Wayfair's Big Bet on Bricks and Mortar

Wayfair CFO Kate Gulliver gives a tour of the new Atlanta flagship store and explains the financial logic behind the company's push into brick-and-mortar. The supplier-owned inventory model reduces capital risk, while store economics and the online halo effect support a plan to eventually open locations in most major US population centers. - Wayfair opened a 150,000 sq ft flagship store in Atlanta to complement its e-commerce business. - Supplier-owned inventory minimizes Wayfair's cash outlay and improves cash-on-cash returns. - Store performance is evaluated on four-wall economics and the incremental online sales lift generated. - Digital price tags and app integration keep pricing and experience consistent across channels. - In-store shoppers often discover broader product categories like decorative accents, boosting basket size. - Experiential features such as a functioning shower wall create engagement and social media buzz. - Wayfair believes its customer geography aligns with major US population centers, enabling wide store expansion.