Mission Statement, Vision, & Core Values (2024) of Arhaus, Inc. (ARHS)

An Overview of Arhaus, Inc. (ARHS)

General Summary of Arhaus, Inc. (ARHS)

Arhaus, Inc. is a leading home furnishings retailer that specializes in high-quality, sustainably sourced furniture and home décor. Founded in 1986 by John Reed in Boston, Ohio, the company has grown from a small operation to a prominent name in the home furnishings industry. Arhaus operates a network of Showrooms across the United States, showcasing a diverse assortment of products including furniture, outdoor items, lighting, textiles, and decorative accessories. As of 2024, Arhaus operates a total of 101 Showrooms, which includes 83 traditional Showrooms, 11 design studios, and 7 outlet locations, covering a total square footage of approximately 1,623,000 square feet.

In 2024, Arhaus generated net revenue of $924.1 million, reflecting its strong market presence and customer appeal. The company's commitment to sustainability and unique design has positioned it as a favored choice among consumers seeking quality and eco-friendly home products.

Company's Financial Performance in the Latest Financial Reports

In the nine months ended September 30, 2024, Arhaus reported a net revenue of $924.1 million, a decrease of $19.6 million, or 2.1%, compared to $943.7 million for the same period in 2023. This decline was primarily attributed to the non-recurrence of prior year abnormal backlog deliveries. The gross margin for the same period was $362.5 million, down from $399.2 million in the prior year, resulting in a gross margin percentage of 39.2%, a decrease of 310 basis points.

For the three months ended September 30, 2024, net revenue also decreased by $7.1 million, or 2.2%, to $319.1 million from $326.2 million in 2023. The gross margin for this quarter was $123.1 million, down 5.9% from the previous year. The company faced increased selling, general, and administrative (SG&A) expenses, which rose by 10.2% to $304.1 million for the nine months ended September 30, 2024. Net income for the same period was $47.3 million, a decline from $94.0 million in 2023.

Introduction to Arhaus as a Leader in the Industry

Arhaus, Inc. has established itself as a leader in the home furnishings industry through its commitment to quality, sustainability, and innovative design. The company’s unique retail strategy combines physical Showrooms with a robust eCommerce platform, allowing customers to engage with the brand both online and in-person. This omni-channel approach has significantly enhanced customer experience and brand loyalty. Arhaus focuses on creating a dynamic retail environment that showcases its products as more than just items for sale but as part of a lifestyle choice for its customers.

With its ongoing expansion, including the opening of new Showrooms and investment in technology and supply chain improvements, Arhaus remains well-positioned to capitalize on market opportunities and continue its growth trajectory. The company's focus on sustainable sourcing and community engagement further solidifies its status as a forward-thinking leader in the furniture retail sector.

Mission Statement of Arhaus, Inc. (ARHS)

Mission Statement Overview

The mission statement of Arhaus, Inc. (ARHS) is central to its strategic direction and operational framework. It emphasizes the company's commitment to delivering high-quality, sustainable home furnishings while fostering a unique shopping experience for customers. This mission aligns with their long-term goals, focusing on growth, community engagement, and environmental responsibility.

Core Component 1: Quality Products

Arhaus is dedicated to offering high-quality products that enhance the living spaces of its customers. The company sources materials responsibly and emphasizes craftsmanship in its furniture and home decor items. In the nine months ended September 30, 2024, Arhaus generated $924.1 million in net revenue, a reflection of its strong market presence and customer loyalty despite a 2.1% decrease from the previous year .

Core Component 2: Customer Experience

Another core component of Arhaus's mission is to create an exceptional customer experience. The company operates 101 showrooms across the United States, providing clients with a theater-like shopping environment complemented by expert guidance from seasoned sales associates and in-home designers . This approach not only enhances customer engagement but also drives sales, with retail sales accounting for $766.1 million of total net revenue in 2024.

Core Component 3: Sustainability and Community Engagement

Arhaus places a strong emphasis on sustainability and community involvement. The company has committed to environmentally responsible practices, including a $10.0 million donation to The Nature Conservancy. This commitment to sustainability is reflected in their product offerings, which prioritize materials that are both durable and eco-friendly. In 2024, SG&A expenses rose by 10.2% to $304.1 million, driven by investments in sustainability initiatives and showroom enhancements .

Vision Statement of Arhaus, Inc. (ARHS)

Vision Statement Overview

The vision statement of Arhaus, Inc. (ARHS) focuses on creating a sustainable and luxurious living environment through high-quality, handcrafted products that inspire customers to express their unique style. This vision is reflected in their commitment to sustainability, customer engagement, and innovative design.

Commitment to Sustainability

Arhaus is dedicated to sustainability, aiming to minimize its environmental impact through responsible sourcing and production practices. In 2024, the company has pledged to use 100% sustainably sourced wood in its products. This initiative aligns with their vision of promoting environmentally friendly practices in the furniture industry.

As of September 30, 2024, Arhaus has committed to a $10 million donation to The Nature Conservancy, which reflects their dedication to environmental stewardship.

Customer Engagement and Experience

Arhaus envisions a retail experience that fosters deep connections with customers. The company operates 101 showrooms, with 88 featuring in-home interior designers to enhance customer experience. As of September 30, 2024, Arhaus generated $924.1 million in net revenue, reflecting strong customer engagement.

Innovative Design and Product Quality

Arhaus places a strong emphasis on innovative design, ensuring that each product resonates with customers' lifestyles. In 2024, the company has increased its capital expenditures by $14.8 million to enhance product offerings and showroom experiences.

As of September 30, 2024, the gross margin as a percentage of net revenue was 39.2%, a decrease from 42.3% in 2023, indicating a focus on maintaining quality while managing costs.

Future Growth and Expansion

Arhaus envisions future growth through strategic expansion and innovation. The company plans to open new showrooms and enhance its digital presence, projecting total capital expenditures of approximately $80 million for fiscal year 2024.

As of September 30, 2024, Arhaus had a total of 101 showrooms, up from 92 the previous year, indicating a strong growth trajectory.

Core Values of Arhaus, Inc. (ARHS)

Integrity

The core value of integrity emphasizes the importance of honesty and transparency in all business dealings. Arhaus, Inc. (ARHS) demonstrates its commitment to integrity through various initiatives and practices.

For instance, the company has established strict compliance protocols to ensure adherence to ethical standards. As of September 30, 2024, Arhaus reported a commitment to transparency in its financial disclosures, with net revenue of $924.1 million, showcasing a responsible approach to financial reporting.

Quality

Quality is a fundamental value at Arhaus, reflecting its dedication to providing high-quality products and services. The company emphasizes sourcing materials from sustainable suppliers, ensuring that its offerings meet stringent quality standards.

In 2024, Arhaus reported a gross margin of $362.5 million for the nine months ended September 30, demonstrating its focus on maintaining quality while managing costs. The company also invests in craftsmanship, as evident from its diverse merchandise categories, including furniture and décor, which are designed to last.

Sustainability

Sustainability is a core value that guides Arhaus in its operations and product offerings. The company is committed to minimizing its environmental footprint through responsible sourcing and manufacturing practices.

In August 2023, Arhaus pledged a $10 million donation to The Nature Conservancy, a testament to its commitment to environmental stewardship. As of September 30, 2024, this commitment has been fully realized. Additionally, the company operates 101 showrooms, incorporating sustainable design principles in their construction and operations.

Customer Focus

At Arhaus, a strong focus on customer satisfaction drives business decisions and operations. The company aims to create an exceptional shopping experience, both online and in its showrooms.

As of September 30, 2024, Arhaus reported a net revenue decrease of 2.1% compared to the previous year, attributed to lower total demand. However, the company continuously seeks feedback to improve its services, ensuring that customer needs are met effectively. This proactive approach has positioned Arhaus as a leader in customer engagement within the home furnishings industry.

Community Engagement

Community engagement reflects Arhaus's commitment to contributing positively to the communities it serves. The company actively participates in local initiatives and supports various charitable organizations.

During the nine months ended September 30, 2024, Arhaus reported an increase in SG&A expenses, primarily due to strategic investments aimed at enhancing community outreach programs. This not only demonstrates financial commitment but also highlights the company's dedication to fostering strong community ties.

Updated on 16 Nov 2024

Resources:

1. Arhaus, Inc. (ARHS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Arhaus, Inc. (ARHS)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Arhaus, Inc. (ARHS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.