Wayfair's Big Bet on Bricks and Mortar

Summary

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.