Robb & Stucky and the future of high-end retail

This is the story, (see below- blast from the past,) of management in denial, making mistakes and repeating them again and again, putting money and bets on the wrong resources; carved Chinese goods that Michael Amini did a long time ago for the masses (dining rooms went the way of hula-hoop), tired and legacy upholstery resources, and not following a changing market.

Management ultimately making big bets on the sand states' economy turning around, buyers, design directors, and ownership believing they knew more than the consumers; instead of listening to employees who are in direct with clients and consumers combined with bad advertising, over the top- obscene markup, this group of bandits tried everything they could in the name of BIG profits, to shove yesterday's news into homes and a real estate market that just don't exist in these economic times.

High end today is not Robb and Stucky.. It is Restoration Hardware, it is Sklar in contemporary (which R&S never understood,) it is Foliot in Las Vegas, it is revamped ABC, a gritty and tested Baer's family, timely new designers and design shops and more. It is not behemoth box stores, it is cool retro old warehouses with creaky floors well lit and properly displayed. It is understanding where people are living, how they are living, the mindset and respecting their budgets. It is making their heads spin and mind wander when they enter a shop. Consumers CAN live with healthy markup from ownership when they purchase what their expectations are, they won't live with getting ripped off.

It also includes basic proper respect for sales associates and design staff, none of which ever came from their corporate office.


Management merely set the table at R&S; consumers and employees said no to bad expensive food and threw them in the garbage.

P.S.- this management after taking deposits from consumers and telling them to go to Tallahassee to get them back, and ripping off good vendors for millions of dollars that they can never earn back, should never be allowed to re-enter an industry that has provided a great life and living for many honest people....

Personally I don't think this even is the end of high end retail but rather signals a long overdue shift in the public's perception of high end design and styling. Historically heavy carving and overwrought ornamentation were marks of lavish exclusivity. This is because all those intricate design elements were extremely labor intensive and only attainable to the very wealthy. However it's been many years now that those elements have been either sourced from the far east where the labor component is all but free and evokes in the public vague notions of oppression at the hands of totalitarian regimes (kinda of a buzz kill when your in the market for something you can brag to your friends about.) Worse yet these very design elements can be cheaply fabricated through injection molding and finished to look just like an expensive hand carved designs (another unintended consequence of the industry's 8 year obsession with all finishes dark, dark, DARK!) Yet because of the long history of high end and traditional styling, the aspirant consumer of limited means is drawn to these styles regardless of whether they are authentic high end or cheap knock offs. The net effect is that these ludicrously decorative traditional looks are increasingly perceived as low end, ostentatious and gauche. And yet this is the bed Robb and Stucky made for itself.

Today the marks of exclusivity are things like elegant proportions in clean lined designs, high grade raw materials and Western labor (re: North American and European labor - true of high end consumers in China as well as the USA BTW). This is the way trends work: high end leads, the masses follow, high end vacates. Rinse and repeat. Somehow this most obvious of all lessons eluded the folks at Robb and Stucky, who stubbornly persisted in the belief that the high end consumer had a genetic affinity for furniture that somewhat resembles an enormous prehistoric leviathan that might spontaneously animate and devour your family. No, these days that stuff is the domain of guys like Michael Amini with their double breasted suits and floating holograms with bombshell actresses - and most of all a $1699.00 price point for a 400 pound canopy bed (which by the way looks like a lot like a ravenous prehistoric leviathan.)

well,its over now,they are closing all stores the old owners are trying to buy the name ,the suppliers were zapped hard,
what a disaster to behold the demise of such a past powerhouse,they sank the ship with overpriced product and behind the times looks,remember this when the next huge company bites the dust,and lowers the furniture buyers vision of what they buy and pay,its price ,price, price ,not quality or unique product with design and great looks.

the company fail with overspending.i say this coming 4yrs ago.new management came in just spending money .buying unnecessary thing that the co. never had or needed .cars,vans.etc..things we never had . opening new stores in a bad economy just wreckless spending. store in coral gables lasted maybe 1.1/2yrs close las vegas a bust, costa rica a bust,all in the last 4yrs. now we all lose[employees]some with 5 to 25yrs.all we get is a final paycheck to take to unemployment

40 g dining table ,no way, show me this table?rb n stky was not a trend setter nor a style leader they sold expensive borax,and was not giving it away...they were not the end all for florida or any mkt just a retailer w costly goods and designers on staff...the fla. mkt indeed did change from old ladies buying shmaltz to very euro looks which r n b never had or even tried to sell....the mkt changed,china came and destroyed the price and value we once had and know we r stuck with wal mart and ikea left.comments from blast from past were spot on really well written.

IN HE KNOW and BLAST FROM THE PAST know exactly what they are talking about. i can tell you that from my vantage point as one of Robb and Stuckys critical vendors for several decades now, we began to notice in the late 90's Robb and Stucky was changing-and not for the better. My experience with Robb and Stucky is one of close contact. On a weekly basis, they would order furniture from us that was highly customized handmade upholstered pieces that, in order to be made right, required we deal closely with the staff at robb and stucky involved in the order-from start to finish. Multiply that over 20 years and you see alot of things. Reading comments from A BLAST FROM THE PAST helped make sense of many of those things for me. BLAST FROM THE PAST, and IN THE KNOW, whoever you are, thank you.
Now, for those who have deposits down on upholstered furniture that Robb and Stucky did not deliver, my company might be able to help you, especially if we are the manufacturer of that furniture. We are still trying to figure out how to go about doing this but if you are interested in getting the upholstered pieces you had on order with Robb and Stucky, post a comment to that effect and i will reply with some contact information.

a blast from the past comments are correct. the culture of the company changed when a new leadership person took control of the operation and lead the company into the ditch. ironically the same person has lead other companies into the ditch in previous positions.

The reality is that total consumption has shrunk, there are fewer dollars available; consumer dollars are stretched between necessities and discretionary purchases. Do we not understand that the consumer’s budget is not focused upon furniture but is focused on survival? Historically, the Furniture Industry has done a very poor job in creating demand and excitement for its products. Today, we are stuck in the past; 15-20 years ago we promoted $499, $599 & $699 price points for Sofas, Beds and Mattresses while the auto industry sold units at $4500. Today, they have surpassed $15,000 with fewer options yet we are in the same rut. The industry, not the “High End” is in a struggle to find itself. I’d say it’s in a free fall or shall I say the entire country is under the spell of the “Chine Syndrome”; cheap prices on the backs of cheap labor.

MASCO, after their miserable performances from 1984-2001 pushed the industry off shore in an effort to avoid a Billion Dollar + loss; it didn’t. The only reason that MASCO, as an entity, survived is because they had deep pockets way beyond the furniture industry. Otherwise, they would have collapsed as well. In 1995 they took a $660 million charge only to be followed by an additional $550 million in 2001. Their actions were aimed at reducing balance sheet debt created buy over paying for their expansion in to the furniture industry. This debt was created by bad executive decisions. Their goal was to rid themselves of the furniture industry. Their failure was the result of arrogance and ignorance, a lethal combination.

As we know, today’s world is highly political, quick moving and sensitive to the emotions of the immediate. However, “Truth” remains the essence of reality and yet it is rarely heard. The Truth is that any Industry that skirts the truth is doomed to disappointment and failures.

The “High End” of any Industry is a complex topic that allows analyst’s to gain a fortune in compensation for their pontifications. However, the “High End” is equally quite simply. The High End sells to a market that is comprised of a more demanding consumer. They generally demand more sophisticated, innovative and tasteful products that command a higher price.

Beyond the issue of complexity; you need to understand the components that drive the “High End”. The “High End” of any industry is driven by individuals with a visceral drive to supply the Market Place with products that satisfy a demanding buyer. These individuals possess leadership that inspires those around them and a “Taste Level” beyond the average. They possess a talent to organize, lead and promote a culture that feeds the goal. The “High End” leads the industry with vision and creativity. It is also true that each company develops its own style; its own culture; these are the qualities that produce success.

The ‘High End” of the home furnishings industry will be fine. Its course is not defined by one effort, one successful or one failure. However, the reality is that the R&S debacle will have significant financial impact on resources that did not protect their own interests. So how did a highly successful company unravel in 3-4 years? Was it simply related to the collapse of the housing market? If that were the case, there would be no high end at all.

Prior to 1995 the company’s direction was guided by a single individual that appreciated the need for talent at all levels of the organization. The fact is that after 20 years in business the formula for success was significantly altered. In 1996 the daily operations were transferred to an individual that hadn’t the necessary vision, instinct or talent required to direct the company’s “High End” business. He had the power and conviction to lead but was void of the necessary sophistication and appreciation for talent.

The internal culture changed, from an atmosphere that challenged individuals to achieve excellence, to a culture that repressed individuals and managed by intimidation. “My way or the highway” was common place. The “Business Model” is often referred to as a failed or successful way to do business. The term “Business Model” is a current euphemism; a Business Plan was the old way of trying to make the complex simple and the naïve seem sophisticated. Persons rarely understand the full impact of the term and as a senior executive at R&S claimed; their Business Model still viable in today’s market. If that is true, this leaves managerial decisions at the root for their failure and the same management should be replaced.

Either way, if you live in academia lets talk models. If you’re in business you’d better understand, cash flow, a P&L, a balance sheet, ROI, inventory levels, line ups, assortments, mark up, personnel, margins, changing market conditions, expansion planning, marketing, advertising and controlling expenses. Sales cure a lot of ills but when costs exceed revenues any company needs to react quickly; they didn’t!

In the case of R & S, as Arrogance and Ego replaced Respect and Rational thought, the customers, employees and suppliers became the victims and their eventual collapse became inevitable, a fate beginning some 15 years ago; March the 7th will tell the tale!

Most of the commentors are missing a very important point in the R&S autopsy. While the economy played a big role and the 50% drop in sales was shocking, it was not unusual to that sort of result for many retailers in their main markets. Another issue that seems to be confused is the Made in America one. While R&S proudly marketed high end merchandise their mix was far from 100% domestic. I know a lot of their suppliers - and even know R&S management. They purchased a lot of sourced product and the consumer eventually turned their backs on stuff that was overpriced relative to the quality. Now for the "missing link". It has long been known that R&S struggled with high rents and rotten sales in many of their markets. If they had stayed a South Florida retailer they might have survived with some cost management. When you borrow a lot of money and pay big rents in places like Las Vegas you are going to have a tough time surviving recession.

When sales are down by 50% you have to know you have a problem. Management tried too little too late but over the last year the handwriting was on the wall. Suppliers knew that they were playing with fire because R&S was notorious for their slow pay to suppliers. Suppliers were frankly afraid to pull the plug because they not only would be removed from the stores but their payments might get even slower. So there are few tears in the industry for suppliers that will lose big time.
The high end is evolving to a designer based market but not one based in showrooms. We are seeing the rebirth of a cottage industry and there is still plenty of life out here for the smart people.

R&S is and was a partner to this industry that made many of people wealthy. These people were the owners, some employees within, suppliers and the suppliers salesforces as well. However, highend as you all speak isn't dead, it has simply changed. Perhaps as R&S dipped down into some more medium price points they didn't dip far enough. Perhaps as the storm of an economic down turn had began they should have battoned down the hatches and rode it out. Perhaps they should have, could have, or would have...but they didn't. However, talking about their failures and trying to place blame does nothing for our industry that is already down. Talking about the positives we all might be experienceing is what is most important. Even if you don't think you are experiencing any positive think about it...maybe traffic through your doors still, maybe a great ad or sale that brought you a different customer, or even how if you are a retailer in the R&S market places you now have an opportunity to grow. I'm sick of all the negative we see everyday from the mess in the eastern part of the world, gas prices climbing, even down to negative buzz in our industry. I believe positive breeds positive. Don't you think your customers want to buy something fromsomeone that is positive, do you want to buy something from someone that is negative? Enjoy your work, enjoy your industry, enjoy your day! Let your customers enjoy and your sales will reap the rewards. Forget about R&S and learn from waht they did and realize it is your gain.

In the short term, what happens to the customers who have %50 down on an order that is now frozen? I'm lucky, I only have $299 to lose on an ottoman. But I received the $5299 sectional by the skin of my teeth (2/23/11).
Hopefully my store stays open, and the orders get moving again, or I file a claim by 5/4/11, and keep my fingers crossed...
The long term effect for future special-order furniture customers who help keep the manufacturers in business? Once bitten, twice shy.

Sorry to see any store or group fall to this precipitous economy...regardless of the niche they specialized in. R&S wasn't around as long as they were because they DIDNT provide value/service to their targeted share of the consumer pie...obviously...what they did NOT do was adjust their strategies regarding sourcing and the decline of the overall market. I am involved with a concern that recocgnized early in the financial downturn that it was better to for us to tighten our wallets, forego some operations...and utilize the globe when sourcing. Offering goods produced entirely in the USA is a hurdle that any Top 100 player would have trouble 'making work' right now. For the suppliers, more and more of these entites who file for protection...re-organization...well...it could be the death nell for many of them...to all those who work for R&S...I wish you the best in these very troubling times...and so it goes...

R&S is hardly an arbitor of good taste. They focused on over-the-top schmaltz which quickly dropped out of favor when the economy shrunk, and they didn't adjust. It didn't help that they were in the hardest-hit geographic areas. It's a shame that suppliers allowed themselves to get so far into the hole with R&S. Maintaining a strict credit limit is a good idea for any supplier - don't fall for promises!

Dear All: At the end of the day if your business model is not yielding a profit you must initiate action to "Right the Business". In a declining market as our industry has been, there remains a reality daily that this must be addressed. If PFP can liquidate the stock inventory it will be the best option to raise any forms of cash. By the way, who can really define high end today ? If you look around hard enough you can see it is generally defined by a price tag only. In addition, our industry is going to an e-comm base with new buyers and a new generation of buyers that are tech savy. Retail stores will and are becoming concumer showrooms. Watch the economics, the oil prices, consumer confidence, unemployment rate in your regions, congress dead lock, banks and there willingness to invest in our industry, foreclosure rates. commercial property inventories, regular exisiting home new listings in your area, decline in new homes being built, and you will see some reasons to right size and quickly. It is not negative my friends, it is very real, I live it too as a large distributor and the risk we all face daily to run a business and build cash or stock equity is a massive challange. Keep climbing, be careful in your cost and fixed over heads regardless if you are a retailer that is high end, low end, medium end, or what have you. It is a continuing long path for us and Asia is now our sources and domestic names at high end mean nothing, it is price driven out there to consumers. Thanks to all the manufacturers and suppliers that drove dollar per sq. ft. at retail down to the under lying bottom. You can't come back up from that easily and I am confident that R & S had this issue from some competition etc. Let alone economics over all in various states. It is a challange. I wish every one a promised future though.

It is tough in High-End now, and for the last 2+ years, but the category is still alive. The definition of High-End is changing for sure.
I just hate to hear all this China-bashing. China's doing a great job with case goods. A big factor is that the consumer now realizes a $40,000 dining room isn't ten times better than a $4,000 one. Maybe twice as good??
Another thing Combs noted is that single market dealers are apparently doing better than R&S, who stretched from Florida to Vegas. Our experience has been that it's hard to merchandise two stores 400 miles apart, much less 2,000. Too many regional differences.
High-End will survive, just in a different form in single-market stores.

Robb & Stucky does not mean the loss of all High End Retail...we are a High End Retailer doing just fine, and it will continue to only get better! I am sad for the Vendors, that will not get paid, as we also pay our bills in Net 30! We will survive, and continue to grow and Higher End Retail is doing just fine!

The company made bets in places that got hit harder than Florida. Its management never anticipated such a weak real estate market. They started tightening in 2008, but their store locations were too weak overall. They would best be absorbed by a retailer that has strength in other markets with a long term view of Florida. However, liquidation is most likely. They supplied Florida what its snowbirds wanted, but their migration has stopped and the Europeans, Russians, and South Americans coming in now are looking for something else.

After all has been said and done, it is distressing to witness the demise of a Top 100 and it does have trickle down effect. "Business as usual" is a thing of the past. Retailers must be innovative, tuned into the needs and wants of their consumers/marketplace, and congnizant of the economy we live in. Easy to write; hard to accomplish.

Dear "concerned veteran" and "R&Semp",

Say what you will but a failed business model that did not change during one of the most challenging economic times led to the demise of R&S.

Who is R & B?

As a long term employee of Robb & Stucky I am struck at the ignorance that was posted stating that R & S was business as usual...I watched as several of my co-workers in my store alone lost their jobs. Not to mention the HUNDREDS of others that I did not personaly know that also fell victim to this economy.
I am proud to say that I work for a company that has as much integrity as Robb & Stucky does and will be standing with my company through thick and thin. And as for the smell of cookies, yes, that is was we consider sensational customer service, which is what this company has been biult on for 90+ years. There are countless factories that will suffer to point of closing their doors if Robb & Stucky were to fall from exsistance...many of whom are indeed still made in the USA. Making product in the USA is much more expensive than importing from China, which is why the high end retailer is so important.I would like to see a low end furniture store bring the value and craftsmanship that R & S has.

As a long term employee of Robb & Stucky I am struck at the ignorance that was posted stating that R & S was business as usual...I watched as several of my co-workers in my store alone lost their jobs. Not to mention the HUNDREDS of others that I did not personaly know that also fell victim to this economy.
I am proud to say that I work for a company that has as much integrity as Robb & Stucky does and will be standing with my company through thick and thin. And as for the smell of cookies, yes, that is was we consider sensational customer service, which is what this company has been biult on for 90+ years. There are countless factories that will suffer to point of closing their doors if Robb & Stucky were to fall from exsistance...many of whom are indeed still made in the USA. Making product in the USA is much more expensive than importing from China, which is why the high end retailer is so important.I would like to see a low end furniture store bring the value and craftsmanship that R & S has.

The industry will sorely miss a retailer like R&S. I do not know how "industry veteran" and THOM can say that R&S was not a style leader. R&S may have made mistakes, but everyone that either sells or retails upper end furniture would only say great things about how they merchandised their floors. It was always a point of pride if you could say your company was a supplier to R&S. The comments from both of these respondents sounds like sour grapes.

Where did you ever get the idea that Robb& Stuckey was a trend setter and a fashion leader? Please specifically elucidate on this with examples.

R & B specialized in over priced schmaltz design for the nouveau riche whose social insecurity inspired a strong need to find ways to show off that they had money. The most memorable thing in their stores was the smell of baking chocolate chip cookies. Their taste was in their teeth and not in their aesthetics. R & B symbolized the tasteless era and the mentality of all those Wall Street derivative billionaire robbers and Bernie Madoff. Their demise will not affect the high end other than to leave it to hopefully more tasteful vendors.

The entire fabric of distribution of our industry has unravelled and no one is paying any consequential attention to it including this publication. We now have more production capacity than we have retail/wholesale floor space to sell it. Has anyone noticed how hard it is to find anything other than a mass merchant vendor anymore?

If anyone is actually left manufacturing in the US,how will they survive without a solid dealer base using the present business strategies? The industry needs to rebirth itself before it is totally handed over to Asia. Why should the world want to go to High Point or Las Vegas to see Asian merchandise? Robb & Stuckey was stuck in its old un-evolving business model just like the entire industry is. Mindless repetitions with no direction other than repeating the past.

When the economy got bad and retailers, vendors and even consumers tightened their belts, what did Robb & Stucky do? Reduced revenue should mean "have a game plan". They seemed to be "business as usual"..

They were labeled overpriced in which the consumer nick named them "Rob and stick it to ya"

Consumers who want high end products will just have to do a little bit more research. There are plenty of retailers that will gain from their loss.. Lines will open up and the consumer may actually get the same product for a lower price...

One mans loss is another mans gain..