Pier 1 Embraces Impulse Items
By Staff -- Home Textiles Today, 1/28/2008
Fort Worth, Texas — Struggling specialty chain Pier 1 Imports made the case it knows how to achieve turnaround, as evp, cfo Cary Turner told analysts at the Cowen & Company Annual Consumer Conference that in merchandising that will mean "no matter what category you're looking at: impulse items."
Pier 1 cleared goods in the first half of 2007 and brought in 2,000 new skus, Turner said. An example in the furniture department: gone are $900 armoires, in favor of $100 nightstands. (Home textiles make up some 14% of the mix, or $205 million in 2006 according to HTT research.)
Lower price points are the new rule to drive impulse buys and more frequent visits by shoppers, Turner emphasized, adding that Pier 1 is taking a more "judicious approach to promotions."
He said the company plans $110 million in cost savings this year and about $160 million next year, and looks forward to more normalized margins.
Through Dec. 1, Pier 1 posted a net loss of $109.7 million on nine-month sales of $1.08 billion – an improvement on the loss of $168.9 million in the year-ago period.
