HomeGoods to Close its E-Commerce Store
HomeGoods is shutting down its online store. The discount home decor chain, which is owned by TJX Companies, sent an email to customers Wednesday announcing that it would stop offering online shopping after Oct. 21. TJX reported in August that net sales from e-commerce were less than 2 percent of total sales in its most recent quarter. HomeGoods launched its long-awaited e-commerce site in September 2021. Part of the company's initial hesitation came from its business model — offering low prices and the bargain-hunting thrill that comes with in-store shopping.
Total Retail's Take: Counter to what many retailers and brands are doing — investing resources to grow their digital businesses — HomeGoods its shifting the focus back to its core channel, brick-and-mortar retail. The home decor retailer was decidedly late to the online shopping game, launching e-commerce functionality on its website just two years ago. The decision proved to be a temporary one, as it found that the treasure hunt shopping experience at the heart of HomeGoods' business model wasn't easily replicated online. And a reliance on physical retail has yielded strong results for TJX. The company's second quarter net sales were $12.8 billion, an 8 percent increase compared to the same quarter last year. Furthermore, TJX plans to open about 125 new stores in fiscal 2024. Lastly, rising logistics costs, particularly in HomeGoods' product categories, likely contributed to the company's decision to eliminate e-commerce and go back to in-store only. If nothing else, it gives industry analysts an interesting test case to follow as we continually preach about the merits of omnichannel retail.
