Canadian Lloyd Ross came to the United States a seasoned businessman, a consultant aiding companies in product liquidation. He was good at his job. So good, in fact, that he found himself on the flip side of the liquidation process: he became the buyer.
Ross began selling his accumulated treasures out of his own garage in north Dallas. This proved successful, so he took out a full-page ad in a local newspaper and “sold everything to the walls,” says his longtime associate, Karen Goodman. Then, in 1972, Ross moved to Dallas' Warehouse District where he rented an office with a small storage room attached. “He literally cut open box tops and threw items on the table,” Goodman explains.
Customer response was enormous. As a result, police had to be called to regulate the crowds. Ross sold everything in a matter of days. Lesson learned? Buy a bunch of unique items, open the doors, sell it all, and close the doors to restock. This, in a nutshell, is how the Tuesday Morning concept was born.
Movin' on up
Today, the Dallas-based retailer operates 469 stores in 42 states from Connecticut to California. To date, Texas and California have the heaviest concentrations. But Tuesday Morning is now reaching into the Northeast and Pacific Northwest. Global expansion is on the back burner at the moment. “We're approaching 500 stores,” says Goodman, vice president of real estate. “A lot of companies hit this threshold and think ‘Where else can we go?’ I don't think it would be out of the realm of consideration, but we don't have plans right now of going international.”
However, Tuesday Morning is expanding its superstore format from coast to coast. All stores are company-owned. The possibility of franchising has never been discussed and “maybe never will,” says Goodman. “Next year we're targeting about 10% growth spread evenly into the four fiscal quarters,” she says. “This is what we look at every year.”
Getting the goods
Tuesday Morning believes its distinct concept is responsible for fueling this ongoing success. “People typically think close-out retailer and they think low-end,” Goodman says. “Not only do we discount high-end merchandise, we get things other retailers don't get and then sell them on an event basis.”
Thanks to the expertise of its buying team, Tuesday Morning is able to negotiate fantastic opportunities. One strategy includes having buyers offer a take it or leave it price on one-of-a-kind samples at various shows or marts. Another tactic involves taking advantage of slow production times in Europe and the Far East. When a company would otherwise close its factory doors temporarily, Tuesday Morning steps in and offers to buy the production time for a specified period. The result? Workers are happy, the factory continues operating, and both it and Tuesday Morning receive a healthy margin from the sale of the goods.
So what are these high-end name brands that the company makes a fuss over? Lladro (china), Hartmann (luggage), Daum (crystal), Lalique, Limoges, Madame Alexander — and that's just the beginning. Not bad for a closeout operation. “We don't really have a competitor,” Goodman says. “No one else sells the products we sell for the same pricepoint.” Although prices are usually in the mid-point range, items range anywhere from $5 (stationery) to more than $1,000 (Tiffany lamp). Simply put, Tuesday Morning is a high-end giftware retailer selling everything from bedding and leaded crystal to dolls and Christmas decorations.
Sites and sensibilities
To reach its target consumer — generally white-collar, professional females, single or married, 25 and above — Tuesday Morning stores are commonly found in grocery-anchored centers. These locations serve as an added convenience to shoppers. Tuesday Morning also builds stores in neighborhood centers, strip centers or on freestanding pads. “We still do warehouse stores as well,” Goodman says. “We like them and they do well for us.”
Due to its sporadic open/close schedule, the retailer doesn't move into mall locations. In 2002, Tuesday Morning is scheduled to have its doors open 265 days out of the year. During January and July, slow months for retailers, the shops are closed. This gives them time to restock merchandise and change their look for upcoming seasons. “Other than that, we do short close-downs anywhere from three to five days to fill the shelves and aisles with more products,” says Goodman.
As far as design, each store is different. Though the company tries to adhere to its 8,000-sq.-ft. to 10,000-sq.-ft. footprint, stores measure anywhere from 4,000 sq. ft. to 32,000 sq. ft. In addition, the retailer's new president, Kathleen Mason, has decided to upgrade Tuesday Morning's appearance. The new look will incorporate gray-speckled flooring, trendy new signage, and galvanized steel fixtures that create a clean, simple, and modern look.
Contact: Karen Goodman, vice president of real estate, Tuesday Morning, 972.387.3562, (F) 972.788.5211 or visit www.tuesdaymorning.com.