Chance to sell rugs has taken Vallely siblings on magic carpet ride
Selling clearance lines on ebay has turned into a huge business for the Vallelys, writes Maureen Coleman
Published 22/07/2014 | 08:00
When it comes to the rug trade, Co Armagh siblings Paul and Clare Vallely have it covered. Having watched their father sell rugs at market stalls, the pair embarked on a homespun business venture, selling clearance lines on ebay.
A previous attempt to flog ornaments, gifts and toys had proved futile, but surprisingly, for the brother and sister team, the rugs had the magic touch.
After gathering up enough money to travel to Belgium, Paul and Clare made contacts with factories and started ordering directly.
They bought their first container of clearance rugs there for €35,000 (£28,000), selling them on to satisfied customers.
Within six months, they had made £70,000 – with half of the lines still left in the container.
Now, eight years on from their first ebay sale, the Rug House has expanded to become the largest retailer in the UK and Ireland, selling more than 3,000 rugs a week online, across 30 countries.
Just last month the company opened its first retail store at Carnbane Industrial Estate in Newry.
It cost £80,000 to fit-out, and allows them to stock some 1,600 rugs.
And in the autumn, a new £90,000 website, part-funded by Invest NI, will go live.
With up to 6,000 rugs on offer, it is estimated that the website will increase international sales fourfold over the next two years.
Paul Vallely, co-founder of the Rug House, explained how their rug business had taken off.
"When we were younger mum and dad owned a shop that sold all sort of trinkets, cards, candlesticks, things like that, but it lasted less than year," he said.
"Next door was a carpet shop and there was always a steady stream of people dropping by, so when their shop closed, dad went back to the carpet shop, bought a few and took them to local markets to sell them," he said.
"After attending an ebay course, myself and Clare decided to try our hands at selling different things online, like ornaments, gifts and odds and ends.
"Then dad suggested that we try selling rugs. And it worked."
Working from a shed beside their parents' house in rural Co Armagh, the pair bought clearance lines that local distributors couldn't sell.
The rugs were bought cheap and sold at a mark-up, billed as unusual products.
To begin with, sales were slow but long hours and dedication paid off and every penny of profit made was re-invested in stock.
The healthy profit made on the Belgian container spurred Paul and Clare on and in 2008 they launched the company website.
In the same year they were invited to sell on the website Amazon, which gave them an opportunity to expand.
A few months later, they were able to build an extension onto their parents' shed.
It was filled to the brim within 18 months so the Vallelys moved to a 10,000 sq ft warehouse to accommodate their increasing stock.
As business continued to boom, the Rug House moved again, this time to a new warehouse of 25,000 sq ft.
It currently stocks some 120,000 rugs.
Paul said: "Our rugs vary from very modern to standard traditional.
"Most are machine-made, which we source from Belgium, Turkey, India and China.
"The hand-made ones tend to come from India, Pakistan and Iran.
"When we started, selling rugs wasn't a competitive business online, but it is now.
"People tend to shop online when they can't find what they want in a shop."
With their new bricks and mortar store, the Rug House's success is poised to continue. And the new site will be a major bonus as well, drawing in even more international customers.
Paul said: "We're not just buying for the UK and Ireland market now but for customers in Italy, Germany, France and the US. The website will be multi-lingual, multi-currency and will offer advice on things like how to look after your rugs.
"One of the biggest challenges setting up was managing stock manually. But we will be implementing a new stock system later this year, which will improve our stock efficiency by over 60%.
"We currently employ 23 people and we're planning to take on four more."
Paul added: "Our business is built on having rugs that are a little different to everyone else and at prices cheaper than everyone else.
"And all of this is underpinned by outstanding customer service."When we started selling rugs online wasn't a competitive business, but it is now. People shop online when they can't find what they want in a shop