With recent slowdowns in the overall economy and in the home furnishings industry, more vendors are looking to the contract and hospitality niche as a new venue for marketing and selling their products, while others have worked in that realm for years.

According to Nestor Pineda, director of contract sales for The Phillips Collection, it was a natural niche for his company to pursue, given the nature of the products it produces.

“Hospitality found us,” he said. “The contract market found us because our product is very appropriate for it.”

The Phillips Collection's large-scale pieces work well in banks, hotels, restaurant and spa installations, he said. “Our product works so well for hospitality – because we have so many conversation pieces. Like our tagline says, 'Every piece is a conversation.'”

Bob Morrison, vice president of sales and marketing for Old Hickory Furniture, said his company has been involved in the contract side of the business since the 1800s, with signature jobs at Yellowstone Park and other national and historical sites.

“We've been in hospitality probably as long as anyone in the business,” Morrison said.

“The people that are buying our furniture are looking for the look and are not as price-sensitive,” he said, noting that most of Old Hickory's contract jobs are with non-chain hotels, restaurants and even theme and water parks.

Pineda said the company has shown at the HD Expo and Boutique shows for the last two years.

“Our first time in Vegas, the response was so unbelievable,” he said. “We won best in show for product and presentation, so that opened a great window of opportunity for us,” noting that all that was achieved from a very small booth in a less-than-ideal location.

Old Hickory shows at the HD Expo and at the International Hotel, Motel, Restaurant Show in New York in November.

Paragon has shown at the HD Expo for four years, and has added the HD Boutique show, as well, said Melonie Young, key accounts manager specializing in the contract and international markets. Paragon has worked with contract accounts for more than 15 years, though, she said. “It's really grown and grown. We've always done specialty work and it's just moved into contract and hospitality.”

According to Bob Ulrich, vice president of sales for Currey & Company, “The contract business is and has been a growing channel for us over the past 10 years. We are actively pursuing the business, but in a very passive way. I say that because we do not have 'contract reps' or a dedicated corporate person to pursue and market to the contract industry. Some of our current representative organizations are very active in their efforts to capitalize on the contract opportunities that present themselves. Often these opportunities fall into their laps through their contacts with designers and not through a relationship with contract industry structure.”

There are some key differences in the contract versus residential market.

“The main difference I see is that residential is pretty steady. You generally can count on a certain amount of orders in a given month,” Morrison said. “With contract, you can get hit with several orders at the same time, though the hospitality people tend to plan better and be more time-conscious. We sometimes get orders six to eight months ahead of time.”

“You also have to be pretty flexible,” he said, noting that if construction is held up for some reason, the order may need to be held for several weeks or even months.

“The contract business was a little bit weak last year, but it's already picking up in 2008,” Young said. “Getting the contract accounts is like sifting through the sand to find the big jobs. Residential is more steady and consistent.

“It is very different,” she said. “On the commercial side, there's a lot more paperwork, dealing with bids and quotes. But once (the buyers) know what they want, they want quantity. With residential, there are a lot of onesies.”

“The reality is that the contract business is a very different animal from the retail channels that we are currently selling,” Ulrich said. “The product requirements, sales collateral materials and the internal support necessary to actively pursue contract business must be treated as a business and not an 'add on' if you are to be successful.”

Pineda said HD business is more consistent than residential, but it is all about relationships and shipping products on time.

“We spend a lot of time and money building relationships, and we believe in sticking to our promises. You don't want to burn those bridges once you have created them.”

Another key difference is the way that the hospitality and design shows and buyers operate.

“HD is very different – it's a very particular market,” Pineda said. “You will see a lot of the same manufacturers and importers as you do at the residential shows, but they showcase their products very differently. You don't write orders at that show, so instead it's all about presentation. It's all about that minute that you have with a head designer … you have one minute to make an impression.”

“It's a whole different customer — they just operate in a different world,” Morrison said. “They don't go to High Point. Most just attend the hospitality shows.”

All agree that the hospitality and contract markets present legitimate opportunities, though it can be a tricky road to navigate.

“It's a hard group to learn and they have to learn who you are,” Morrison said.

Hard-wired lighting poses its own sat of challenges, Ulrich said. “For the lighting business there are a number of issues that make selling to the contract channel different than the residential channel,” he said. “There are ADA requirements, Energy Star programs, product specifications that require unique socket, plug and data ports, and material standards to meet a variety of codes and standards for contract. All of these represent a change from our retail products that we run through our factory.”

Paragon has made solid in-roads in the business, but would like to reach higher, Young said, “We've yet to tap into the really big hotel chains, so our goal is to work our way into those sectors,” she said.

Currey, too, is looking to reach farther into the category, but Ulrich said that for now, it is not a primary focus. “Essentially, we are able to get our share of the low hanging fruit,” he said. “But if we are to really address this category we would need to develop a sales and marketing strategy to address the needs of that business.”

The recent media focus on new hotels, restaurants, office buildings and more has really upped the ante on the unique designs that each one offers.

“There are always going to be hotels all over the world,” Pineda said. “And every project is more ambitious than the one just finished.