How one man created a rug firm with a famous following
- 13 August 2014
- From the section Business
A magic carpet ride might be the best way to describe Christopher Sharp's journey.
Starting out idly browsing the souks of Saudi Arabia as a hobby, he now runs a multi-million pound business selling rugs to a star-studded client list.
The Rug Company, which Mr Sharp set up with wife Suzanne in 1997, creates handmade designer rugs, which cost between £2,000 and £8,000 for an average 9ft by 6ft (2.7m by 1.8m) rug, and can run into the tens of thousands of pounds.
Former Microsoft founder Bill Gates, actresses Sarah Jessica Parker and Cameron Diaz, reality TV stars the Kardashians, British chancellor George Osborne, and former Manchester United football manager Sir Alex Ferguson are all customers.
Even Prime Minister David Cameron is a fan, commissioning a bespoke wall hanging from the firm to give to Barack Obama to commemorate the US president's 2011 state visit to the UK.
As the 53-year-old Mr Sharp breezes into the room fresh from a flight from Nice, long haired and more than six foot tall, it's easy to imagine him charming his famous clientele.
Such customers helped drive sales to £22.4m for the financial year which ended in March, with £4.3m in profits. And the firm now has 22 shops globally, with six in the US and three in the UK, including the rug department at Harrods.
Mr Sharp credits the firm's regular collections of rugs created by well known designers including Paul Smith, Vivienne Westwood, Alexander McQueen and Diana von Furstenberg, which account for half of its sales, for its success.
"Because we work with all these designers it's always new. No one else does modern rugs the same way in the UK," he claims.
Despite their importance to the business, Mr Sharp says getting the various designers to work for them was "fairly random and serendipitous".
He adds: "It's not been a master plan of 'these are all the people we want to work with'. For example, I met Paul Smith while I was buying a shirt in his shop."
Even Mr Sharp's interest in rugs was initially just a way to kill time. He and his wife started collecting them when Mr Sharp was based in Saudi Arabia for his former job as a film producer, and the local souks offered the best night life.
It was only when Mr Sharp quit film producing and they spent some time in Malta - Suzanne's home country - that the interest became commercial. They opened a shop there to sell some of the rugs they'd collected "on a very small scale".
This gave them a sense of the possibilities, and once they returned to London to school their four children, they immediately checked out the local rug shops to see whether they could compete.
"Back then generally it was people doing closing down sales with 90% off, or you'd go into the shop and they wouldn't give you the price. We just felt there was an opportunity for a shop with normal retail practices," says Mr Sharp.
The couple used their savings to open their first store in Chelsea in London, with everything priced, and a focus on good service.
From the outset they spent heavily on advertising, taking out full page adverts in quality interior design magazines.
"This French guy came into the Chelsea shop, and I could tell he was disappointed, and he said: 'Oh your advertising is so big and your shop is so small'. But that's what you want to do. You want to be bigger than the brand," says Mr Sharp.
The firm initially stocked traditional rugs, but with many of the people who came in exclaiming they were "exactly like the ones my grandmother used to have", the firm decided to change tack.
A year after first opening, Mrs Sharp, who continues to oversee the creative side of the business, designed a contemporary collection of rugs. The fact these sold well changed the direction of the entire business, and they went from buying rugs to creating them.
The rugs themselves are made in Nepal, where the firm employs 2,000 staff. Each rug takes an average of four months and 20 people to make, making them "good value" despite their high price tag, says Mr Sharp.
Mr Sharp gives the impression of having effortlessly charmed his way to success, but he says it was tough initially. He started out working on the shop floor, and for the first five years they made no money at all.
"I remember saying to Suzanne in the third year that we'd been working for the past three months and lost £30,000, we'd have been better off if we hadn't done anything at all," says Mr Sharp.
What kept them going he says is their "ambition", and their confidence that they had found an untapped niche.
The catalyst to the business taking off, he says, was inviting the then top 10 interior designers in London to create a rug. "We said 'you know what your customers like, design the perfect rug for them'. So we had a collection that they started using."
Today the firm sells 80% of its rugs to interior designers.
And since 2008, when it sold a 30% stake in the business to private equity firm Piper, which insisted it install both a financial director and a chairman, as well as hold regular board meetings, it has expanded rapidly, opening 10 new stores.
"Until they turned up it was a typical entrepreneur business. We were really good at design and marketing, and our shops were great, but the back end of the house - the plumbing and the wiring - were quite sketchy," says Mr Sharp, who holds the chief executive position.
Despite the closer focus on costs, the firm continues to spend big, and currently employs a full-time chef for its Chelsea shop, enabling customers to eat breakfast or lunch as they browse.
Mr Sharp says: "It's that sort of thing that seemingly isn't going to make a business any money that creates a luxury brand from a non-luxury brand.
"If you're going to be a luxury brand, then you're going to have to live in a luxury way and we're quite good at that."