Pier 1 embraces impulse items
Home Accents Today Staff -- Home Accents Today, January 16, 2008
Fort Worth, Texas – Struggling specialty chain Pier 1 Imports made the case that it knows how to achieve turnaround, as evp, cfo Cary Turner told analysts at the Cowen and Company Annual Consumer Conference today that in merchandising that will mean “no matter what category you’re looking at: impulse items.”
The company cleared out old goods in the first half of 2007 and brought in 2,000 new skus, Turner said. (Home textiles make up some 14% of the mix, or $205 million in 2006 according to HTT.) An example in the furniture department: $900 armoires are gone, in favor of $100 nightstands.
Lower price points are the new rule to drive impulse purchases 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.