R.C. Willey to build Sacramento store
By Clint Engel -- Furniture Today, January 9, 2005
Salt Lake City — R.C. Willey will push into California next year with a 150,000-square-foot store in the Sacramento area.
The retailer, part of Berkshire Hathaway's furniture division, acquired land for the store in the northern suburb of Rocklin and will begin construction in July, said Jeff Child, R.C. Willey president. It's expected to open in summer 2006, less than a year after the retailer opens its first Reno, Nev., store late this summer or early in the fall.
The Rocklin showroom is the first of two to three stores the company is considering for the Sacramento area.
"It's a big market and it flows well from Reno," Child said. "It feels good. We think we can do a lot of business there."
Child said the northern California store will be similar in size to the company's Summerlin, Nev., store — its second Las Vegas-area showroom — and is projected to do about the same in annual sales, $85 million to $100 million a year, including sales of flooring, electronics and appliances. That, combined with the Reno location, eventually should help push R.C. Willey's total volume past $700 million.
The retailer, with 12 stores in Utah, Boise, Idaho, and greater Las Vegas, had sales of about $600 million last year, Child said, with about 60% coming from furniture, bedding and accessories. Business wrapped up on a strong note in 2004 and the company was up for the year in all markets, he said.
In Rocklin, R.C. Willey will build on a 13.5-acre site in the Blue Oaks Town Center development off Highway 65. It also plans to have a distribution center at a separate Sacramento-area location up and running by the time the store opens. The size and other details of the facility haven't been finalized.
"But it will be a fairly good size because we figure that market is large enough to handle more than one store," Child said. "I think it will be two to three stores. We'll get one up then start on another right away, then watch the demographics like we've done in Vegas."
Child and R.C. Willey CEO Scott Hymas noted that the midpriced chain has been interested in Sacramento for years, but, Child said, "We didn't feel like we were ready."
California poses challenges for new and existing businesses, with higher worker compensation expenses, taxes and other costs than R.C. Willey is used to in its other markets.
"We are acting now because we are comfortable with the business climate brought about by the policies of Gov. Arnold Schwarzenegger," Hymas said. "His actions make us excited about coming to northern California."
Berkshire Chairman Warren Buffett was an advisor to Schwarzenegger in his run for governor in 2003.
In Sacramento, as in its nine other full-line stores, R.C. Willey's showroom will feature wide assortments of furniture, bedding and accessories as well as name-brand electronics and appliances. It also will have a flooring center and an on-site car audio installation facility.
Child said there is strong retail competition in the market, but none that duplicates R.C. Willey's one-stop formula for home furnishings, electronics and appliances.
He added that the demographics of the market also are suitable — as the state capital, Sacramento has the solid, stable middle and upper-middle class consumer base the retailer typically targets.
Key suppliers are expected to include its regulars: Broyhill, La-Z-Boy. Thornwood, Universal, Natuzzi, LeatherTrend, Palliser, Schnadig, Cochrane, Benchmade, AICO and Simmons, Serta and Spring Air in bedding.
R.C. Willey had hoped to have its 170,000-square-foot store and warehouse in Reno open by this July or August, but winter storms have hampered the project, Child said. In one day last week, 18 inches of snow piled up and more was expected. Child estimates that store will open in September or October.
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