How Lumber Liquidators Reached a Growth Landmark Despite the Economy
Lumber Liquidators has reached a most enviable major milestone. The retailer just opened its 300th store. The opening took place in Las Vegas and was noteworthy for more than just its impressive and clean numerical designation.
This location features the company’s new ‘store of the future” prototype. The store of the future design includes an expanded showroom of approximately 1,600 square feet which displays a greater variety of flooring options and accessories than do the company’s traditional locations.
Thus far Lumber Liquidators has opened 12 new locations this year. By year’s end the company expects that total to reach about 30 new stores with the possibility of climbing to as high as 35. All new stores will feature the new advanced layout.
While reaching the 300 store milestone is impressive, at least equally noteworthy is the growth the company has consistently demonstrated despite the two recent factors which have virtually crippled most companies across the entire industry. First the subprime crisis sent building and new housing rates into a tailspin. Then the recession pretty much suffocated most other avenues of financial growth throughout the nation.
Despite these severe economic strains, Lumber Liquidators has grown from 80 locations at the end of 2006 to its current 300 position as is listed in Chain Store Guide’s database of Home Center Operators & Hardware Chains. Perhaps more impressive, we see that through this economically challenged period, during the company’s weakest year- recession-torn 2008, the company still grew by 19 locations.
The year before, Lumber Liquidators had grown by 51 stores, a number which seems all the more impressive within the context that many companies in our industry were by then consolidating operations, as they succumbed to the forces of the subprime crisis. At the end of 2008, the company was operating 150 locations. That number has been doubled in just over four years.
Lumber Liquidators will celebrate another milestone next year, its 20th birthday. Despite its relative youth and its humble beginnings, the company began operations by selling surplus building materials at heavily discounted prices out of a warehouse in West Roxbury, Mass, Lumber Liquidators attributes much of its success to its sophisticated, proprietary, direct sourcing system of product from mills globally. This company-created model of direct sourcing proved to be a bold step in sharply reducing pricing by essentially eliminating middlemen from its supply chain.
Lumber Liquidators purchases majorities of product produced by this worldwide selection of mills. This gives the company significant control over product selection, variety and price. This results in a comprehensive offering of flooring (now over 340 varieties) and related products, accompanied by hard-earned reputation for prices designed to beat the competition. Obviously, as witnessed by its continuous and consistent growth, this formula for success works under the severest of conditions.