Big Lots Slams Home Textiles Sameness
May 5, 2008-- Home Textiles Today,
Observing a "lack of innovation and creativity" coming from the soft home industry, Big Lots chairman, ceo and president Steve Fishman said his company is turning its home category focus toward the stronger furniture side of the business, at least for now.
During his presentation at the Lehman Brothers 11th Annual Retail and Restaurant Conference last week, Fishman admitted the 1,353-unit closeout chain's home business — which makes up about 15% of the store's total sales — "hasn't been good," at least in part because Big Lots "has not executed home as well as we've executed other parts of our business."
But the $1.4 billion retailer isn't taking the brunt of the blame for this linens and domestics sales decline.
"The biggest concern I have — and I don't want to be a politician — is that where traditionally you've driven a customer into the home parts of the business, which is linens and domestics, it's absolutely gone," Fishman said. "It's gone all overseas. There is no innovation and creativity coming out of any of the mills. [In fact] there is no such thing as a mill. There are absolutely no mills anymore today. So, as good as the retailer is at creating looks, quality and values, that's what is happening."
He cited some specific home textiles product categories suffering severe price deflation.
"Towels are selling at the same price they did in 1975," Fishman noted. "Sheets are selling for less money than they sold for in the '70s and the '80s. And there hasn't been a reason for the consumer to want to spend money there, to be quite honest with you."
Not all aspects of home have been weak, he said, and the pain many higher-end home retailers are currently feeling at the hands of the weak economy only creates benefits for a closeout chain like Big Lots.
"Because it's so depressed, quite honestly, the availability of some good quality deals are becoming a little bit more prevalent from our perspective," said Fishman. "So because the economy is tougher and because some of the traditional home people are struggling a little, there are some more goods that are becoming available."
He added, "The good news is home is a segment of our business and not all of our business." On the flip side, the Big Lots furniture department has been something to smile about, he said.
Furniture — which also makes up about 15% of Big Lots' total sales — is treated by the retailer as a separate business which Fishman described as "very healthy, thank you very much," attributing this to the retailer's efforts to "do things differently — and we're pursuing what consumers want in the way of values."
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