Running counter to the broad current retail strategy of moving downmarket and playing the “value” card, Restoration Hardware is doing the opposite, opening the Flatiron Gallery as the flagship of its new upmarket Artisan Collection.
The store, which opens today and replaces an existing Resto location in New York’s Flatiron district, features a large selection of handmade furniture and home accents, complemented by one-of-a-kind vintage pieces and existing merchandise from the Restoration line. About 30 percent of the product was developed expressly for the new format at prices that range from 20 to 30 percent above comparable merchandise in traditional company stores. Carryover product is mainly in the textiles and plumbing categories.
The store, which also features a Baby & Child store-in-store on the lower level, is more sparsely merchandised than existing Resto units, with darker walls and statement pieces throughout the selling floor. The concept was given a soft rollout at another company store in Corte Medera, Calif., near corporate headquarters last month. While Resto expects to expand the concept there are no additional units in process as of yet.
“When the whole world changed eight or nine months ago, we decided to go to the road less traveled,” said Gary Friedman, the chief executive officer who has led the company since 2001. “We decided we wanted to go with ‘best of planet’ products rather than value, which everyone knows is a codeword for cheap. We said if we’re going down, we’re going to do it with style.”
The initial rollout of this strategy actually began earlier this year in the Restoration Hardware catalog and product mix when a collection of 22 pieces were introduced, featuring handmade products including a reproduction industrial cart-cum-coffee table that was on the catalog cover. The products sold well, said Ian Sears, chief marketing officer. “We hit a vein and we said how do we do more things like that.”
Friedman, Sears and their team traveled the world over the past six months finding product for the new store. Some pieces, like a giant mirror fashioned after an old clock, are reproductions of items Friedman himself owns. “Everything is a reproduction or repurposed,” said Friedman, pointing to a dining table with the look of an old wooden door. The product development cycle was cut from 18 months down to five or six to get products to market faster.
“Once we had curated the collection we said we needed a new setting to present them,” he said, providing the genesis for the new store. “It’s a pretty big leap for almost anybody.”
Restoration Hardware, which was acquired by private investors in 2007, has 99 stores and 13 outlets in the U.S. and Canada. Friedman, when asked if pulling off a project like this is easier now that the company is private, said, “This allows me to focus on product instead of Wall Street. But I still have to answer to our investors.”