The company is in a healthy financial position, with no outstanding debt, meaning it has a good chance of surviving an economic downturn. It uses its cash flow to purchase property and take leases on warehouses, opening 30 to 40 stores every year. Hobby Lobby chooses high-value locations in major cities, usually in high-income areas. District managers visit each store once a month, spot-checking at least 100-items from the company's list of over 67,000 SKUs. It's the key to the business model's success. Green says that Hobby Lobby focuses on trends, not fads. The company sources its products from trade shows, looking for trending items. The company's target buyer persona is women in their twenties and thirties with a middle-class lifestyle and income. Most of its products cater to a range of hobbies, from arts and crafts to haberdashery and many more. It focuses on selling non-essential goods that rely on customers with high disposable income levels. The company caters to a broad demographic and market.
Hobby Lobby makes money by selling products - and plenty of them. The company steers away from constructing new retail space, which they view as critical to their competitive advantage in the arts and crafts industry. As a result, Hobby Lobby saves 50% to 70% on its operating costs using this model compared to building new warehouses. Typically, the company looks for new locations in mid to high-income areas. Hobby Lobby looks to rent or purchase real estate previously owned by big-box retailers, converting them into warehouses and stores.
The company has 969 stores operating across 47 states, with only Vermont, Alaska, and Hawaii being unexplored territory for the company. Hobby Lobby operates a US-facing business model, serving the American market. It also sells a wide variety of consumer products, from furniture to fabrics. The company sells trinkets and party favors for occasions like Christmas and Easter, focusing on Christian holidays. Green is the son of a preacher, and he has strong Christian beliefs.Īccording to the company's official website, its mission statement is, "Honoring the Lord in all we do by operating the company in a manner consistent with Biblical principles." Hobby Lobby is a Christian-owned business led by entrepreneur David Green.
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