Bob’s Furniture debuts on the New York Stock Exchange as the company takes its next step as a public retailer. Bill Barton, CEO of Bob’s Furniture, joins J.D. Durkin to discuss the IPO, consumer demand trends, and the company’s long-term national expansion plans.
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J.D.: Please welcome to the show. Now a very, and I do mean very, special guest. The great Bill Barton, CEO of Bob's Furniture. What a day. IPO day here at the Big Board. Congratulations. Great to have you.
Bill: It's great being here. J.D. thanks for having me.
J.D.: Thanks for the digs here. We're ready to rock and roll. These have been all over the trading floor today. Thanks a lot for joining us. First and foremost, what does this mean for you personally this day for such a great legacy brand to be down here at the New York Times?
Bill: The company's been around 35 years and a team that's been working for so long, you're really helping people furnish their homes with great stylish furniture everyday low prices, never taking their eye off that ball, but finding ourselves in a place where we were ready to become a public company. It's a big day for everyone on the Bob's team.
J.D.: Bill, how closely do you have to kind of match the general macroeconomic conditions when you and your team make a decision like this? We've seen a lot of activity in the IPO market. You're still on a broader backdrop of consumer uncertainty.
Bill: Yeah,absolutely. But look in our in our case we thrive in all economic conditions. You know, we've been around 35 years. We've seen how our business performs and down cycles and up cycles and being an everyday low priced leader, you know, our sales are much more consistent over the years. we're a little less impacted by macro.
The other thing is a lot of furnitures bought at life milestones, like the young person starting their first apartment, or the young couple setting up their home. That still happens regardless of macro. But even in those times, we like to say value is always in vogue So the Bob's way wins in all conditions. So here we are today having our IPO.
J.D.: Are there correlations between headwinds and pressure points on the broader housing market. And therefore the availability maybe of a lot of those would be consumers to say, now is the time to make that ultimate furniture purchase.
Bill: Well, we're not correlated directly with housing, but we would certainly benefit if there was a tailwind. But over the last three years, you know, furniture has kind of been in a slump, but we've been growing and taking market share. We've been staying on track with 10% new units every year. So people are still buying furniture. But if the housing market turns around, it would be a tailwind would be very helpful to us.
J.D.: One of the stories I've been tracking closely the last year, this idea of value shopping, right. We hear from companies like Walmart. They say we are seeing more higher income, six figure Americans, their shopping for their essentials at Walmart, more than the company has ever seen before. And I wonder if Bob stands to benefit from something comparably. Are you seeing higher income Americans say, hey, I've got lots of furniture options, but Bob's is the brand I'm gravitating toward.
Bill: We actually are J.D. In fact, that's the one cohort that's been growing the fastest for us. So 27% of our of our consumers have household income over 150,000. And that's up 3% in the last two years. It's a fastest growing cohort. In fact, we said there's a trade in effect going on at Bobs. They're finding us. They're loving what they find. But we sell, of course, to all income demos. That is the fastest growing demographic for us is the affluent households.
J.D.: That's really that's a fascinating storyline to continue to track. And thank you for that. If I'm not mistaken, right now you're in 26 states.
Bill: Yes.
J.D.: I went through your S-1 filing. You hope to grow to about 500 stores by the year 2035. To some degree. Show us what that roadmap looks like.
Bill: Absolutely.Well, today we're in five regions across the country. Our original two here in New York and New England. We grew into the Midwest and actually all the way up to California in 2018. In fact, a little tidbit for you, the state that has the most Bob's stores is California. So we've demonstrated portability of our model across the country.
Now, if the 300 stores are going to be opening in the next ten years, about 100 will be an infill in those markets So we're still opening new stores here. We opened one on Long Island City, just recently. About 100 will be in the southeast. We've already opened in North Carolina this year. We're moving south, so 100 stores will come from there. The last 100 stores will be in the Texas, Rocky Mountain, Pacific Northwest. So about a third, a third, a third across those regions.
J.D.: All right. I live very close to Long Island City and western Queens. I'll make sure I pay the new location a visit. Bill Barton, CEOof Bobs Furniture, congratulations on a great day down here at the New York Stock Exchange. And thanks for being on the show.
Bill: Thanks for seeing me, J.D.