In the world created by Corte Madera’s upscale furniture chain RH, “There are those with taste and no scale, and those with scale and no taste.”
It’s in this rarefied air that the company formerly known as Restoration Hardware has had to street 440 of its staff at both the corporate and retail levels, including 58 in Corte Madera. The announcement was made in a letter from CEO Gary Friedman to shareholders that accompanied the company’s 2022 year-end financials. The company’s revenues fell from $3.7 billion in 2021 to $3.5 in 2022.
The job cuts come at a time when RH is moving beyond the business of selling home furnishings on its way to being a lifestyle purveyor. While it still has plenty to offer the homeowner looking for large luxury couches, it is growing the company by creating resorts and hotels with the RH style at the center.
Last September RH announced it has purchased land in Napa for a new resort. The company now also has a yacht and plane rentals for those wishing to travel and vacation in style. RH is also adding stores that are grander in scale and make statements about not only what is being sold but also who is buying. These galleries are part of the RH branding strategy.
RH is also going international as the company adds locations in Germany, Spain and the UK. Future RH locations are also slated for France, Italy and Australia.
Long known as Restoration Hardware, the company has gone from selling drawer pulls for the DIY crowd to selling custom furniture available in a range of fabrics and sizes. It also has different lines of business that include RHContemporary, RHModern.com, RHBabyandChild.com, RHTEEN.com and Waterworks.com.
To feed the growth it desires, the retailer raised $2.5 billion in long-term debt “to take advantage of the opportunities that may present themselves in times of uncertainty and dislocation.”
At the same time, RH is reducing inventories, a traditional move in times of instability.
While RH seeks to sell its goods and services to the well-to-do, it has to swim in the same economy as other businesses. And thus, it joins Disney, Whole Foods and Amazon in cutting staff.
And so, reductions at RH turned in to this. There is poetry, there is spin, and then there is the goodbye and explanation below:
“Times like these also require us to have the discipline to say ‘no’ to the things that are nice to do in order to focus our time and resources on what is truly important,” the letter reads. “That includes making the difficult decision to graciously say goodbye to team members whose roles are no longer essential in our new view of the future, enabling us to work in a more integrated and collaborative fashion, on fewer more important priorities. Please know we’ve treated everyone with respect and dignity and appreciate the contributions all have made to our cause. Approximately 440 roles were eliminated as part of our organizational redesign, and we expect to achieve cost savings of approximately $50 million annually, inclusive of associated benefits and other cost savings.”
By all accounts, Friedman’s salary of $4.5 million remains safe.
RH has more than 6,000 employees, with almost 2,500 of those at the retail level.
San Rafael Farmers Market is back
The downtown farmers market returned on June 1 after a coronavirus-induced hiatus. It runs through the end of August every Thursday night.
The market disappeared in 2020 with COVID-19. It came back in 2021, but was relocated to C Street, Sales dropped and the market found that when school was back in session, attendance dropped as well.
This year, the booths are back on Fourth Street between A Street and Lootens Place. The market mix will include food vendors, farmers and ranchers as well as arts and crafts. Kids activities and entertainers will also be included.
Your Marin Moment
Sausalito trattoria Poggio has a star turn in Apple TV’s “The Last Thing He Told Me,” a mystery based on the book of the same name by Laura Dave. The show debuted in mid-April.
While the restaurant itself doesn’t appear in the show, one of the show’s characters deems Poggio her favorite restaurant and star Jennifer Garner attempts to create her favorite dish at home.
The show spent roughly a month filming in the by-the-bay city and a houseboat on Liberty Dock served as the TV home for Garner, her husband and his daughter. The husband disappears and Garner and her step-daughter try to find out why.
In real life Garner ate at Poggio a number of times while filming the limited series. New episodes drop on Fridays.
Bill Meagher is a contributing editor at NorthBay biz where he does this column as well as features. He is also a senior reporter for The Deal, a Manhattan-based digital financial news outlet where he covers small cap equity, SPACs, the SEC and does deep dive stories.
