Dive Brief:
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Restoration Hardware last week reported Q4 revenues rose 23.5% to $582.7 million and gross margins and operating margins increased. Same-store Q4 revenue rose 24%.
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Catalog and e-commerce sales rose 33%, a bit more than half (52%) of total revenues. The retailer said that it will recover from a negative impact from the labor dispute at West Coast ports in Q1.
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The company warned that the coming year will see lower profits because of its dedication to growth, opening new business, including its long anticipated Kitchen and Table line, and revamping stores and its home delivery services. The retailer called 2015 a “bridge year.”
Dive Insight:
Restoration Hardware is an example of a retailer that is finding plenty of success ignoring many of the conventional wisdom of today’s retail world — it’s not just dedicated to its brick-and-mortar strategy but expanding it, not just dedicated to its huge paper catalog but also expanding it, and has left its social media strategy to its customers and fans.
That may have a lot to do with its core business (furniture) and its target customer (wealthy). But the company is also taking the long view.
"We have to look beyond these (trading) bumps... (and) short-term thinking. What we are building here is a really durable building, that will stand the test of time and that will dominate its marketplace," CEO Gary Friedman told analysts Thursday.
