Retail conglomerate Williams-Sonoma, Inc., is boosting sales by pruning underperforming stores and investing in new stores, remodels and relocations, while also trying to enhance the store experience, said President and CEO Laura Alber on a second-quarter earnings call.
“Our stores are a key part of our multichannel strategy, as they provide an incomparable experience to our customers to engage with our products in real life,” Alber said.
The company's same-store sales grew by 4.6 percent during the quarter, with Pottery Barn stores posting 2 percent growth, West Elm generating 9.5 percent, Williams-Sonoma reporting 1.6 percent, and Pottery Barn Kids and PBTeen posting 5.7 percent.
Williams-Sonoma has announced plans to open roughly 20 new stores this year, nine of them to be West Elm units. “Our new stores are performing better than the fleet, generating strong profitability with a payback of just over one year,” said Alber. The company also announced that it would close 30 stores, to end the year at 623.
Store opening and closing guidance by retail concept
During the second quarter, the company opened nine stores, four of which were Williams-Sonoma Home stores. Williams-Sonoma now operates nearly 70 of those, which sell furnishings, decor and kitchen merchandise.
The company has plans to open four stores in the third quarter, including a new unit of the Rejuvenation brand, which sells high-end lighting and hardware and which has ambitions to become a multichannel lifestyle brand. Williams-Sonoma says it is looking to have 10 Rejuvenation stores operating by year-end.
“Our fleet of remodeled and relocated stores are also outperforming — averaging double-digit growth in annualized sales over the prior stores,” Alber said. In the Pottery Barn division, the new, remodeled and relocated stores are driving above-average sales growth and profitability in comparison with the older stores, she notes. The company will also remodel two Williams-Sonoma stores in the third quarter.
“This next-generation store has an expanded outdoor-living area that displays a wide range of outdoor collections and more open space for community engagement”
The retailer opened a new-format West Elm store in Santa Monica, Calif. “This next-generation store has an expanded outdoor-living area that displays a wide range of outdoor collections and more open space for community engagement,” said Alber.
On the tech side, the company will be rolling out a photo-realistic space-planning "experience" it calls Ensemble. This concept, which is to go into the West Elm and Pottery Barn stores, will involve sales associates assisting shoppers to design rooms and to choose merchandise. The company says it will also introduce a version of this concept onto its website.
By Brannon Boswell
Executive Editor, Commerce + Communities Today
