Wayfairrecently announcedthat it will be opening its first brick and mortar store this fall. The company has previously found success with its online business model and never felt the need to have physical stores. At one point, the company was insistent on noteverneeding to open any brick and mortar locations.
Warren Shoulberg, a Forbes contributor,added that this mindsetabout keeping an online business model was changed recently. He said, “At a housewares conference late last year, Wayfair CEO Niraj Shah said publicly — maybe for the first time — that it could eventually open physical stores but that they would serve more as adjuncts to drive online business than as profit centers unto themselves.
Thefirst physical storewill be near Cincinnati and is being called an outlet store. Shoulberg mentioned that the purpose of this store is “to sell off excess inventory, including returns that, according to most people, have been excessive even by online standards.” The store will consist of 20,000 square feet of retail space.
Will Wayfair open more stores in the future? It seems that the company is undecided about that at this point. However, they have realized that thecost of acquiring customers onlineis much more expensive than acquiring them in a physical store, Shoulberg added. As he said, “The cost of getting someone to walk into your store is turning out to be less than the price tag for getting him/her to make a purchase on your site.”