If you thought Texas companies abhor California, think again.
At Home from the Dallas suburb of Plano is launching a major push into California’s home furnishings market. A new 85,000-square-foot store at Foothill Ranch Towne Center just off the 241 toll road in Lake Forest opened this month.
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The new At Home store in Foothill Ranch, CA will have its official opening on Saturday, March 30, 2019. The 75,000 square foot store promotes itself as a home decor superstore. (Photo by Paul Bersebach, Orange County Register/SCNG)
It’s the start of 80 stores planned for California, five by year’s end. Poway will get the next At Home in Southern California, followed by Long Beach, Temecula and Riverside.
“California is an amazing state of economic opportunities,” says CEO Lewis “Lee” Bird, who’s tripled the chain’s store count to 186 in his six years with At Home. “Great economy. Fantastic tastes. And residents who love to decorate. We can be their value option.”
At Home stores are huge for the home-furnishing category. Their 50,000 products come in numerous fashion styles, and 70 percent are non-branded. Bird — with plans to grow the business to 600 stores nationwide — also insists At Home is the industry’s price leader.
The chain’s offerings — everything from rugs to furniture to wall hangings, lights and patio decor — are spread out on a sales space that’s roughly half the size of a typical Costco. Or, ponder the competition: At Home stores are roughly seven times bigger than a typical Pier 1 or Bed, Bath & Beyond.
“Orange County is a great place to launch” At Home’s California businesses, Bird says. “You may have spent a lot of money (buying) your home. We help you decorate it affordably.”
Hidden brand
Bird’s resume includes executive stints at opposite ends of the value spectrum: Nike, sports gear’s premium line, and Old Navy, a bargain hunter’s favorite.
He says that work greatly helped him build at At Home into a corporate persona that attempts to juggle the tricky quality-at-a-value priceline.
“It’s not so much building a brand, it’s having a clear understanding of what brands are,” he says.
So less than a third of an At Home store is stocked with brand-name merchandise. Much of the rest sports At Home’s modest baby-blue, home-shaped icon.
That low-level branding works in a style-focused business like home furnishings because, Bird says, “it’s not the label, it’s the look.”
Pulling it off is not easy. At Home employs numerous tactics to keep its prices at or below its competition. That includes its choice of store locations.
You won’t find an At Home at “Main and Main” as Bird calls the buzz-worthy, top-shelf shopping plazas. Rather stores are located in cheaper, off-the-main-path community retail centers like the one in Lake Forest, which is also home to Walmart and Target — in a long-vacant spot formerly claimed by Sports Chalet and a furniture store.
Western roots
Bird isn’t just talking up the Southern California market because he’s making a big corporate bet on it.
He’s got some roots here.
He grew up around Boston with his mother. His dad was an educator at UC Irvine. That meant trips to SoCal, including Bird’s stint training with the nationally-renowned Nadadores swim team from Mission Viejo.
More recently, Bird’s work at Nike involved overseeing its non-Nike brands including the Orange County-bred surf retailer Hurley. Bird owns a second home in Carlsbad, and one of his six daughters lives in Newport Beach.
Bird notes that California has “rather unique business requirements” that took time to work into At Home’s business plans. So the company slowly came West “to make sure our business model works.”
And now he’s ready to test the thesis in what he called a “great economy with fantastic tastes.”
Anti-Amazon
Home furnishing is a rare segment of retailing that isn’t being hammered by online shopping.
Bird explains why succinctly: “These are emotional purchases.”
A huge reason is decorating a home often means color matching — a chore poorly done on a computer or smartphone. Shoppers can bring their paint samples, fabric splotches or other color targets to better find what matches. That’s a key traffic driver At Home has successfully leveraged to date.
Bird believes so much in this “in-person experience” advantage over online competitors that his company only sells in stores. One corporate profile called At Home the “anti-Amazon.”
The stores not only offer a slew of products in various colors — those hues show up in varying stylings — but there’s an almost brain-numbing selection of looks: traditional/homey to more modern to spins appealing to a youthful shopper.
And Bird notes a key customer for At Home: A young woman bound for college, making plans for decorating her dorm room. He estimates this typical shopper, with a decidedly bargain hunter mentality, manages to spend an average $600 buying everything from mattress bedding to what adorns the walls.
This factoid has Bird and I laughing. We’re both fathers of both college-aged girls and boys, and we both know how little young men spend, comparatively, on their room decor: Who knew a California state flag would be a popular wall hanging?
Economic hints
What do home furnishings sales patterns tell us about the economic cycle?
So far, the At Home concept has succeeded — in both good and bad times.
The national economy, collectively, has been recession-free for nearly a decade. But Bird says many submarkets in which At Home operates have suffered downturns — such as how falling energy prices walloped many oil patch communities two years ago.
Part of At Home’s good fortune is simply the nature of home furnishing’s quirks.
“We do well when the economy’s strong,” he says. “But when it’s not good; when you can’t sell or buy a home or concerned about your job; you’re going to stay and decorate the home you have.”
And some of At Home’s resilience is its low-price positioning, according to Bird.
“When Houston or Oklahoma City were experiencing a recession, people traded down to our stores,” Bird says. ”Just like the dollar stores that did well in the recession.”
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