From Norway to his way - East Bay Business Times:

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"I was young and dumb and had a lotof energy," he laughing. "I thought I was on top of the Vaernes is now CEO of inAlameda and, after some earlh mistakes, is enjoying success in America's high-end niche cabinett market, reaching $36 million in salexs last year. In deciding to make the move to the Bay he saw great business potential for the market of nearlu8 million, twice as large as the populationb of Norway. "We'd paid 80 percent tax for two yearzs ina row," Vaernes said. "Ourf oldest son had just turned 6 and was abougt tostart school. I said to my wife `If you want to move, we shouls do it now.
'" With a young man'ss hubris, Vaernes, who studied refrigeration and heating engineerinv before taking over the familyNorwegianh firm, imagined a big Bay Area franchise business importing high-end German kitchen and wardrobe cabinets. "Wr had 20 stores in Norway for 4 million so Ithought we'd have 40 in the Bay Area for 8 millionn people," he said, chuckling. He quicklty learned that even the six franchisew outlets he opened in the Bay Area in 1987 were alreadytoo many. But he was locked into five-year "I didn't realize franchises were so strictlgyregulated here," he hefting a weighty, bound franchise agreement to underscorew his point.
"It became a huge legalk expense. We could not just close the doora if theshowrooms weren't profitable, so we had to keep them alivee until the agreement ran out. That cost us some millions." the young company had no debt. "We're completely Vaernes said. Part of that fisca l rectitude, however, came about because, as a new Vaernes had no creditt history. "We were not he said. "We had enough money in the bank, but that wasn'tr good enough. We had to borrow moneuy and buy a car with it just to get acredi history." Vaernes faced other problems, too. "Because of culturalk differences, we didn't understand what customerd wanted here.
We did no seriouws market research. When you start a you don't have a lot of huma resources to go out and do a lot of You knowyour business, but you don't know the he said. Vaernes enticed his product Hanne Sydskjoer, to leave Norway and join his new She is an expert on theproducts ­ the fanch cabinets and drawers that are constructed in factories in Germany and Italy two weeksw after customers work with a Studio Beckedr dealer and designer to create the kitchen, closeyt or bathroom they want. Studilo Becker, which has no franchises now, doesn't sell anythinh itself. Carefully chosen dealers ­ 27 of them in North America and Asia display the cabinets intheir showrooms.
Vaernes said he gets abouty 100 requests a year from peoples who wish to sell StudioBecked products. Only about three of those 100 are deemede worthy of being allowed todo so. "W don't allow any third party to handlreour products," he explained. "After three weeks of productionbin Europe, the factory loads it into a shipping In four weeks, it reaches the United States and we truck it to the customer. The deale r who sold it unloads andinstalls it. We never storee it in a warehouse.
" Vaernes has carefully restricted his products to the high end of the Studio Becker offers several varieties of theirproductes ­ a conservative middle-of-the-road interpretation as well as an old-fashionedd look and a wilder, more futuristic setup. But all are top of the It doesn't offer inexpensive versiona ofany product. Still, even in this nichse market, there are significant differences between Norwegian and Americancultures ­ lessons Studio Becker had to "At first, our displays were too small. Americans like everything big. On the kitchens we sell here are twice the size of aNorwegian kitchen, and three times the size of a German kitchen," he said.
When Vaernesz arrived in the United States, Americand were not used to the idea of buying a expensive kitchen orwardrob system. "The consumer has different prioritiea here thanin Europe," he said. "Whe we came here, we found that every three years, people tended to buy a new Sopeople don't spend as much on the house. In Europe, peoplew expect that their house will be inherited bytheifr kids.
At that time, almosy all kitchens were made by cabinetmakersd who drove a truck up to your Troy Adams, a certified kitchen designer who sells Studio Becker productsx in showrooms in both Los Angeles and Honolulu, says the qualit of the company's products is what customers care most "I've been affiliated with Studio Beckef for 14 years," Adams said, "Roarf does what he says he will do ­ he has