Digging The Dump
Posted on July 24, 2014 by
The off-price retailer continues to expand its brand
By Andrea Lillo
From top: Mattresses are a strong performer for The Dump. The Chicago location offers customers privacy for trying out mattresses. Area rugs take up about 10,000 square feet in Chicago. The business center is when customers can go for help, enjoy coffee or television, or peruse The Dump-themed merchandise, such as mugs and tote bags.
Don't let the name fool you. While The Dump may focus on keeping prices low, its offerings include limited-edition and exclusive items including $12,000 rugs and $8,000 mattresses.
"We feel that luxury shouldn't be for the privileged few," said Rob Pcholinski, regional manager, Atlanta/Chicago/Tempe.
Approaching 30 years in business, The Dump may still be considered a youngster when compared to its parent company, 100-year-old-plus Haynes Furniture. But the off-price retailer has grown up fast, and is about 75-80 percent of the parent company's overall business, said Pcholinski.
First opened in Norfolk, Va., in 1985, The Dump now has 10 locations, including the newest one last year, in Chicago, its largest location at 134,000 square feet (the other Dumps average 100,000 square feet). Originally it opened several stores in one market, but now it only opens one store per market, such as Dallas, Houston and Phoenix, he said. The Philadelphia market, for example, had three stores, but The Dump recently closed its Langhorne location and is in the process of renovating the other two locations -- Oaks and Turnersville. As The Dump recently opened a new, 120,000-square-foot distribution center in the area, the storage areas of both locations are being reallocated as additional selling space. The Oaks store will also have such renovations as kiosks, a new sound system and more.
Besides its product mix--and its name--The Dump also stands out because of when it is open: consumers can only shop there on Fridays, Saturdays and Sundays. That's when 75-80 percent of sales are conducted at a regular retailer anyway, Pcholinski said, and it keeps overhead down. "As the customer learns what we do, they will shop us differently."
While a lot of the product it sells can be found elsewhere, the difference is in "the value and the immediacy," Pcholinski said, as merchandise is being bought at drastically reduced prices and sometimes only one or two of a kind are available. If The Dump buys something at 50 percent off, "we turn that value over to the customer," adds David Horvath, buyer, casegoods, instead of marking it up.
The Dump procures merchandise from a number of sources, including showroom samples, overstocks, one-of-a-kinds, factory sell-outs and design prototypes, including furniture introductions from such markets as High Point Market. This strategy certainly doesn't hurt the company, as 100 pieces of furniture can be sold off on the floor on any given day, Pcholinski said, depending on the buy and what's being sold. Overall, the average ticket is $1,300-1,400.
On a Chicago store visit earlier this year, Pcholinski pointed out a $1,999 Craftmaster sofa that wouldn't be "touched" for less than $2,500 elsewhere, he said. Randi Strelitz, executive vice president, loved a leather bag from Moore & Giles, which led to an exclusive sofa line.
"We only deal with 5-10 percent of the top of leather," Pcholinski said. Other furniture vendors include Natuzzi, Jonathan Louis and, its "meat and potatoes," USA Premium.
Its short open-to-the-public schedule allows it to easily rearrange the store if need be. "We have no problem moving large quadrants of furniture," Pcholinski said. Recently, it emptied out 5,000 square feet of space up front in the Chicago location to offer Alan White furniture, for example.
Its two best-performing categories, however, are mattresses and area rugs. In established Dumps, the mattress category is about 20-25 percent of the business, while rugs can be 12-15 percent, he said.
The mattress category has really changed, Pcholinski said. Before, it was a commodity product, "now it's about quality of sleep, quality of life." While it "certainly" has promotional mattresses, the majority of The Dump's line retails at $1,500 and up, he said. "People used to spend $5,000-6,000 on their bed and $999 on their mattress. Now they spend $7,000-8,000 on the mattress and $3,000 on their bedroom furniture."
In the Chicago store, rugs are in a space of about 10,000 square feet, and what's not hanging lies flat in piles on raised platforms, which makes it easier for customers to flip through, Pcholinski said.
The Dump used to have mostly machine-made rugs because of the lower price points, but now it has seen its business on the handknotted side pick up, Pcholinski said. On the high-end, with the exception of Atlanta because of the rug market there, "no one competes with us" in rugs. Key price points for an 8-by-10 or 9-by-12 handknotted rug is around $5,000-7,000. The Dump is making higher-quality rugs accessible to young couples, he added. However, "we're not everything to everyone. If you buy a rug and want a matching runner, we may not have that."
Other areas of the store contain motion furniture, dining room sets and home office and children's furniture, as well as lifestyle vignettes.
The Dump strives to make the shopping experience as welcoming and easy as possible. Similar to its newer stores, the Chicago store has a business center in the middle where customers can get help with orders, as well as enjoy some coffee or watch TV. To take orders, associates have mini pads -- The Dump has been without registers for 10 years.
In addition, the Chicago store has a $60,000 Bose sound system installed. "It's part of the experience; that's what E.J. [Strelitz, the president and CEO] wants." The Chicago location also has The Dump's largest distribution center, at 215,000 square feet (other Dump distribution centers average 125,000 square feet).
The retailer also owns most of its real estate (though currently not the Chicago store). "It gives us a lot of flexibility," Pcholinski said. The chain plans on expanding into new markets; such possibilities include Florida, Denver, Austin, Las Vegas and Southern California.
Earlier this year, The Dump started to sell some area rugs online, and more recently, furniture from Old Hickory Tannery. But "that's probably as deep as we'll go."