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Reversing a Scandinavian icon
With Salone Del Mobile in Milan only being days away, we sit down with prominent Danish furniture brand Carl Hansen & Søn’s CEO Knud Erik Hansen to hear about how he turned a failing business into one of the leading players within Scandinavian interior design.
When Knud Erik Hansen took over Carl Hansen & Søn from his brother in 2002, as the third generation in the family business, the business was small, the factory old and the brand, frankly, quite far from its heyday.
— I quickly sold our old factory in Odense and made a business plan. I went to the bank and borrowed a hell lot of money and built a new factory, he says.
The factory workers remained the same and their high level of skills along with brand new machinery convinced Hansen to take the next step, starting up with export.
— We started with the U.S., Sweden, Norway, and the rest of Europe. And everything went very well. We went from 20 employees when I started to 168 in 2008. But, all of a sudden, everything stopped.
The financial crisis hit Carl Hansen & Søn extremely hard and Hansen had to fire 100 people.
— The crunch went on until the end of 2009 when everything changed again. Since then, we’ve seen a very fast development, growing 18-20% a year and opening another new 37,000² factory. We’ve also expanded with a completely new business, producing outdoor furniture in Vietnam.
The key to success, he says, came after realizing that you need a lot of horsepower in the furniture industry in order to become a global player.
— We don’t use agents but have our own representatives — more than 100 people in 59 markets, with Japan being the biggest one. 90% of Danish companies have less than 100 employees, but my philosophy is that if we stay small we don’t stay long. That’s why I emphasize the importance of expanding. Let’s take farmers as an example; if their business is too small, they have too high fixed costs and have to close down. In order to stay independent, we need a good and steady amount of customers coming back to us. And therefore we have to grow — and to maintain having good connections with the bank, Hansen says, smiling.
Another key, which has secured their great reputation, is passionate craftsmanship.
— Our designers back in the 50s were craftsmen. They knew what they’re doing and learned the carpenters and then the architects, Hansen says. They had great ideas and a strong knowledge of the wood; how finely can you make it? Our Colonial Chair is a great example. It’s immensely strong, but at the same time on the edge — a few millimeters thinner and it would break. It’s done with perfection.
The most important thing for Knud Erik Hansen now in 2019, after reaching a 500-million Danish Kronor turnover (aiming for 1 billion in 2022), is an environmental consideration.
— Let’s not forget that we use mother nature’s own material to make furniture. It’s all made of wood, mainly Danish, and sustainable. And the waste from the wood cuttings in our factory northwest of Odense in Denmark is all used for heating. That means that between April and September, the local municipality can switch off the gas used for heating and exclusively use our distance heating. Each house saves 4000 Danish Kronor (almost €540) on that every year, he says.Carl Hansen & Søn