Williams Sonoma 1Q15 Earnings Call Notes

Key initiative in inventory management

“One of our key initiatives is inventory optimization. The West Coast port slowdown has further validated the importance of being in stock. We are focused not only on improving our inventory stock levels to be well positioned for the back half of the year, but also for the long term.”

Stocking has gotten better but still short

“As expected in the first quarter, we lost sales demand and saw higher back order creation as a result of the port disruption. We also incurred incremental shipping and fulfillment related costs. While our inventory flow improved throughout the first quarter we did not see meaningful improvement in our in-stock and available for sale inventory positions until April. And we have seen our sales trends get better as we improved our in-stock positions particularly in the Pottery Barn brand. That said, lingering effects exist on the port slowdown that are continuing to impact our business in the second quarter’

Browse in store shop online

“And we really believe in building that one-on-one connection in our stores and using our stores for that really high touch service. And then of course they go online and they often — they go to the store, they visit the store and then they go online and make a purchase.”

People don’t want to just buy things, they want to know where they’re from

“We also, as you think about the other two initiatives, we realized that customers don’t just want to buy things, they want to know where they are from, they want — people to source product sustainability and West Elm has really embraced this idea and has such a big footprint in the area of consciousness because of all the wonderful things that they are doing.”