Semihandmade's John McDonald on hitching his wagon to Ikea, and then competing with it


Manage episode 275608302 series 1743309
By The Modern Retail Podcast. Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio is streamed directly from their servers. Hit the Subscribe button to track updates in Player FM, or paste the feed URL into other podcast apps.

If you're going to ride behind another brand's success, Ikea isn't a bad choice. That's, in fact, what Semihandmade did.

Semihandmade makes and sells cabinet doors for the giant retailer's fixtures, which can themselves be bought without the doors. For a small price increase, according to founder John McDonald, you get a big step up in quality.

But even though business is good on that front -- Semihandmade has been profitable every year, according to McDonald -- he's looking to cannibalize his own market with Boxi, a soon-to-launch, more premium offering that can fit out a set of kitchen cabinets in its entirety.

One big opportunity McDonald spots is the lack of name recognition beyond the top spot filled by Ikea. "There's Ikea in the U.S. and then there's 50 others made by the big guys," McDonald said on the Modern Retail Podcast.

With Boxi, McDonald is starting with just a few types of cabinet doors. "You do four or five things great. And that's how we're able to be highly competitive in terms of pricing and high quality, but it's not for everybody. To me that's the clearest path to scale," he said.

There's nobody else out there doing this, he claimed. Absolutely, there are cabinet companies. But they're faceless. There's Ikea in the U.S. and then there's 50 others made by the big guys. Part of what we want to do is be nontraditional, looking at what the other guys are doing and say 'we're not doing that.'

156 episodes