'Manutailer' H.D. Buttercup expects to blossom
By Clint Engel -- Furniture Today, March 13, 2006
Culver City, Calif. — Riding the early success of H.D. Buttercup here, founder and CEO Evan Cole plans to expand the store this year and roll out the "manutailer" concept with up to 20 more locations in the next five years.
The company says the 100,000-square-foot store, which opened in May 2005, was profitable by its fourth month and was projected to do $19 million in sales in its first year. The venture was financed solely by Cole, the former CEO of ABC Carpet and Home in New York.
Located in the old Helms Bakery Building in west Los Angeles, H.D. Buttercup has about 57 vendor displays — everything from midpriced to upscale furniture to books to artwork, jewelry and apparel — where manufacturers sell directly to the consumer.
H.D. Buttercup isn't disclosing locations for future stores or its projected investment in the expansion plan. President Kimberly Ventre said the company hopes to open the second one within about 18 months.
Ventre, an advertising executive with The Gap before joining Cole in the new venture, said H.D. Buttercup is targeting five to 10 major metropolitan areas, such as New York, Chicago, Washington, San Francisco and Miami.
She said the second store is expected to be up to 300,000 square feet and would probably open in phases, starting with 100,000 to 150,000 square feet.
A 40,000-square-foot expansion to the first showroom, along with a 150-seat restaurant, bar and sidewalk café run by an independent restaurateur, is expected to open by early summer. Also this year, the retailer will launch an in-house design service. Ventre said it's too soon to estimate how many additional suppliers will be showing with the expansion.
"We're re-evaluating all the space in the store and trying to perfect the customer journey," she said.
Cole's idea behind H.D. Buttercup is to provide a bridge between manufacturers and consumers, who he believes cannot see complete lines at typical home furnishings stores. The displays range from kiosks smaller than 200 square feet to anchor spaces of up to 8,000 square feet.
Manufacturers don't pay rent, and pay a percentage of sales (generally between 30% and 50%) to H.D. Buttercup, based on how involved the retailer is in operating their spaces and providing warehousing, construction, maintenance, marketing, advertising and sales staffing services.
H.D. Buttercup is intended to be a "brand incubator," Ventre said, "giving manufacturers the opportunity to become completely vertically integrated and become retailers."
She said small and midsized manufacturers are the best partners for the concept because it lets them show their collections the way they want them shown, without a retailer's editing and with little risk.
"And the end consumer benefits because they get to see new and exciting home fashions," Ventre said.
Furniture "manutailers" listed in the first store are Aaron Thomas Plastics, Against the Grain, Alphaville, Asia Minor, Blue Fish, Blu Dot, Casa de Campo, Central Station, Costantini Design, Directions, Era, Ethnicraft, Floor Model, Haute House, In Home, Khyber Pass, Material Culture, Spazio Di Vita, Team HC, Teo, Twenty Gauge and Wabi Sabi.
Asked if distribution issues have kept some manufacturers from signing on, Ventre said that has been the biggest fear among companies who are not participating.
"I think in any industry there is always some fearfulness associated with a new way of doing business," she said. But at the same time, she added, "you are always going to find people who want to try something new."
