Shops in front of the Williams Sonoma store in The Mall at the Short Hills Shopping Center in Short Hills, New Jersey.
Gabby Jones | Bloomberg | Getty Images
As soon as the big holiday parties return, the wave of party hosts is washing away the champagne glasses, flexing new skills like making bread and showing the recipes they learned during the epidemic.
For Williams-Sonoma And other retailers, that has the opportunity to sell platters, kitchen appliances and more – and push people to put those items on their wish list.
Williams-Sono, in particular, has been in tears since last year as orders to stay at home inspired many Americans to take cooking and baking as a hobby and buy new furniture and decorations. Along with its flagship banner, the parent company owns other brands such as Pottery Barn and West Elm.
The company’s share price has doubled since January. The stock hit a 52-week high of $ 223.32 on Monday, but recently traded at around $ 210 on Wednesday, giving it a market cap of about .6 15.6 billion. However, home retailers say Americans still have a strong appetite for cooking, entertaining and building homes. Those trends, it is hoped, will give it a chance to last until the holidays are over.
In the coming years, Williams-Sonoma expects its annual revenue to grow at a mid-to-high single digit pace. It expects to reach 10 billion in revenue by 2024, as it benefits from its in-house design and investment in digital. Strong housing cycles such as macro trends will provide additional support.
This year, growth will be even stronger. On Thursday, the retailer raised its fiscal 2021 outlook, forecasting revenue to grow 22% to 23% over the previous year.
Ryan Ross, president of the brand at Williams Sonoma, said sales in recent weeks show Americans are planning for a splendid Thanksgiving and big holiday parties.
Stores are buying larger tablecloths, more flatware and larger sets of wine glasses than they did a year ago, he said. Larger turkeys are selling faster than smaller ones and food orders have also increased in size as people get more ready meals or side dishes to serve. Also, he said, as people become more confident in the kitchen, they are upgrading their equipment, from expensive knife blocks to fancy bakery.
“When the world is open, people still love to cook,” he said in an interview. “Once they know how to cook, they love to cook, and they want to impress their friends with their cooking.”
“People are looking forward to seeing family and friends again,” said Laura Alber, CEO of Williams-Sono.
“Last year, the holidays were a forgotten year, a lot,” she said in an interview with CNBC on Friday. Jim Kramer In “Crazy money. “” Do you have a turkey for two? It was a bit depressing weather. This year, people are dying to return to one place and celebrate and decorate their homes and give gifts and all the great things we didn’t get to do last year. “
Cooking has become a way for people to relax and relax, Ross said.
“It will be released,” he said. “There’s a sense of calm and passion for cooking that when things are open and people are traveling, the appreciation for food and the transparency of what’s in your food won’t change.”
Christina Fernandez, a senior research analyst at Telesy Advisory Group, said the company has a special place to sell furniture. Many Americans are still decorating large homes or other homes that they bought during the epidemic.
“When people move, they usually present houses in pieces,” she said. “They will go to one room. They will do the kitchen and then say ‘I have a good kitchen, let me do another room.’
He raised the price target for Williams-Sonoma after it reported earnings from $ 220 to $ 250 last week, up nearly 19% from where it is currently trading. The firm evaluates the company well.
Fernandez said the company benefited from the high demand for household goods. It has been able to pull back in the promotion.
Going forward, the flagship brand will face tough comparisons and could hurt next year if consumers trade in low-cost furniture and cookware due to inflation or other spending preferences, she said. Its furniture line, Williams Sonoma Home, has higher price points than Pottery Barn and West Elm.
In the last quarter, its furniture-focused brands saw the fastest growth. West Elm’s financial third-quarter same-store sales rose 22.5% year-on-year, while Pottery Barn Kids and Teenagers grew 16.9% and Pottery Barn 15.9%. In-store sales at Williams Sono opened at least 12 months ago and its e-commerce business grew 7.6% year-over-year in the same period. But that was at the top of the 30.4% jump last year.
All in all, the parent company took an equal-store sales profit of about 17% for the three-month period, topping Wall Street estimates.
Fernandez expects Williams Sonoma’s flagship brand to increase sales by expanding its personal label products and specialty merchandise, such as Seasons from meat rubs and grilling company Trigger or premium cookware approved by celebrity chefs like Bobby Flay.
Earlier this month, Williams Sonoma launched a membership program called Williams Sonoma Reserve to keep customers busy. Members receive free shipping for many items, access to the recipe app and programs with virtual cooking classes and celebrity chefs like Ina Gartens. Membership service costs 99 for one year. Customers can also subscribe to the Recipes app, which costs $ 39.99 and includes videos on how.
Cookware is on display at the Willams-Sonoma Retail Store in Corte Madera, California.
David Paul Morris | Bloomberg | Getty Images
Retailers selling home furnishings will have more ways to cash in on the holidays, said Joe Derochowski, NPD Group’s home industry consultant. The initial wave will come from consumers living for new coffeemakers, cookie cutters and more as they prepare for the arrival of guests.
Additional sales may come when people request these items as gifts or buy them for others. And at parties, people may find attractive gadgets or kitchen appliances after hearing friends or family get angry about it – and then decide to buy it, he said.
Sales of hosting-related items such as glassware, plates and leftover food storage tend to pop up in early December, he said. However, retailers will have to find ways to keep sales going as consumers spend more time traveling, eating and other activities outside the home next year.
According to the NPD projection, home industry spending by unit is expected to decrease by 5% in 2022 as compared to 2021. It will still be about 14% higher than the 2019 level, though. The NPD category includes personal care products such as home appliances, kitchen electronics, appliances for the home environment such as vacuum and air purifiers and electric toothbrushes. This does not include furniture or home decor.
Derochowski of the NPD said facility-related items could be a potential growth area. He said people can buy multi-cookers like automatic espresso machines, robotic vacuum or air fryers, slow cookers and toaster ovens because they are busy again.
“The level of convenience is dialed into our lives,” he said.
While many people are entertained during this holiday season, they can also give homemade cookies and jams as extra gifts. Chris Malkowski, CEO of Home Solutions for the Newell brand, said he expects to see sales of RubberMade’s Brilliant food storage line and Ball’s Mason jar pop.
Other retailers have also pointed to the paint-up desire of Americans to host family and friends during the holiday season and beyond. Loves And Home Depot Has expanded its selection of home decor and featured it on websites and advertisements.
Consumer electronics retailers too Great buy He said that he wanted to have more in the household goods. Earlier this month, it acquired Yardbird, a direct-to-consumer brand that sells outdoor furniture, such as patio sets, fire tables and wicker chairs.
These retailers are competing in a very fragmented market. Williams-Sonoma was able to capitalize when one of its rivals, luxury kitchen retailer Sur La Table, filed for bankruptcy during the epidemic and closed several of its stores.
Real estate trends have also worked for retailers – especially as many millennia have become homeowners. Alber said the hybrid work routine also boosts the company’s sales.
“If you’re at home one day or even half a week, you’re working short hours and coming home and working early in the morning, you’ll care more about what your home looks like,” she said. In “Crazy money. “
Newell brandsThe company, which owns Calfalon, Ball and RubberMade, said consumers are attracted to more high-end kitchen supplies. Its products are sold in shops Bed bath and beyond, Walmart, Costco And Williams Sonoma.
“What I’ve just noticed on board is the gravitational pull towards the mid-price point and the premium price point or high-quality features products,” said Chris Malkowski, CEO of the home solutions company.
She said that even in the case of food storage, many consumers buy elegant looking glass containers from rubbermade or food savers rather than high-tech vacuum sealers.
And she said she expects ball mason jars and other storage containers to pop up for sale this holiday season. Many of the same customers who buy cookware miss out on making rubber jams, cookies or other homemade food gifts for family and friends during the epidemic.
“I really like giving gifts to those who eat,” she said.
She hopes that the launch of more sophisticated, innovative kitchenware in 2022 will boost sales. Also, she said, inflation could actually motivate many Americans to prepare food to save money.
Food and furniture are two areas where Williams Sonoma’s flagship brand is expected to expand, Ross said. Its stores and websites carry many shelf-stable food items ranging from cake mixes to pasta sauces with the Williams Sonoma brand. It also sends ready-made food to people’s doorsteps. And it carries government products, sometimes with well-recognized brands such as the tequila company Casamigos.
Consumers can expect to see a wider variety of foods in the coming year, such as more international flavors and cocktail mixes, Ross said.
The flagship brand has also sharpened the beauty of its furniture brand, Williams Sonoma Home, to become “more sophisticated and curated” and “an online luxury furniture destination,” Ross said.
He said it is a natural fit because people are ready to show their home on vacation and outside.
“If you are entertaining, you need a meeting room. If you are entertaining, you need a guest room,” he said. “If you’re entertaining, you need a dining table. If you’re cooking, you need your kitchen outfit – so barstool, you need lights, you need cookware, you need a tabletop that goes over the dining table. So really our perspective. It’s about cooking and entertaining. “