May 16, 2007, 12:00 AM

Design Within Reach 2006 web sales climb to $30 million

Design Within Reach’s delayed annual financial report indicates 2006 web sales rose 2.7% to $30 million. The reporting delays stemmed from a failed information system upgrade the retailer implemented beginning in 2005.

After lengthy reporting delays attributed to a failed information system upgrade in 2005, Design Within Reach Inc. posted 2006 web sales of $30 million, a 2.7% increase from fiscal 2005. Installation of the new information system is under way and completion is expected later this year.

Overall net sales for the fiscal year ending Dec. 30, 2006, were $178.1 million, up 13% from $158.2 million in 2005. Design Within Reach, No. 213 in the Internet Retailer Top 500 Guide, is a multi-channel retailer specializing in designer furniture at affordable prices.

The company uses its web and catalog marketing resources to drive studio, or physical store, sales. Even though web channel sales have grown each year since 2004, web sales as a percentage of all sales have declined four percentage points per year since 2004. In 2006, the web represented 17% of Design Within Reach sales.

Catalog sales have seen a steeper drop, with sales declining 24% from $25.46 million in 2004 to $19.44 million in 2006. Catalog sales lost just over 10 percentage points during the same time period.

“Online sales are an essential component of our multi-channel strategy. In addition to driving traffic to our web site through our other sales channels, we have entered into marketing agreements with select agencies to manage multiple pay-per-click search engine campaigns to increase the number of qualified visits to our web site,” company executives say.

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