Eurway to expand with two new stores
By Clint Engel -- Furniture Today, March 11, 2007
Dallas — Eurway Modern Home & Office will open two stores this year, including its first outside Texas, in an expansion fueled and directed by its online sales success.
The family-owned specialty retailer of midpriced, ready-to-assemble, European-style contemporary furniture will open a 15,000-square-foot store in the new Shops at Preston Ridge in Frisco, Texas, in early April.
Later that month, it will open a 40,000-square-foot Tempe, Ariz., showroom and warehouse at Interstate 10 and Warner Road in the new Emerald Design Center.
Eurway currently has three Texas stores, in Dallas, Austin and Houston. The nearest store to Tempe is the flagship Dallas showroom, its highest-volume unit, about 1,000 miles away.
The company, led by President Gary Greeson and his sister and Chief Development Officer Gigi Correll, had sales of about $30 million last year and is projecting sales of about $40 million this year, including partial-year sales from the two new stores.
The new stores are Eurway's first since it entered Houston in 1999, and are just the beginning of a new strategy that could take the company national in a few years.
"Right now, our expansion is geared a lot around our customer tracking on our Internet sales," Greeson said. "We're doing quite well with our Internet business."
With the ZIP-code tracking and studies that Eurway has conducted with the help of real estate consultants, it knows where it needs to locate new stores to build on that online success.
Eurway currently is using its own cash for expansion, a combined investment this year of about $1.5 million, Greeson said. "As money becomes available, we hope to do a couple of stores a year."
As momentum builds, that number could grow, he added.
Greeson wouldn't disclose Eurway's online sales, but said they've grown an average of 40% a year since the company added a shopping cart to its Web site in 2001, while store business is growing at a rate of about 10% to 12% a year.
Returns — a concern for many in the industry looking at e-commerce — have not been much of an issue, Greeson said. The company tries to be proactive in that area; its call center is manned by employees with experience in both logistics and sales. They can "pretty much resell the customer online and have been able to keep returns to a very small percentage — less than 4%," he said.
Key suppliers include Natuzzi, Actona, Amisco, Cellini Designs, Tvilum-Scanbirk and Restonic in bedding. Eurway also has a proprietary visco-elastic bedding line sourced from China.
With Eurway's Internet sales particularly strong on the East and West coasts, next year the company will jump to the East Coast to open two stores, Greeson said, although he wouldn't name the markets he's considering.
Tempe has been a very hot market for Eurway online, he said. Frisco was just a ripe opportunity to take advantage of the retailer's strong home market, Dallas, as the metro's population continues to move north.
In both cases, Eurway will be located across the street from large Ikea stores, with which Eurway matches up well, Greeson said.
"We're in the buy-it-and-take-it-home-now model like Ikea, but we feel our salespeople have a greater knowledge of what they're selling," he said. Eurway offers similar knock-down European contemporary styles, but believes "customer service is much more a part of the buying process" and that its quality is better," he added.
Eurway's showrooms are about 15,000 square feet, and each has a large attached warehouse for delivery and customer pickups. The Frisco store will be an exception. Greeson said space there was difficult to come by so nearly all 15,000 square feet is dedicated to display. Its Dallas store, a 15-minute drive south, will handle deliveries and most pickups for both locations.
The Tempe warehouse will now handle the majority of online sales to the West Coast, Greeson said.
With each store handling its own distribution, he said Eurway's expansion is not limited geographically. "We are hoping to be, potentially, nationwide," he said. "We have found this type of furniture is desirable in all parts of the country."
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