Havertys steps up growth
Clint Engel -- Furniture Today, March 7, 2012
ATLANTA - Havertys says it plans to open four stores and will increase its selling square footage in a major way for the first time in four years.
The Atlanta-based Top 100 company is beefing up its three largest markets with new stores coming in the second half of this year in greater Dallas, the Baltimore/ Washington area and the Atlanta market, the latter a relocation of its Southlake Mall store.
Havertys also will enter Midland, Texas, the heart of oil country and a market the retailer has had its eye on for a while, said Clarence Smith, president and CEO.
In a conference call with the investment community and later in an interview with Furniture/Today, Smith said Havertys is strengthening its brand in majors markets and moving into the growth areas of markets where it wants to reach more consumers shopping in the middle and upper middle price points.
During the third quarter in Baltimore, Havertys will open a leased 38,000-square-foot store on Joppa Road in the Towson Marketplace power center near Towson Town Center Mall. While the company has a D.C.-area presence, this will be its first location in Baltimore proper, Smith said.
Also in the third quarter, Havertys plans to open the Midland store in another leased venue, a 28,000- square-foot former Circuit City.
Havertys already operates in west Texas in Amarillo and Lubbock, but has wanted a store in the Midland/Odessa area "for a good while, and this in an opportunity that became available," Smith said.
The retailer will follow at the end of the year with a 50,000-square-foot Allen, Texas, store in The Village at Allen. Havertys will occupy an existing shell building on Highway 75 in this fast-growing suburb northeast of Dallas.
Also in the fourth quarter, the retailer will open a 25,000-square-foot store - a new building that Havertys will own - in South Point Center in McDonough, Ga., south of Atlanta at Interstate 75 and State Road 20. Smith said this has been another fast growing area, and although growth has slowed recently, it's "where our best customers, who shop our current store in Southlake Mall, live."
The Southlake store - roughly the same size as the planned new showroom - will close when its lease expires this year.
All told, Havertys expects to grow its store count to 122 showrooms from the current 119 and increase its selling square footage by about 2.5%, its first significant increase in four years, Smith said. The retailer did add some selling space last year, too, but the growth was only 0.4%, he added.
"We're excited about these locations and ... about strengthening our best markets," Smith said. He wouldn't disclose sales projections for the new stores.
On the conference call, he also noted plans to renovate and upgrade 20 existing stores this year under its Bright Inspirations program.
He added that with the retailer's focus on new marketing and store presentation, the company has set a goal to improve sales per square foot back to more than $200 from the $148 average last year.
He also suggested that Havertys is trying to lessen the impact of the industry's close ties to the still-suffering housing market by appealing more to consumers who are looking to update their existing homes rather than buy new ones.
"What we're focusing on is the replacement market. We like to use the term rejuvenation," he said, noting, among other things the company's recent hiring of a new creative advertising agency and some adjustment of its merchandise mix to better reach this type of consumer. The moves include focusing on products tied to the public rooms of the house, such as motion, leather upholstery and sectionals for family rooms, but also the not-so-public bedroom and a mattress category that has been hot for industry and appeals to consumers in replacement mode.
Industry Related Content
Furniture Today's Ray Allegrezza Speaks with Stephen Bogart about Fine Furniture's New Bogart Line