Crate & Barrel has long sold items to help shoppers prepare and serve meals at home, from dinnerware and drinkware to cutlery and kitchen tools. But for those who’d rather take a night off from home cooking, next spring its Oakbrook Center store will get a full-service restaurant. The restaurant is a partnership between the Northbrook-based home goods retailer and Chicago’s Cornerstone Restaurant Group, with Chicago chef Bill Kim overseeing menu development. “As a longtime destination for dining and housewares, we know that our customers love to entertain, and incorporating food and beverage offerings is a natural extension of the Crate & Barrel brand,” CEO Neela Montgomery said in an email. While the restaurant isn’t expected to open until spring, Crate & Barrel’s culinary ambitions have already prompted a lawsuit from competing home retailer RH, formerly Restoration Hardware. In a lawsuit filed in January 2017 in California, RH accused Crate & Barrel of trying to copy the playbook for its food and beverage concept. The first of those locations, Three Arts Club Cafe, opened in Chicago in 2015. The nearly 70,000-square-foot space includes a gallery, design services, a coffee and pastry shop, a wine bar, and a courtyard restaurant. Two executives who left RH for its competitor, including former Crate & Barrel CEO Douglas Diemoz, were also named as defendants. Montgomery, who took over for Diemoz last year, said the lawsuit has been resolved and declined to comment further on the outcome. She noted Crate & Barrel had a coffee shop at its store in Chicago’s Ranch Triangle neighborhood more than 20 years ago and said mixing food and beverage and retail is not a new concept.

Plans for Crate & Barrel’s Oakbrook Center store are still being finalized, but they currently include outdoor dining space on two levels and indoor dining on one level. The retailer is considering offering cooking demonstrations and other events, and it’s looking into options for permits that would let customers browse with a glass of wine while waiting for a table. Montgomery said the restaurant will be an opportunity to give customers a memorable experience at one of the chain’s stores. Crate & Barrel closed its Michigan Avenue flagship in January, but the company said sales at stores open at least a year have been growing over the past two years, including an 8 percent increase in 2017. For now, Oakbrook Center will be the retailer’s only store-restaurant combo. “Though we don’t have concrete plans for more restaurants in additional locations at this time, we’re always exploring new ways to offer meaningful moments to our customers beyond the traditional shopping experience,” Montgomery said. It’s also a first for Cornerstone, which hasn’t operated inside a retail store before, CEO David Zadikoff said in an emailed statement. Zadikoff said he thinks the restaurant can benefit from the partnership too. “For a restaurant concept, having a built-in customer base is crucial, and it’s even better that Crate’s target market loves to dine and entertain,” he wrote. Department store restaurants, like the Walnut Room in Macy’s State Street flagship, have a long history. More recently, as retailers have embraced the in-store experience to compete with online retail, restaurants have popped up in big chains like Urban Outfitters and Barnes & Noble and small boutiques like Space 519 in Chicago’s Gold Coast neighborhood. Results have been mixed. In a letter announcing RH’s second-quarter financial results last week, Chairman and CEO Gary Frieman said each of its first four restaurants were generating between $4 million and $6 million a year. A fifth opened in New York City on Wednesday, and Friedman said the company plans to add more. Brendan Sodikoff, founder and CEO of Chicago’s Hogsalt Hospitality, is also president of RH’s hospitality business. But Leonard Riggio, Barnes & Noble’s chairman and founder, said last week during a call with investors that results from its five restaurants have been “a very mixed bag.” It’s not clear whether there will be more in future stores, though the bookseller is aiming to grow its cafe business, he said. “We do not have a culture of running, operating restaurants … things like controlling food costs and payroll costs are not in our DNA,” Riggio said. “It’s a lot harder than you think it is.” A restaurant isn’t likely to bring in shoppers who wouldn’t otherwise visit the store unless the retailer can offer real destination dining, particularly in a mall with other dining options, said Candace Corlett, president of consulting firm WSL Strategic Retail. Friedman said RH does see restaurants driving extra retail sales during a call with investors last week, though he declined to say how much crossover there was. But a restaurant could also be a way to encourage customers to stay and browse, give them space to consider a purchase and “move shoppers from undecided to decided,” Corlett said. Retailers would generally be smart to partner with a company that specializes in the restaurant business, she added. “They’re just two very different businesses, and it’s not wise to think that because you know how to run one you know how to do both,” she said. – Source: The Chicago Tribune