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Design Circulation is a system in which furniture is never discarded nor destroyed, but rather circulated from home to home in perpetuity. Through Design Circulation, 57st. design will take back it's furniture--at any point in the future, and regardless of wear--in exchange for a significant percentage of the original purchase price in store credit (as much as 40%). Each piece is then restored to original condition and circulated (resold) to the next owner for continued use. The system intends to incentivize a more sustainable approach to furniture consumption. Design Circulation will launch nationwide in the spring of 2018.
Design Circulation lies at the intersection of furniture design, system design and innovative business practices. Inspired by principles of Circular Economy, Design Circulation is made possible by two features unique to 57st. design: (1) our furniture is solid hardwood and hand-finished, which allows it to be readily restored to its original condition, and (2) we manufacture all of our product both locally and in-house. In this way, Design Circulation is the product of both efficient supply chain management and considered product design. If we manufactured our furniture far from our consumers, or if we outsourced our refinishing, Design Circulation would be too cost-prohibitive or logistically nonviable.
Design Circulation as a system can only succeed if it first succeeds as a business. We designed the program to economically incentivize participation from all parties equally. For consumers, Design Circulation is a flexible and relatively accessible means of owning solid wood, contemporary furniture: circulated furniture costs less than it would otherwise, and customers can trade it back whenever they want for hundreds of dollars in store credit. For 57st. design, it's a means of guaranteeing high customer lifetime value (as previous clients are strongly incentivized to purchase furniture from us again in the future). In this regard, Design Circulation is intended to be a self-perpetuating system, and thus more likely to achieve its goal of promoting sustainable furniture consumption.
Design Circulation encourages consumers to reimagine the traditionally linear furniture life-cycle: with Design Circulation, a piece of furniture is not considered through a binary of "used" or "new." Implicitly, it rejects the idea that previously owned furniture is necessarily diminished in value-- to the contrary, it's no less strong, it's no less durable, it's no less functional, it's no less beautiful.
Ultimately, 57st. design's goal is to one day have so much furniture in circulation that we're manufacturing less furniture even as we continue to sell more of it. We'd shift from furniture makers to stewards of a circulating furniture collection.
Trade Back Process for Customers
Design Circulation was inspired by what some people refer to as the "designers paradox": given that the manufacturing of designed products represents one of the largest human impacts on the planet, the most sustainable thing you can do as a designer is to not design at all. Among other things, Design Circulation is a practical approach to this problem.
Since Design Circulation introduces an unconventional system of furniture commerce, one in which a piece of furniture is sold, brought back for restoration, and sold again, ad infinitum, the system necessarily influences the design of the furniture itself. Among other things, the furniture must be designed and constructed to mitigate against the likelihood of damage that is irreparable, and in such a way that the furniture can be refinished to its original condition. Our standard for "original condition" is as follows: an experienced furniture maker should be unable to tell whether a piece was finished ten days ago, or ten years ago. To achieve this, we rub on our finishes by hand rather than spraying them, which allows us to spot-refinish. In addition, we "break" all the edges on our pieces with a ?" roundover, thereby minimizing the likelihood of irreparable chipout. This approach extends to material selection, as well. For instance when practical considerations force us to use a veneer product instead of solid wood, we use custom plywood panels with 1/32" thick hardwood veneers. In contrast to commercially-available plywood veneer, this thicker-veneered plywood permits light sanding and refinishing.
Design Circulation's circular mode of commerce doesn't only influence our furniture's construction-- it also influences its appearance. For us, minimalism is less an expression of aesthetics than an expression of function. Clean-lined, understated designs are much more likely to feel aesthetically relevant in a decade or two, which will make them more likely to continue to circulate.
In order to achieve its goals related to sustainable consumption, Design Circulation must eventually succeed as a mass market business. This, too, has informed our approach to product development. For instance, we plan to release a collection of flat-pack, solid wood coffee tables and side tables. In some instances, these pieces assemble without hardware and in only a minute or two. Shipping is one of the largest expenses in bringing furniture to market; shipping these pieces unassembled allows us to retail them at a price that's 20-30% lower than if they were shipped fully assembled. Furthermore, we plan on introducing more modular designs with components that can be repaired and replaced piecemeal.
Before launching Design Circulation, we needed to vet the business model with consumers. Our initial research into Design Circulation began with in-person interviews with existing and potential customers. Our goal was to better understand consumer perceptions of "new" versus "used" in relation to furniture, as well as furniture disposability. From these interviews, we developed a survey. We distributed this survey to nearly 500 consumers in our target demographic. Among other things, 93% of respondents said they would be interested in giving back their furniture to the store from which they bought it in exchange for store credit. This suggested the existence of meaningful consumer demand for Design Circulation.
Once we felt confident Design Circulation would be well-received by consumers, we set out to evaluate the viability of the program from a business perspective. There were early concerns that we were giving away too much store credit to remain profitable in the long term. To help us explore this further, we first contracted a PhD in operations research (a field of applied mathematics) to develop a proprietary pricing optimization algorithm. This algorithm considers material and labor costs, shipping costs, and projected frequency of circulation (e.g., a side table will circulate more frequently than a dresser) in determining both an acceptable retail price for a design, as well as the amount of store credit we can exchange for it. It also yields a "salvage price," which is the price at which we need to be able to sell the piece if it's irreparably damaged and can no longer be circulated.