Cost Plus seeks smarter home mix
Thomas Russell -- Furniture Today, November 17, 2006
Oakland, Calif. – Cost Plus Inc. has seen its home business sales tumble and is reacting by streamlining sku count in the coming months, the variety retailer said during its third-quarter conference call.
Barry Feld, president and ceo of the 286-unit chain, noted that since the earlier quarter, “We have seen an acceleration of the deterioration of the home side. And when you look at home décor and home furnishings, particular high-priced furniture, it is definitely putting pressure on our overall store volume.” The solution? To “migrate away” from high-ticket furniture pieces and reduce furniture sku count.
The company reported a third-quarter net loss of $11.7 million, compared to the loss of $2.7 million for the same period last year. Revenues grew 7.3% to $215.4 million from $200.7 million last year, while same-store sales for the quarter decreased 1.3% compared to a 4.7% decrease last year.
While consumables departments have improved, said Feld, “Our focus for the near term will be to continue to strengthen the home décor and furnishings side of our business and implement initiatives to improve profitability."
Cost Plus also plans to cross-merchandise its home accent pieces to more areas throughout the store to try to boost home product sales overall. “I’m glad we have a lot of other levers to pull on throughout the store to drive customer traffic,” Feld said.
With regards to the still-vacant top merchant position, Feld said Cost Plus has done “a lot of retooling internally below [the top merchant position], and my plan is to have a permanent solution and structure that I will announce before the end of this fiscal year.”
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