DFS will trial a small format store that is a 10th the size of its average shop as it seeks to explore new formats including city centre stores.

DFS will trial a small format store in Westfield Stratford

The furniture retailer will open the 2,500 sq ft DFS-branded store at Westfield Stratford. Plans for the new stores were laid out in the company’s prospectus for its upcoming stock market flotation.

The prospectus stated the retailer’s growth strategy involves the roll-out of smaller format stores and their success relies on selecting the appropriate product ranges for display and identifying customer demand in different geographical areas.

It added: “The opening of such smaller format stores could also result in the diversion of sales from the group’s existing stores creating an over-saturation of the market, which may cause a reduction in sales at affected stores.”

The typical DFS store is approximately 20,000 sq ft in size. Alongside exploring city centre stores, the retailer is also experimenting with reducing the size of its retail park stores down to 10,000 sq ft.

DFS has opened three stores of 10,000 sq ft, which are being rolled out to target market towns.

DFS has already opened small format city centre stores for its Sofa Workshop and Dwell brands, but its upcoming Westfield Stratford outlet will be the first time it has opened a small format store under the DFS brand.

In order to support the changing shape of its store estate, DFS is also trialling a number of customer distribution centres (CDCs) as it explores replacing its in-store warehouse model.

DFS hopes the opening of CDCs will enable it to reduce incremental retail space by a total of 400,000 sq ft and allow it to increase warehousing and delivery efficiency.