The news that West Elm is opening in the revamped John Lewis Home department in early September is interesting for a number of reasons. As is often the case for US imports, trading in the UK has proved to be far tougher than they anticipated. At first sight, Tottenham Court Road seemed like a good choice for its first location. But was it? The fact that there are many other home brands there should fool no one: history shows that over the years many have not made money.
The reality is that Tottenham Court Road has a totally atypical core footfall. Does it really attract loads of additional customers as THE major home destination in the South East? I suspect that this store has not told the company very much about if and how it would work in more typical suburban locations. Home retailers need significant footage to work and given our massively higher occupancy costs relative to the US, this is a major barrier. Higher costs need much higher sales densities than they are used to.
Supplying product to John Lewis might prove to be a great move for West Elm and for its parent Williams-Sonoma. There is a good fit in terms of target customers. It will be intriguing to see exactly how the range is presented. After all, Home is THE core product category for John Lewis. It needs to ensure that anything branded here augments, not dilutes its own hard won name in the market. For West Elm, this will be a supplier business rather than a retail one. Its future as a stand-alone retailer in the UK will remain uncertain even if it succeeds as a supplier.
** More analysis of UK and US home retailers in the premium content of richardtalksretail. Get in touch for subscription access.