Pirch to close most new stores and focus on design sales

Dive Brief:

Upstart appliance retailer Pirch will close most of its showrooms and has begun negotiating with landlords on the East Coast and Midwest, a company spokesperson confirmed to Retail Dive.
The company is dialing back to focus on its original operations in California, where stores are profitable and growing, a company source told Retail Dive. Stores in Dallas, Chicago, Austin, Paramus, NJ, and Atlanta, will close Sept. 30. The showroom in New York’s SoHo neighborhood is also performing well and the company is evaluating its options for that space, according to a company statement emailed to Retail Dive. A decision is expected in a matter of weeks.
All orders from all stores, even those slated to shutter, will be fulfilled as planned, according to the statement. Back operations headquartered in California remain in full gear, so customer service remains available, the company source said.

Dive Insight:

“Joy” has been part of Pirch’s pitch from the beginning, and the retailer has been lauded as a retail playground of sorts, allowing shoppers to actually try out appliances and watch chefs prepare food using more than a dozen kitchen equipment displays, among other working systems. They could because, unlike in typical showrooms, water flowed from faucets and flames flickered on stoves.

But the excitement of that brick-and-mortar experience—singled out by the likes of “retail prophet” Doug Stephens as a prime example of what retailers must do in today’s challenging environment—is a high-cost effort, the company source told Retail Dive. This year alone, Pirch was lauded as a KBIS Innovative Showroom Awards Finalist in the Multi Location Retail Showroom Category and a SoHo Innovative Showroom Finalist, as Fast Company World’s Most Innovative Companies in Retail Sector, a finalist in the World Retail Awards Best In-store Customer Experience Initiative, as one of Thought Works Inc.’s Top Ten Stores to Visit and on Inc. Magazine’s list of “25 Most Disruptive Companies of the Year.”

For high-ticket items like appliances, stores outside of California, where the company’s core base is found among architects, builders, interior designers that return for multiple clients, purchase volume among even the many enthusiastic retail shoppers wasn’t enough to balance the expense of having working appliances on the floor, the company said. The stores in Dallas, Chicago, Austin, Paramus, NJ, and Atlanta are all in malls, which are less likely to cater to design professionals.

“Pirch has made the strategic decision to re-focus its footprint and pace of expansion,” the company said in its statement. “Our California stores are performing well and we remain focused on growth in this region. In other regions, PIRCH is currently in discussions with landlords and has begun the process of closing certain locations that have not met our expectations.”

But the company remains dedicated to its approach, according to that statement, and the company source described the regrouping effort as a repositioning of its real estate and location approach, and not of the brand. “We remain confident that our unique business model will be successful on a more focused scale, and we are committed to delivering on our founding mission of providing customers exciting new ways to shop for the home through our innovative multi-brand immersion experience,” the company said.