Interior Design Services of Charlotte

By Rhee, Kenneth S.; Peters, Cara | Journal of Critical Incidents, Annual 2011 | Go to article overview

Interior Design Services of Charlotte


Rhee, Kenneth S., Peters, Cara, Journal of Critical Incidents


Cheryl Johnson was sitting on the grass on a Saturday afternoon watching her son play lacrosse. As her son was running down the field, she could feel the Blackberry in her purse vibrating like crazy. Cheryl owned her own interior design firm in Charlotte, North Carolina but she did not typically work on Saturdays, so that she could spend time with her family. She tried to ignore the call, but the phone buzzed again and again. Eventually, Cheryl pulled the Blackberry out of her bag and looked at it. She had three missed calls in the past fifteen minutes, all from a current client with whom she had been having some issues of late. Cheryl took a deep breath as she thought about whether she should call her back immediately or wait until Monday.

Company Background

Interior Design Services of Charlotte (IDSC) was a one-person, franchise operation owned and operated by Cheryl Johnson in Charlotte, North Carolina. Cheryl sold a wide range of interior decorating products and services to clients. She sold upholstered furniture, case goods (i.e., wood furniture such as a side table or buffet), rugs, fabrics, window treatments (including shutters and blinds) and decorative accessories. In addition, Cheryl sold various interior design services such as paint selection services and staging (i.e., layout of furniture in the home).

Cheryl worked out of her home, which was ideal, as she also took care of her husband with a heavy work and travel schedule, and three school age children with plenty of extracurricular activities. Cheryl had bought into a national franchise, called Interior Design Services (i.e., the parent company, IDS) because it allowed her to effectively compete with large stores in the area who sold similar products and services. The IDS franchise gave Cheryl access to product discounts, access to vendors, advertising and promotions, legal services, and information technology (IT) services, among other benefits. Per the recommendation of the IDS parent company, Cheryl purchased furniture and fabric at wholesale prices and then marked them up to full retail (which was two and half times cost).

Cheryl obtained almost all of her clients via word of mouth. At any point during the year, Cheryl had between six and fifteen clients. Most client projects lasted about six months in length from the initial consultation to the installation of the finished product. An average client account resulted in $12,000 in gross sales for IDSC. Furthermore, approximately 50% of Cheryl's new customers became repeat clients within a short time of finishing the first project.

The Client

In the fall of 2009, Cheryl had a very good client who referred her to a friend who was looking for an interior decorator to help her improve the look of her home. The client did tell Cheryl that her friend "could be difficult but she was serious about working with a decorator." The next week, Cheryl gave her client's friend a call. Kimberly Banks was very pleasant over the phone. By the end of the conversation, Cheryl had secured an initial consultation with Kimberly and her husband, Bill.

During the initial consultation, Cheryl tried to gauge what kind of client Kimberly would become. She seemed to have a charming personality but did not have exquisite taste. Cheryl noticed right away that Kimberly's "furniture was cheap and poorly laid out," two signs that Kimberly "might not understand how to work with a high end interior decorator" of Cheryl's quality. In addition, Kimberly communicated unrealistic expectations of what products and services she wanted versus what she wanted to pay for these items.

However, Bill owned a large construction company and tempered Kimberly's expectations throughout the meeting. Bill knew what high quality furniture and decorating cost. Bill kept telling Kimberly that she was being unrealistic and needed to defer to Cheryl as the expert. At the end of the visit, Kimberly admitted that she needed a professional decorator's help and was willing to be open and receptive in working with Cheryl. …

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