Wayfair to open its first brick & mortar store
Wayfair, the largest online furniture retailer in the U.S. with $6 billion in annual revenues, is following in the steps of numerous other e-tailers in opening its first brick and mortar store.
The site of the store is in Florence, KY outside of Cincinnati, according to Furniture Today. The 20,000-square-foot outlet store will be given its own space within a 260,000-square-foot distribution center being constructed to handle Wayfair’s growing online business.
The outlet location is being set up to sell excess inventory, including products returned to the e-tailer. An article on Forbes contends that returns to Wayfair are “excessive” compared to the high rates seen by other online sellers.
The decision to open a store is a departure for Wayfair, which has touted the superiority of the online model on its site and in public pronouncements by company executives.
A Wayfair locations page tells visitors that the company doesn’t operate any stores, but is accessible anywhere in the U.S. to anyone with an internet connection. “No more searching ‘Wayfair near me’ or planning an all-day family trip to a furniture store to shop,” reads the copy on the site.
Nearly a year ago on an earnings call, Wayfair CEO Niraj Shah highlighted the growth rate of active users on the site and double- and triple-digit increases in revenues in the U.S. and abroad.
“The wind is at our backs if consumers increasingly embrace the selection and convenience of shopping online instead of in physical brick and mortar stores,” Mr. Shah told analysts last August. “The customer experience that we offer and the consumer brand that we’ve created are resonating, allowing us to continue to acquire new customers within our payback targets and stimulate more repeat purchases from our existing base of customers.”
- Wayfair Locations – Wayfair
- Wayfair opening 20K-square-foot outlet store – Furniture Today
- Never Say Never: Wayfair Opening Its First Store – Forbes
- Is Wayfair Amazon-proof? – RetailWire
DISCUSSION QUESTIONS: Does the decision by Wayfair to open an outlet store amount to an admission that an online-only operation is not sufficient to reach profitability in the furniture category? Do you expect Wayfair to stick to outlets to sell off excess inventory and returns, or also open regular stores to complement its online operations?