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Real Estate News Releases
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(EstateNewsWire.com, November 25, 2012 ) Austin, TX -- Kurosh Amrami had expected that his August going-out-of-business sale like bugs to a bright light.
Amrami’s liquidation sale at the Grand Oriental Rugs in Edina will take place 35 years afte the opening of his business. Despite 75% discounts, he said business has been disappointingly slow.
“Consumer tastes changed in the last five years,” he stated. “many of my rugs are traditional styles and colors.”
There has been a considerable drop in the demand for high-end rugs within the last few years, and the rug dealers in the Twin Cities are certainly feeling that impact.
The sheer number of Oriental rug dealers within the metro area have flailing from 25 in the 1990s to 10 currently. Nationwide, the number has dropped from 20-70% depending upon the business, according to Mike Joseph, former president of Oriental Rug Retailers of America.
According to Joseph, the real change in behavior is that customers have begun to find items in lieu of luxury handmade rugs. They instead are focusing on machine-made and tufted rugs that sell for less.
Many consumers could care less the rugs will not last as long or be as glamorous. They are probably tired of it by then anyway, says Alex Farahan at Cyrus Artisan Rugs in Edina.
Since the start of the U.S. recession, consumers are tightening up their finances, and a hand-knotted rug for $5,000 is something they can likely do without.
Even those who are capable of appreciating the elegance and lasting-power of the rugs likely cannot keep them long enough to make up for the initial cost.
Jeff Farahan, who owns Designer Marketplace in Minneapolis, stated there is no question that the Oriental rug industry needs to evolve. Labor costs in China, India, Pakistan, and Turkey continue to rise, and thus the price of hand-knotted rugs.
A $3,000 rug that is made with cheap labor would likely cost as much as $200,000 in U.S. wages. “They will only be available to the wealthy,” noted Farahan.
Oriental rug dealers are known for marking up the rugs compared to the wholesale pricing, wherein they then “discount” the rugs to twice the wholesale price. This strategy is not uncommon, according to Mark Keljik, owner of Keljik’s Oriental Rugs in Minneapolis.
"If more dealers put a reasonable price on the tag instead of marking it up, we'd be in a better position," said Lissa Wyman, editor and publisher of Rugnews.com.
At Designer Marketplace, Farahan says his sales of furniture and rugs have flipped. “Forty percent of my gross revenue in 2008 was rugs,” he noted. “Now it is under 10%. Even an affluent customer does not want to pay $3,000 for a rug anymore.”
About Oriental Rug Gallery of Texas:
Oriental Rug Gallery of Texas (http://www.orgtx.com/) is a family-owned online and brick-and-mortar rug store dealing in Houston rugs, Dallas rugs, Austin rugs and San Antonio rugs. They have been in business for more than 80 years, based in San Antonio, Texas. Oriental Rug Gallery of Texas has five showrooms in Austin, Bee Cave, Dallas, Houston, and San Antonio. They offer a wide selection of floor coverings, along with outstanding service, and are able to ship most of their in-stock product within 24 hours from their 100,000-cubic foot warehouse. Visit the orgtx.com website today to learn more.
Oriental Rug Gallery of Texas
Customer Service
(512) 343-9900
news@postpressrelease.com
Source: EmailWire.Com 
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