Williams-Sonoma Profit Down 90%
Williams-Sonoma, which also operates Pottery Barn and the West Elm chains, said Tuesday that quarterly profits fell 90 percent, reports the New York Times. They don't expect to see a boost again until the holiday season. Maybe by then people can start justifying that $500 Le Creuset Dutch oven.
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20 Comments:
This is not good news for the bastion of all things kitchen and beyond. I love their stores, but the prices on way too many things are totally out of line with today's economy. Unfortunately, if they too are to survive these ruggedly challenging times, they must adapt quickly. Charging $45.00 for a cookbook that I can get online for $22.99 delivered to my door is a prime example. Perhaps they might investigate realistic pricing on their core items, as well as shaking down some of their suppliers for additional retail support. Otherwise, I fear that this shrine to glamourous kitchen excess might soon fade away.
Boscompb at 3:19PM on 03/25/09
They are horribly over priced I never shop there. That store is for suckers.
simon at 3:23PM on 03/25/09
I recently had a hard time spending a $50 gift card there....the things I wanted/needed would still have required a signifigant amount of my own cash, and the things I could afford with the card were mostly gadgets.
I don't necessarily think the items are all over-priced, but this might be the time that they need to diversify their offerings a wee bit. With proper in-store marketing, they should be able to differentiate the two price points well enough not to dilute their image. Just because they are fairly priced does not mean that there are enough people right now who can justify that kind of expenditure.
Show me something I can afford right now, and when I again have the money for your top-of-the-line stuff, I will be back!
Cary at 3:32PM on 03/25/09
WS is a great place to window shop but I agree with the other posters that it is way overpriced. I'll stick to Bed Bath & Beyond for all my kitchenware needs with my 20% off coupon in hand.
atxgirl at 3:33PM on 03/25/09
I do think that some items are way overpriced, and I do mostly shop the sales there, but I will shrivel up and DIE if that place goes under!!!
cafire at 3:42PM on 03/25/09
I'm a WS window shopper too....there are too many other places to get the same items alot cheaper.
My sister & I were gasping over one of their new items....Sloppy Joe starter....$12.95 for a jar that was equal to about 2 cans of the same stuff in the grocery store. We read the ingredients...almost identical to the grocery store stuff...including the high fructose corn syrup. I make it from scratch...but I couldn't imagine anyone buying the stuff from WS.
Love their web site though....lots of great recipes!
mepolo at 4:02PM on 03/25/09
I am surprised by all the "overpriced" comments here -- they're upmarket and don't have a lot that is not in a higher price range. Overpriced means charged significantly more than everyone else for the same items. And to the person who is complaining about them selling books for list price, the "I can just go buy it cheaper online" sentiment has also killed a lot of local bookstores, like San Francisco's Stacey's.
furlinedteacup at 4:27PM on 03/25/09
I want to stand up for Williams-Sonoma. I'm sorry they're having a hard time and hope things pick up for them quickly.
First, Chuck Williams is an amazing guy, a real hero for home cooks. Much of today's kitchen/home retailing world owes a hat-tip to Williams-Sonoma.
Also, keep in mind Williams-Sonoma sells items premium items. It might be the expectations of some shoppers, rather than Williams-Sonoma's prices, that are "totally out of line."
I appreciate them for doing what they do well: offering a carefully culled line of premium cooks tools. The people who work in their stores usually love cooking and are well trained in how the products can be used.
Their very high-quality dish towels and table runners are my hands-down favorites (and if you insist on a deal, watch the back of the store: they always go on sale at the end of the season).
I've been watching W-S carefully since the recession to see how they would respond to the changes in the economy. For those hunting for lower price points, it looks to me like they are starting to offer less expensive items, more plastic tools.
gochrisgo at 4:54PM on 03/25/09
The discount stores have pretty good Chinese knockoffs of those Le Creuset pots. Part of W-S's woes may simply be that there's more competition, and home cooks are getting wise to what's available now at discount stores, restaurant supply stores, on-line specialty appliance retailers, etc.
Lorenzo at 5:27PM on 03/25/09
Just because it looks like a Le creuset does not mean it acts like one. The enamel chips easily and the heat distribution isn't as good. Quality items are investments. You can buy cheap pans and keep replacing them every year or go out and buy all clad and they'll last a life time -if you take care of them correctly- which I had to learn the hard way!
rockymountainmarta at 5:42PM on 03/25/09
So it's essentially like an upscale restaurant....you're paying for atmosphere? I don't buy cheap kitchen tools, because they are like everything else, you get what you pay for....but I do shop around price wise...simply because in this economy we can't afford to pay an extra $10 or $15 for something because of the atmosphere I've purchased it in. The closest WS store is about 20 miles from me, so I've only been in there a couple of times....guess that's why I don't 'get' it. I suppose though, that they may have to start adapting to survive?
mepolo at 8:04PM on 03/25/09
@mepolo and all: that's kind of what I was trying to say earlier: I don't think they are overpriced, but I think they may need to do a little repositioning during this economy, as the customer base that values their high quality products and can still afford them is temporarily smaller.
I expect to see a number of their stores closing, but a bump up in their catalog and online marketing. When the economy improves, the stores will be back!
Cary at 10:49AM on 03/26/09
I love this company and think they do offer high quality products. However, after some comparisons I do think they are priced on the high end for a lot of their products. I understand the clientele they are seeking, which is why I don't frequent the store as often as I would like($$$), but in order to survive they will have to make adjustments, just like the consumers are.
iwanttobeachef at 12:06PM on 03/26/09
I definitely agree it's more of a window-shopping store. It's where I go when I want ideas of what to buy at cheaper stores or online! I'll definitely be bummed if they go under.
VerySmallAnna at 2:11PM on 03/26/09
Also, I have a co-worker who used to be employed by Williams-Sonoma. She told me that the employee discounts when purchasing merchandise were unbelievable(40%). Is this any indication of the kind of markups we as consumers are getting?
iwanttobeachef at 2:13PM on 03/26/09
Employee discounts on merchandise ARE 40%, but they only get a 20% discount on electronics/appliances. I have an ex-bf who did some seasonal work for them because his SIL was a manager - and that year, everyone in my family got WS. They were ecstatic!
nichole at 4:06PM on 03/26/09
It's places like this that will suffer when there is an economic downturn, since they sell stuff that are unnecessary. If I want to buy unnecessary stuff, I look online and price match - why be stupid and pay 20-50% more for the exact same item?
If a business wants to stay in business, it has to sell stuff people want at prices people will buy. They'll just have to change their business model or go the way of some of the other large businesses who weren't able to change with the times.
Cassaendra at 8:33AM on 03/28/09
I was employed at WSC for 8.5 years - I worked at Pottery Barn. While some of you may be aghast at the idea of a 40% employee discount, that's normal for any retail store - But department stores can be anywhere from 20-30%. Some stores even offer a discount on gift certificates. (Personally, I feel like that's giving money away.) WSC is pretty strict on what you buy, who you're buying things for, etc....And seasonal employees do not have the same discount policy as regular sales associates. (No catalog purchases - you can only shop at the one store were you work - no shopping at the other Pottery Barn across town or between concepts, etc.)
mollymorris at 8:45PM on 03/29/09
No big loss! We had been Williams & Sonoma customers for years, but had a bad experience with them this past holiday season. We ordered their cannelés, which were highly rated at the time. When they arrived we found them to be burnt and inedible. After writing to let them know these were not fit for consumption, I received an email from them indicating that I was wrong and that I didn’t know what to expect regarding cannelés. I find this surprising since I enjoyed them while on business trips to France. I was not the only person to complain … there were at least six other people out of sixteen respondents who had similar comments. Companies that don’t listen to their customers deserve to go out of business
gmack at 8:56PM on 04/12/09
I am a Williams-Sonoma employee. I would first like to say don't comment on anything about a store until you have consistently witnessed any kind of atmosphere(good or bad). second, gmack, youre an idiot. We are an american-made store. No youre canneles will not taste like canneles in France that were invented in France and have been made the same way for 100 years by one family. And yes, sometimes people are abrasive when it comes to handling customers, but when it's Christmas, put your selfish needs aside. We deal with millions of people during holiday season and your lucky someone didnt go to your house and punch you. That's just the way some people respond under stress. Sorry. Yes 20% of things are over priced. But if you actually cook(and you know what youre doing. Tuna helper doesnt count) then you should know what kind of quality you need to make dishes. No WS is not selling more plastic items. That would be stupid. We are known for our hard to find utensils and quality vendors. Oh yea, that reminds me, we do not make Le Crueset, Kitchenaid, Waring, Breville, or All-Clad. We just sell it. So stop returning 5 year old broken machines that we can not handle. Go straight to the manufactuer.
jasbo17 at 11:22PM on 06/21/09