Home furniture in bulk? Costco to try new focus

Sofas, 10 to the pack?

Not quite, but after stuffing countless pantries and closets with bulk goods at cheap prices, Costco is aiming to fill rooms in the house with furniture, appliances and other furnishings.

The Issaquah-based warehouse retailer plans to open its first "home-furnishing center" in Kirkland, possibly in time for the Christmas shopping season, said Jim Sinegal, Costco's president and chief executive officer.

For a company that has built its success on selling thousands of things in huge warehouses, the new store's focus on furniture is something of a departure.

The company is still fleshing out the details, but Sinegal said the plan is to offer Costco members a wide range of brand-name bedroom sets, dining-room tables, dishwashers and more at a discount.

If it is a hit, Costco could carve out a chunk of the competitive home-furnishing market from the likes of Ikea, J.C. Penney, Levitz and the mom-and-pop shops that dominate the industry.

"We experiment with stuff all the time, and that is what this is," Sinegal said. "What we don't know is whether it will have a sufficient enough appeal that we would want to roll this out to other communities."

If it does, Costco would look to Portland and the Bay Area next, Sinegal said.

The company, which runs some 385 warehouses worldwide, plans to move into the former HomeBase store on Northeast 118th Street in Totem Lake. It is working with Kirkland planning officials to get permits.

Costco typically stocks some furniture and appliances at warehouse stores and brings in a bigger selection when space allows.

"The question is whether home furnishings without the allure of all the other things at Costco (warehouses) can be as successful in a free-standing furniture place," Sinegal said.

Others big-name retailers have tried to crack the market in recent years, with mixed success. Sears launched its ill-fated HomeLife stores in the 1990s and eventually spun off the company before it went bankrupt.

The Swedish retailer Ikea has done well in North America and has ambitious expansion plans. But Bjorn Bayley, owner of Ikea in Renton, said the market is a tough one.

Costco's merchandising talent and buying power will come in handy, but is no guarantee of success, Bayley said.

"I don't think it is a cakewalk," he said. "There are a lot of failures along the road."

News of Costco's plans caught some financial analysts by surprise, mostly because furniture is not considered one of the company's core specialties.

"It seems a little outside the mainstream of the products they have featured historically," said Bob Toomey, an analyst for RBC Dain Rauscher in Seattle. "But if you think about, if they can apply the same merchandising principals for the business and execute them the way they have, it can be successful."

Marty McOmber: 206-464-2022 or mmcomber@seattletimes.com