Why is LifeWay closing its brick-and-mortar stores?
Consumer spending patterns have changed dramatically in the last five years. Leading business analysts are calling 2019 the year of the retail apocalypse. In this context, LifeWay Christian Stores lost $19 million last year. Over the past five years, the cumulative losses of LifeWay Stores reached nearly $50 million. Our internal projections showed those losses—at the current pace—would have increased to more than $60 million per year by 2021.
Sustaining losses at this rate is poor stewardship and compromises the overall ministry of LifeWay.
If the losses were so bad, why didn’t you close the stores sooner?
Since 1891, LifeWay has operated as a ministry funded by a solvent business model. In fact, LifeWay is the only Southern Baptist Convention entity that has never received Cooperative Program allocations. For many years, LifeWay Stores were subsidized by other ministry areas that operated in the black. Our commitment to the ministry impact of LifeWay Stores factored heavily in decisions to subsidize them despite increasing revenue losses over many years.
When was the decision made to close all the stores and who made the final decision?
We were cautiously optimistic going into the 2018 Christmas season that sales would increase. When the real numbers began coming in earlier this year, we knew some closures were inevitable. As we began to assess the future of LifeWay’s brick-and-mortar presence, it became clear a retail chain of any size was unsustainable. LifeWay’s Executive Leadership Team, with full support of the trustees, made the final decision in March 2019.
What did you do to try to save the stores?
Over the past several years, LifeWay spent a significant amount of energy and financial resources on our retail store chain to increase traffic and sales. We looked at best practices of companies operating similar retail outlets and engaged multiple retail consultants. We applied best practices in a manner consistent with our biblical values and ministry assignment. Last year, we ran more than 40 tests to improve our brick-and-mortar store experience and sales performance. We invested in technology, launched new marketing initiatives, and engaged new customer opportunities to help drive traffic and increase sales. We were hopeful these efforts would minimize the decline of retail sales and turn revenue in a positive direction. Our efforts did not prove fruitful, and sales continued to decline.
Why close all the stores? Weren’t some of them profitable?
While sales at some stores fared better than others, losses throughout the chain as a whole presented an increasing liability that threatened our core ministry. Every internal model we ran showed that within the next two to three years not a single store would be profitable.
What is LifeWay doing to assist employees impacted by the store closures?
LifeWay is committed to helping our store employees transition well. We are providing a comprehensive package of benefits to those impacted by the closures, including severance pay where applicable, one-on-one benefit discussions and outplacement services.
Doesn’t LifeWay have a ministry assignment from the SBC to operate stores?
Yes, and we will continue to provide our resources at competitive prices through our online store at LifeWay.com, as well as provide LifeWay Stores at regional and national events. The closure of our proprietary brick-and-mortar stores expands the opportunity to provide LifeWay resources globally through multiple retail channels.
Will there be LifeWay event stores in the future?
Yes. LifeWay will continue to operate a store at the SBC Annual Meeting and hundreds of other national and regional events.
What is the future of the organization? How will LifeWay continue to serve churches and individuals?
LifeWay serves both individuals and churches with a healthy and growing core business. These resources include books, Bibles, Bible studies, VBS, ongoing curriculum, church music, church supplies, events, digital platforms and specialized services. LifeWay will continue to serve customers through multiple channels, including LifeWay.com, our Customer Service Center and a network of church partners. The changes we are making in 2019 give us opportunities to expand our reach, better serve our customers, and get the message of the gospel to the world. Our mission has not changed; we will continue to provide biblical solutions for life.