With the big retailing flooring chain liquidating, several competing retailers stand to pick up its $900 million in annual revenues.
The news that LL Flooring, the 400-store specialty chain already in bankruptcy, would be shutting down completely and liquidating was not totally unexpected: the company had said if it couldn’t arrange for a new owner or financing that was the likely outcome.
Now, what’s more uncertain is what happens to its almost $1 billion in retail sales, much of it in hard floor coverings. The liquidation sales have already started and the company says they will go for the next 12 weeks with schedules varying by location. So short term it is expected LL will take an outsized portion of the marketplace as shoppers hit their stores looking for bargains. It is often what happens in retail going out of business sales.
Once the process is over, the retailer’s key competitors stand to gain some important market share. The most likely winners will be Home Depot and Lowe’s, the giant DIY and home improvement chains that are major players in the flooring space. Another gainer is expected to be Floor & Décor, the specialty chain with about 245 locations and some $4.3 billion in annual sales, again much of it in hardwood flooring.
The big unknown is how much of that nearly $1 billion in business just disappears. In many previous retail shutdowns, a certain percentage of that company’s business just went away, often a third and sometimes as much as half. This was a factor of one fewer retailer promoting the category and holding sales, events and other traffic-building tools. But also, it just meant one less store for a shopper to drive by on the way home from work or out on a shopping trip and stopping by impulsively.
However LL’s business gets divided up, we’re about to find out.
Editor’s note: At IWF Network News press time a last minute buyer has surfaced to purchase at least some of the LL Flooring stores and assets. More details forthcoming.
