After opening what is arguably the best new home furnishings specialty store the industry has seen in years, Crate & Barrel has an aggressive agenda for 2024. On the menu? More new stores, better integration amongst its brands, and a few surprises.
In an interview with Business of Home, CEO of Crate & Barrel Holdings Janet Hayes laid out the retailer’s plans and shared some lessons learned from its sprawling new location in Manhattan’s Flatiron District. The two-story space features soaring interiors and a freshly merchandised layout that gives a much more prominent role to its in-store designers—all housed in a historic 1860s building. Hayes has called it the future of the brand.
“I love our model,” she says. “We’re not closing stores—we’re opening new stores. And digital is now over 60 percent of our business. We’re keeping our focus on the consumer.”
Hayes, a veteran of the Williams-Sonoma group, where she rose to president after spending six years in various Pottery Barn divisions, says sales were up 23 percent in Crate & Barrel’s last fiscal year “and we are looking for continued growth this year with potential for all our brands.”
Those brands include the flagship, which marked its 60th anniversary in 2022; Crate & Kids, which used to go by Land of Nod; CB2; and Hudson Grace, a boutique purveyor of home decor. Spread out among its many nameplates, Crate & Barrel now has about 110 locations in North America, as well as franchised stores outside the U.S. All together, the company, privately owned by the Germany-based Otto Group, does a reported $2.5 billion in annual sales.
Hayes says more of everything is on the way. Here are some highlights from the conversation:
There will be three Crate & Barrel stores opening this year, in Florida, Texas and Arizona, and they will reflect some of the learnings from the new Flatiron location, says Hayes. “We now have a working menu to use in our new stores and in remodeling existing ones.”
An emphasis on design
The Flatiron store is doing 20 percent more business in 40 percent less space than the SoHo one it replaced, says Hayes, with its in-house staff of 30 designers driving a lot of that growth. A design desk is featured prominently at the front of the space, with additional workstations on the lower level, adjacent to the furniture area. “We centered it at the front window so people could see it when they walked or drove by,” she explains. “We have almost triple the number of design appointments we used to have in the old store.”
The retailer continues to emphasize its total-home approach, with categories that most of its competitors don’t have, such as housewares and kitchen and bath. “It gives us an advantage, and we’re adding things like more lighting, hardware and bath vanities,” says Hayes, who explains that the strategy also allows Crate & Barrel to grow its hospitality and to-the-trade business. Another trade-focused perk: The Manhattan store has a fresh-flower department, something that distinguishes it in the eyes of restaurant and hotel clients as well as residential customers.
Not to be forgotten...
CB2, which Hayes admits had been a neglected brand under previous management, has just gotten its first app, and it, too, is expanding its assortments in lighting and hardware. The location on the east side of Manhattan has been remodeled, but no additional stores are in the works at the moment.
An e-commerce push
Hudson Grace—which has 10 pocket-size stores that revolve around tabletop, small home decor items and a touch of food—is getting an expanded digital side.
All the brands will continue to become better integrated and cross-referenced with the consumer, an initiative that began with the launch of a registry that serves both Crate & Barrel and CB2, a first for the company. “We want to unify all our brands to a common platform and take what we have learned and use that across all our brands,” says Hayes. Back-end operations will also be integrated, including delivery services.
If that sounds like a lot of change, well, it is. “We can’t stick with any sacred cows,” says Hayes. “We’ve learned how to put the customer at the center of everything we do across all our brands.”
Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.