basket, Andrius began eyeing new territories and markets as the decade progressed, and as luck would have it, the acquisition of another down-on-its-luck Lithuanian factory enabled Qualita to open the door to Germany in 2014.
“When we acquired it, the factory was doing €1m turnover in Germany through some 160 shops – and we doubled that within just two years,” says Andrius. “We had assumed that some of our British product would work there, but sadly, those lines weren’t to their tastes. That said, the more rustic/industrial German products were quickly adopted by our UK stockists.”
In 2015, another Lithuanian supplier went into administration, this time granting Qualita entry to the Swedish market. Spain followed, and France (by way of Habitat).
In 2019, the company’s principal factories were merged and expanded, creating a 16,000m facility that employed some 250 people. It was divided into three departments: bespoke MTO, which handled samples and batch sizes up to 20; MTO tables, tasked with an output of around 150 models each week; and a volume division, carrying out batch production for larger customers.
“Prior to entering Germany, 90% of our business was in the UK,” says Andrius. “As we grew elsewhere, that fell to 60%.”
His insistence on spreading the risk would prove prescient.
Perfect storm
March 2020 will be remembered as the month in which most of the western world woke up to the fast-spreading Covid-19 pandemic, as lockdowns, furlough and supply chain disruption quickly became the order of the day.
For Qualita, that crisis was preceded by another. That very month, a struggling Laura Ashley – still Qualita’s biggest customer, accounting for some 60% of its UK business and around 35% of its overall revenue – went into administration, finally giving out as the pandemic loomed. The timing proved crucial.
“We’re lucky Laura Ashley went into administration before the pandemic shut everything down,” says Andrius. “We employed over 300 people, and so many of them were making Laura Ashley products – so we were in much deeper trouble than those businesses just having to contend with Covid shutdowns. Furlough helped, but many staff left. It was a very hard time.”
Qualita’s diversified customer base helped to a degree. “So many countries closed down completely at the outset, but Sweden’s shops stayed open, so we were able to refocus our attention on those 60 customers – our standard 10-week lead time for tables became just four weeks for them!”
Yet it would be some months before the real lifeline came.
In partnership
After buying Laura Ashley from administration that spring, Gordon Brothers was plotting the retailer’s recovery, and initiated negotiations for supply licenses. Thanks to their long history together, Qualita was first in line.
“We signed a deal in the autumn to be their sole sourcing partner for cabinet furniture,” says Andrius. “And this wasn’t just a UK deal, it was global. We became the de facto partner in helping to design and develop Laura Ashley’s cabinet goods. It reignited the business, and meant we were no longer just the manufacturer-wholesaler of our own product, but would be operating on a much larger scale, buying different products and working with numerous suppliers in different countries.
“The deal gave us a completely different perspective on our growth. Before that, we were limited by our own factory – suddenly, there was so much more to fall back on. Laura Ashley’s bankruptcy actually made us stronger.”
Rehoming a classic
In the background, Winsor Furniture, a well-regarded UK cabinet brand that worked parallel to Qualita, was enduring its own tribulations, which would eventually see it join the Lithuanian’s ranks.
Winsor’s mainstay was Stockholm, a clean and classy Scandi-style collection that had proved a firm favourite with UK retailers and their more discerning customers for many years. Disaster struck Winsor in January 2021 when its principal factory in Vietnam burned down, and despite MD Mark Devany’s best efforts to find another manufacturing partner to take on his hit range, none fit the bill – until Qualita agreed to step in, some eight months later.
“Winsor sold Stockholm into well over 100 UK independents, and I was confident we’d be able to maintain business with the majority of them,” Andrius explains. “We acquired the license to make and sell Stockholm from Lithuania. What we could make was not like for like, but it was very similar. We also took on Mark’s agents, and lined up the relaunch for the January Furniture Show.”
Full circle
Armed with new business thanks to Winsor and Laura Ashley, Andrius is now setting his sights on a more holistic proposition, for customers old and new.
“Stockholm’s a very high-quality oak/oak veneer range, and it’s value-engineered to stand out against its cheaper competitors,” says Andrius. “That’s what independents like about it – you can very clearly see the difference.
“We’re hoping it’ll be the first of a whole family of British classic ranges. We’re launching it with 23 pieces of living and dining furniture – keeping bedroom on hold for the time being – and making it in batches, so it can be stocked for quick delivery. We’re hoping to bring the delivery window down from 10-12 weeks to 6-8 – that’s just one of the advantages of manufacturing in Eastern Europe rather than the Far East!”
Surrounded by a ready supply of local materials, Qualita’s factories are processing some 400m3 of solid timber each month. Order fulfilment currently spans anything from 4-12 weeks, depending on stockholdings, material availability and the level of bespoke work required – a consideration which still applies to much of the business’ core lines.
“Our independent retail range is still going strong,” Andrius continues. “It is contemporary-industrial, unique and MTO, so there’s lots of choice, and our customers love that customisable aspect.”
Qualita still works with an impressive roster of multiples, but Andrius is adamant that its privileged new working relationship with Laura Ashley will only help existing customers.
“As our network develops, we’ll be able to create better prices and more margin for everyone,” he explains. “It’s been a steep learning curve, but we’re establishing supply partnerships everywhere from Poland and Romania to India and Indonesia. It means we’re in a much better position to manage the entire supply chain, and make import delivery more straightforward.”
There’s no problem there – as a UK-registered entity, Qualita handles customs clearance for its customers. “We take care of all of that. There is a cost involved for us, but it’s a competitive advantage we’re proud to have,” says Andrius. Qualita also boasts a UK customer service team that’s available seven days a week, free marketing support, some in-house delivery capacity, and the ability to professionally handle replacements and repairs.
“Because we had our own production facility and UK store from the outset, we’ve always found ourselves operating a little differently to your typical importer,” Andrius concludes, pleased with what he’s achieved, but conscious that there is much more hard work to come.
“The last two years have been tough –more difficult than you can imagine – but we’ve persevered, and it’s amazing how much stronger we are now we’re coming out the other side.”
Being blessed with opportunity is one thing – but, amidst all the disruption, Qualita created its own, and the business will never be the same again.
Read more about Qualita's growing manufacturing empire in January 2022's Furniture News.
