The Container Store has aquired Chicago-based home storage solutions and closet organization company Closet Works for $21.5 million. This strategic acquisition will expand The Container Store’s manufacturing capabilities to include wood-based spaces and enhance its premium wood-based product offering. The Company already manufactures its component-based systems through its wholly owned subsidiary Elfa.
The acquisition provides access to quality equipment and facilities located centrally in the United States and will allow the retailer to control the process from product manufacturing to installation. This will give the company opportunities for increased quality control and expanded profit margins. Additionally, The Container Store expects to offer more design customization options to customers and premium wood-based spaces including closets, garages, home offices, pantries, laundry rooms and murphy beds. An enhanced garage offering is a specific area the company has identified as an opportunity for growth.
“As part of our effort to double our sales over time, I am thrilled to announce our strategic acquisition of Closet Works,” said The Container Store president and CEO, Satish Malhotra. “This acquisition allows us to meet the growing consumer demand for premium wood-based spaces and expand our capabilities, in an effort to gain a larger share of the estimated six-billion-dollar custom closet market – particularly in spaces above $2,000 – with expanded profit margins. We look forward to working with the talented team at Closet Works to strengthen our leadership position in this category.”
Closet Works president and previous co-owner, Tom Happ, has joined The Container Store as president of Closet Works and will assist with the integration. The transaction closed on December 30, 2021.