It’s All in How You Display It
Pacific Northern Inc.
Outstanding visual merchandising displays reflecting luxury are essential to the success of upscale lifestyle brands. This is why over 150 clients worldwide are turning to Pacific Northern (PN), headquartered in Carrollton, Texas, for customized displays to enhance their product’s visibility in the market place.
While the company name Pacific Northern does not conjure images of luxury the way certain brand names do, the proprietary display fixtures produced by PN allows those brands to shine. Before getting into the intricacies of the art and craft of visual marketing, we asked company president Mike Wharton for an explanation of the name, since the company is neither near the Pacific coast nor the northern U.S.
It turns out that PN is a perfectly logical name, however. Although corporate headquarters are located just twenty minutes from Dallas, the company-owned factory is located across the Pacific in the city of Dongguan, Guangdong Province, China, and its products are shipped via Hong Kong to retailers throughout the northern hemisphere – North America, Europe, the Middle East, and Asia.
It all began, Wharton explained, with Eddie Lee, the youngest sibling in a Chinese family who had emigrated to the U.S. “He was importing giftware for retailers, and in 1994, one of his contacts at Zale (the fine jewelry chain owned by the Signet Group) said, ‘You do this so well, could you do our jewelry display as well?’ And he, being an entrepreneur, said, ‘Absolutely.’ He and his brother went back to China and did their first order for one hundred complete stores for Zale, and that is how PN got into visual merchandising and display,” Wharton shares.
“Two careers ago, I was with Montgomery Ward, and Eddie was one of my vendors, doing import jewelry boxes,” he continues, “and later, I ran the jewelry division of a company called Tuesday Morning in Dallas, and Eddie did all my jewelry displays. Then he convinced me to hop the fence and come to this side of the business and help him grow it. That was in 1999, and I’ve been here ever since. The Lee family continued to run the business until 2013 when we re-capitalized with private equity, and we’ve been a private equity held firm since then.”
Today the company’s roster of over 150 clients worldwide is a veritable who’s who of the brand name jewelry, watch, accessories, eyewear, lifestyle brands, cosmetics, and fine spirits and liquor industries. Among the luxury brands that rely on PN’s customized designs to promote their products are Michael Kors, Lacoste, Estée Lauder, Hugo Boss, TAG Heuer, Spence Diamonds, Kate Spade, Coach, Joseph Abboud, Jimmy Crystal New York, and Zales.
It also includes leading department stores like Macy’s and Nordstrom. Most recently, the company has moved into the hospitality industry, securing an account with MGM Resorts, which has hotels around the world and casino properties in Las Vegas and Macau, China.
Since ninety-eight percent of PN’s business is made up of repeat customers, it says a lot about the company’s ability to satisfy clients that demand exceedingly high standards in design and execution. It also says a lot about a company willing to take on programs that other firms pass on as being too difficult.
Such was the case when apparel and accessories brand Juicy Couture was expanding and needed fixtures for hundreds of stores worldwide. Among the challenges was customization for a variety of spaces, no two of which were the same size or carried the same product mix. The designs were made of solid brass, requiring a high level of artisanal skill. Other pieces incorporated woven fabric, custom faux finish painted fixtures, marble from a specific quarry in Greece, and custom molding.
It was a tall order, which other companies turned down, but not PN. In fact, Brad Lenz, then vice president of Liz Claiborne, Juicy Couture’s parent company, was so impressed by the completion of the unusually complex project, that he nominated PN for the prestigious ‘Above and Beyond’ award presented by Shop!, a “global non-profit trade association dedicated to enhancing retail environments and experiences,” according to shopassociation.org/. “We didn’t win, but we were one of the three finalists,” Wharton says, admitting he is very proud of that.
He is also proud of the seamless process that begins in the sixty-thousand-square-foot Carrollton, Texas corporate headquarters, where a staff of ninety – fifty-six of whom are bilingual in English and Mandarin – are involved with creative design and engineering, accounting, sales and marketing, and distribution.
“Some luxury brands like to have full creative control, so they do the initial design work, and then we do all the engineering and help them with material selections,” Wharton says. “Michael Kors, for example, has a very specific design language. They work in stainless steel and a particular wood grain, so we have to take their design materials and then whatever product they’re trying to house and put those two together,” he explains.
“But other brands start with a blank piece of paper, and they want us to understand their brand DNA, who they are, and the whole feeling they want to evoke in the customer, and so we collaborate, and by the time we build it, it may have gone through twenty different design iterations because it will go back to the client’s committee, and they’ll go ‘We like that part, but this part might be too much for us,’ so it goes back and forth.”
For example, the design team from Kendra Scott challenged PN to develop a cordless, lighted jewelry showcase for open retail spaces, which the company did, using lithium-ion batteries which are small but powerful enough to run an LED light strip for a day.
“Some displays are meant to be in the background, but others are meant to talk to the consumer, so there could be graphic signage, videos, screens. Those are things we collaborate on because we need to understand is this a product you expect your salespeople to sell or does this display need to talk directly to the shopper. It’s not a quick and easy process, and the lifecycle of a project from inception to delivery could be anywhere from eight weeks to two years.”
Once the design and engineering process is finished, manufacturing begins in the factory-owned campus in Dongguan, just north of Hong Kong. “It’s a wholly-owned foreign entity, so we are one hundred percent owner of the factory and have full control. That’s something that differentiates us from other companies because owning and controlling our own factory and doing all the processes in-house gives us precision control on delivery, which is why our clients have stayed with us for so many years.”
Prior to the opening of its new factory in 2016, PN operated out of four campuses, but are now in one giant, 430,556-square-foot facility. “When we built it, we really paid special attention to the needs of the luxury brand western manufacturing standards and invested a lot of money in environmental compliance.” As a result, it has received a four-star green award from the government in Dongguan. “Environmental compliance is just starting to take hold in China, so we are well ahead of the curve,” he says.
“In our factory, we process our own wood and metal and do all our own painting, spraying, and silk screening, so when we built the plant, we put in ventilation systems, carbon air scrubbers to reduce emissions and ionized water dust suppression systems. We also put in our own wastewater treatment plant which goes through fifteen stages before being turned over to the government for disposal, so we are not polluting the waterways,” explains Wharton. “When clients from North America or Europe come to visit our facility, they tell me this is more world-class than factories they’ve seen in their home countries, and that gives me a great sense of pride,” he says.
“Without a strong manufacturing arm, you can’t survive in this business, so we spend a lot of time on our people. For the New Year festival in China, we invited all of our one thousand employees and their families to a big show. We have on-campus basketball and badminton courts; we have tournaments and competitions, and we try to make it a fun place to live and work. I know there are companies where people dread going to work, so we try to keep it fun and lively and take care of our people.” PN also wants to keep staff comfortable and because the climate in Dongguan is hot and humid, the on-campus dormitories, in which approximately half the staff lives, are air-conditioned.
As for the rumors about brick and mortar stores being taken over by online shopping, PN is finding that not to be true.
“For a time, analysts thought brick and mortar was dying amid reports of store closures, but in reality, the opposite is happening,” Wharton says. “It’s true that North America was over-saturated with retail outlets that couldn’t be supported over time, but now the brands realize their online presence is driving the brick and mortar experience. Brands and retailers are spending more money on fewer doors, so Macy’s for example, are down to 900 doors from 1,500, but they are spending more in keeping these stores current, and that’s driving traffic in the brick and mortar stores and online,” he explains.
“Stores that fell by the wayside maintained the same presence they had for years, and they thought customers would keep coming back, but they were no longer exciting and not a good experience. Stores that are thriving are the ones that are spending money to keep their image fresh and to keep people coming through the doors.”
Wharton says his biggest challenge is keeping up with client demand because brands are faced with keeping their stores up-to-speed as images evolve quickly on social media. “Once they could maintain a display for six or seven years, but now that changes quickly, and we have to react to get designs developed, produced, and into the store in a much shorter time than we used to whenever there is a new product launch. So, speed-to-market is the greatest challenge. Successful retailers are really focused on improving the overall shopping experience for their clients, and that means keeping their store updated, fresh, and new,” he says.
“For every product launch, we are designing new displays and fixtures, and they have to be ready for the product roll-out,” Wharton concludes. And even though that means a lot of exacting detailed work and tight deadlines, we get the impression that Wharton and the team on both sides of the Pacific would not want it any other way as the company continues to explore new markets and opportunities.