Bob's opening more stores
By Clint Engel -- Furniture Today, February 16, 2004
MANCHESTER, Conn. — Bob's Discount Furniture is opening three stores this year and another early next year, continuing an aggressive push into greater Boston and other New England markets.
The retailer opened its 20th store, a 35,000-square-foot showroom in Manchester, N.H., last Thursday — in time for the Presidents Day holiday weekend — pushing north from a core of stores in greater Boston.
Bob's will follow that with a 56,000-square-foot store opening in a new market, South Portland, Maine, on Memorial Day weekend. And on July 4, a 57,000-square-foot store will open in Southington, Conn., replacing the smaller Waterbury store nearby.
Early next year, Bob's plans to open a 35,000-square-foot store in an undisclosed Boston suburb, giving it nine stores in that metro area.
The growth should drive Bob's annual sales run rate to $250 million to $270 million this year, and past the $300 million mark in 2005, said Bob Kaufman, president of the Top 100 chain.
In five years, Bob's has grown from a 14-store, $79 million retailer to a roughly $205 million player with 19 stores at the end of 2003.
Kaufman said business was up about 25% last year. This year, despite winter storms and freezing cold that usually keep consumers away, "I have no complaints," he said. "We're ahead this year already."
Bob's kicked its growth into high gear in 2002, embarking on a $12 million-plus expansion project. The company opened three former HomeLife stores in the Boston suburbs of Saugus and Stoughton, Mass., and Nashua, N.H., doubling its presence in the market and bringing the retailer closer in to the city.
In late December, Bob's opened a 72,000-square-foot store in Worcester, Mass., giving it eight stores in the hotly contested greater Boston market, which includes such midpriced heavy hitters as Jordan's Furniture, Bernie & Phyl's Furniture and the soon-to-enter Ikea.
"We're heavy promoters and there are economies of scale when you expand in an existing market," Kaufman said. "We're certainly using the advertising umbrella that exists effectively."
Some of the newer stores, including the Worcester showroom and the planned Southington store, are former Ames department stores. Those stores have or will include clearance centers.
As with the HomeLife units, they will be renovated to become family-friendly environments offering the promotional to midpriced furniture on which Bob's has built its reputation. Although the retailer keeps "tweaking our formula," Kaufman said, the new stores will have the chain's trademark fishponds and refreshment areas with free cookies, candy, ice cream and now popcorn.
Most key suppliers will be the same, including Klaussner, Serta bedding, Italian leather producer Soft Line and Global in bedroom.
But as it has been from the beginning, Bob Kaufman is the brand. No manufacturers' labels are advertised or played up in the showroom.
The chain is taking that strategy a step further in its current ads, which tout, "No name brand and proud of it."
Kaufman said this goes against conventional wisdom but has served the retailer well. In his community talks, usually at schools, he often asks his audiences to name five furniture manufacturers, and he has never found anyone who can do it.
"If indeed the lack of brand recognition is that blatant, then for me to advertise anybody's brand name seems very counterproductive," he said.
Bob's still spends most of its ad budget on television, and Kaufman remains the key spokesman, inviting viewers to "come on down."
"We are a one-price retailer," he added. "We don't play games with our pricing, and I think people appreciate that low-stress atmosphere."
With the sales growth and new stores, Bob's also is exploring warehouse expansion options. The retailer currently services all its stores from a 367,000-square-foot distribution center and a 50,000-square-foot overflow warehouse in Norwich, Conn.
Kaufman said the company might expand the main facility by 200,000 square feet, but probably not this year. Bob's also is looking at buying or leasing additional space in the meantime.
But you won't hear Kaufman complaining about any challenges caused by the chain's fast growth.
"I feel very fortunate the public has responded so positively (to Bob's)," he said. "They recognize the value we're giving and have rewarded us by allowing us to grow."
