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Restoration Hardware Adds Custom Programs, Refines Mix

By Michele SanFilippo -- Home Textiles Today, 9/5/2005

Corte Madera, Calif. —Restoration Hardware has created an integrated color merchandising approach with new fixtures to stimulate customers to purchase across categories and unveiled new customized programs in home.

The company has introduced an “our drapery, your style” program in window fabrics like Thai silk, Belgian linen and others to be offered in French pleat, inverted pleat and flat panel constructions.

In addition, it has reintroduced its “our sofa, your style” program featuring 55 custom fabrics and eight leather selections. A new one-to-two-week in-stock upholstery delivery is now available in all major markets.

Restoration Hardware has also developed a new online “design your own lighting” program that allows consumers to customize their lamp shades with six different styles in six sizes and eight colors. All lamp shades are color matched to the company's window treatments and linen selections.

“We believe we offer the most compelling assortment in this (custom) category outside the interior design trade,” stated Gary Friedman, chairman, president and CEO. “These latest efforts/investments position Restoration Hardware as 'the destination' for our core categories and will enable us to continue to gain market share, increase store productivity and improve merchandise margins with a less seasonal, higher margin assortment.”

The retailer has eliminated garden, games, electronics and the majority of accessories to focus on core businesses. It has also significantly reduced its non-core fringe categories that typically perform well during the peak five-week holiday period, per executives. But a new home accessories category will flow into stores later in the season.

According to Friedman, “The decision to edit and focus the assortment and sacrifice some of the fourth-quarter upside will result in a clearly positioned and more profitable year-round Restoration Hardware business.” He added that these efforts will also have long-term benefits toward simplifying execution in the supply chain and stores.

“The gift business is still important to us as long as it is relevant to the core businesses Restoration Hardware now stands for,” described Friedman, adding that holiday trim and décor, holiday home and stocking stuffers will still be part of the seasonal assortment. Next year, the company will expand its bath accessories business to include giftable items like high-end frames, candles and entertainment products.

Restoration Hardware will also add two more outlet stores in the second half to move through distressed inventory and returned goods, bringing its total number to five. All remodels have been completed apart from the Vancouver, Boston and Flatiron New York stores, which are currently being refurbished.

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