Tile Shop hits the marble floor running
Is Tile Shop the fastest-growing specialty building product retailer in the country? Or does it just seem like it?
In the span of a month, Tile Shop locations cropped up in Tulsa, Danbury, San Antonio and Oklahoma City. And since it went public in August 2012, the Minneapolis-based retailer has been expanding aggressively. Twenty stores opened in 2013, debuting in new markets amid a beefed-up corporate infrastructure.
CEO Robert Rucker says earnings will come for the Tile Shop, which swung to a slight profit in the fourth quarter after two years of much bigger losses.
“While we made progress in strengthening The Tile Shop brand and infrastructure this past year, we recognize that we have more work in 2014 and beyond,” said Rucker in a prepared statement. “We continue to firmly believe that as our new stores mature, the company will return to the historical levels of profitability.”
One reason for that optimism, said Tile Shop COO Chris Homeister, is changing consumer tastes. “We feel that the timing within the industry is absolutely right,” he said. “There continues to be a growing acceptance and desire to have hard surface flooring and tile. We’ve been warmly received everywhere, even though we don’t advertise very much. We rely upon word of mouth and social media.”
Joan Storms, senior VP equity research at Wedbush Morgan Securities, believes it’s the fastest-growing retailer of its kind, just ahead of Lumber Liquidators. Publicly traded Tile Shop is aided by a “strong and best-in-industry store model supported by strong sourcing margins, since they source direct,” she said in an email.
The company is planning another 20 new stores in fiscal 2014. And Homeister said they’ll be staffed by designers who know the product: “We feel we can inspire people when we bring them into the store.”