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JC Penney Sets Aggressive Store Opening Plan

October 1, 2010

J.C. Penney Co. Inc. on Tuesday said it will open three stores next year as part of its plan to generate $1 billion in sales growth through new retail expansion over the next five years. Penney’s long term plans call for opening 75 new stores by 2014.

The first three stores are slated for Dallas; Daly City, Calif., which borders San Francisco, and Glenarden, Md., about 10 miles east of Washington. Penney’s has existing stores in all three markets, which cater to middle-income shoppers.

While Wal-Mart Stores Inc. slowed construction of SuperCenters amid the weakening economy and Gap Inc. has said it’s not planning to open new stores in the near term, Penney’s believes the markets it’s identified are underserved by its stores, so it will intensify its presence. The Daly City and Glenarden stores will open in the spring and the Dallas unit will bow in the fall.

Penney’s has an aggressive store-renovation program. By October, more than 750 units will have been renovated during 2010, including 76 major renovations, which took place in California, Florida, Illinois, Maryland, New York and Texas. Penney’s is aggressively expanding Sephora beauty boutiques. The retailer said stores with 1,500-square-foot Sephora installations are performing 1.5 percent better those without them. Other store improvements include in-store shops for new brands such as MNG by Mango, Call It Spring by Aldo, and new fixturing for the rollout of Liz Claiborne across 30 categories. Findmore interactive in-store fixtures are also making their way through the store fleet. Consumers can purchase from jcp.com using the technology.

Penney’s is investing $160 million on the improvements out of its $500 million capital- expenditure budget for the year.

The retailer hopes to complete the major renovations of more than 375 stores by 2014.

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/retail-news/penney-s-sets-aggressive-store-opening-plan-3310480?navSection=retail-news

Target to Roll Out Smaller Stores

September 28, 2010

Target Corp. on Friday said it will unveil 10 smaller, urban footprint stores in 2012, with the first unit bowing in downtown Seattle, just two blocks from Pike’s Market.

The announcement was made during a media conference held at Target Field here, home of the Minnesota Twins. John Griffith, executive vice president of property development, said the size of the stores would be 60,000 square feet to 100,000 square feet. That’s roughly half the size of a typical Target, which ranges from 125,000 square feet to 180,000 square feet.

Griffith said after Seattle, the urban prototype will roll out to San Francisco, Los Angeles, Chicago, Boston, New York, Philadelphia, Miami and the Washington, D.C., area.

Target didn’t discuss the type of merchandise the urban stores will carry, but it’s expected to focus heavily on food and essentials. “We’re trying to fit the Target to the market and not the other way around,” Griffith said.

The cities Target selected have large downtown populations with at least 100,000 people living within a two-mile drive of the store.

Target operates a handful of downtown sites, including Atlantic Terminal in Brooklyn and a new unit in Harlem that opened in July.

Target’s main rival, Wal-Mart Stores Inc., is planning its own aggressive push into urban markets with a new small format with 20,000 square feet of space, a fraction of the size of its Supercenters.

In other Target news, the 1,743-unit chain in June completed the remodeling of 400 stores and added grocery areas called P-Fresh to many SuperTargets.

After an initial test in Kansas City, a new credit card program that offers shoppers the opportunity to save 5 percent on each store visit rolled out to the entire chain, said Doug Scovanner, executive vice president of finance and chief financial officer.

Despite the difficult economy, Target’s sales for the first six months rose 4.7 percent, said Scovanner.

Target revealed one of its holiday promotions. The retailer invited 50 musical acts, from pop to choral to country, to submit an original Christmas song. Six songs will be selected for Target.com where consumers will be able to download them for free starting on Nov. 25

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/retail-news/target-to-roll-out-smaller-stores-3306171?navSection=retail-news

Consumer Confidence Falls to Seven-Month Low

September 28, 2010

The tough business environment and strained job market undermined consumer confidence last month, which fell to its lowest level since February.

The Conference Board’s Consumer Confidence Index retreated to 48.5 from 53.2 in August. The measure of consumer well being stood at 51 in July and 54.3 in June.

“September’s pullback in confidence was due to less-favorable business and labor market conditions, coupled with a more pessimistic short-term outlook,” said Lynn Franco, director of the research group’s Consumer Research Center. “Overall, consumers’ confidence in the state of the economy remains quite grim. And, with so few expecting conditions to improve in the near term, the pace of economic growth is not likely to pick up in the coming months.”

The index is based on a survey of 5,000 U.S. households. The survey found that people are feeling worse about the current environment, with the 46.1 percent of respondents rating business conditions are “bad,” up from 42.3 percent last month.

For further information, visit: http://www.wwd.com/business-news?module=tn#/article/business-news/consumer-confidence-falls-to-seven-month-low-3309044

Retail Rallies on Business Spending

September 27, 2010

Retail stocks gained 3 percent Friday as orders for durable goods hinted at a somewhat more confident corporate America.

The S&P Retail Index perked up 13.37 points to 460.61, rounding out a 5 percent gain for the week. Among the retail winners on Friday were The Talbots Inc., up 10.7 percent to $12.06; Pacific Sunwear of California Inc., 8.9 percent to $4.92; The Bon-Ton Stores Inc., 8.9 percent to $8.72; AnnTaylor Stores Corp., 7.5 percent to $20.24; Sears Holdings Corp., 5.9 percent to $75.13, and Abercrombie & Fitch Co., 5.6 percent to $38.79.

Last week’s advance left retail stocks up 12 percent for the year.

Of 171 equities tracked by WWD, 123 were up last week and 43 down, while five were unchanged. The Dow Jones Industrial Average stepped up 1.9 percent, or 197.84 points, to 10,860.26 Friday, making a 2.4 percent gain for the week. On Friday, the Commerce Department said durable goods orders, outside of the transportation sector, rose 2 percent last month.

Increased orders for machinery, computers and communication equipment demonstrated companies’ willingness to spend that could eventually lead to more hiring, lower unemployment and a broader recovery in the economy, helping to ease fears of a double-dip recession and lifting the equity markets.

European markets also posted gains for the week with the CAC 40 in Paris and the FTSE 100 in London both increasing 1.6 percent. Asian investors were feeling more cautious for the week and pushed the Hang Seng Index up a lesser 0.7 percent in Hong Kong as the Nikkei 225 slid 1.6 percent in Tokyo.

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/business-news/retail-rallies-on-business-spending-3300760

Macy’s Names Ongman EVP

September 23, 2010

Macy’s on Tuesday named Patti Ongman executive vice president and general merchandise manager for center core, overseeing the merchandising for handbags, fashion accessories, hosiery, watches, fashion jewelry and fine jewelry.

Ongman has served as executive vice president and general planning manager for cosmetics, fragrances and shoes since May 2009. Her successor has not been named. She succeeds Richard Arnstein, who was recently named executive vice president and gmm for men’s. Ongman will report to Jeff Gennette, chief merchandising officer and start her new job Oct. 1.

Ongman joined Macy’s in 1981 as a sales manager in the Northlake store in the Atlanta area. She rose to divisional merchandise manager, a regional vice president of the home store division and gmm, among other jobs.

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/retail-news/macys-names-ongman-evp-3294408


September 21, 2010

WASHINGTON — Retail apparel prices declined a seasonally adjusted 0.1 percent in August compared with July and fell 0.4 percent compared with a year earlier, the Labor Department said Friday in its Consumer Price Index.

Women’s apparel prices rose 0.3 percent in August and advanced 0.8 percent year-over-year. Men’s apparel prices declined 1 percent month-to-month and were flat in 12-month comparisons.

The overall CPI edged up 0.3 percent compared with a month earlier and increased 1.1 percent compared with August 2009. The so-called core index, which excludes the volatile food and energy sectors, was flat month-to-month and rose 0.9 percent from a year ago.

Deflation is something to watch as the economic recovery continues at a sluggish pace, said Nigel Gault, chief U.S. economist for IHS Global Insight.

“The main risk on the price front remains that inflation will be too low, not too high,” Gault said.

Prices for women’s outerwear rose 0.4 percent in August and advanced 4.4 percent year-over-year. Women’s dress prices rose 0.3 percent month-to-month, but declined 5.3 percent in 12-month comparisons. Women’s suits and separates prices declined 0.7 percent in August and dropped 1 percent from a year ago. Prices in the broad women’s underwear, nightwear, sportswear and accessories category rose 1.5 percent month-to-month and increased 5.4 percent in 12-month comparisons.

Men’s suits, sport coats and outerwear prices dropped 1.6 percent in August, but rose 3.9 percent from a year ago. Men’s furnishings declined 0.2 percent month-to-month and rose 1.3 percent compared with a year earlier. Men’s shirt and sweater prices edged up 0.2 percent in August, but fell 0.4 percent in 12-month comparisons. Pants and shorts prices fell 1.5 percent compared with a month earlier and decreased 3.7 percent from a year ago.

Boys’ apparel prices rose 4.5 percent in August, but fell 2.8 percent compared with a year earlier. Girls’ apparel prices dropped 3.5 percent month-to-month and tumbled 11.3 percent from a year ago.

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/business-news/august-sees-apparel-price-dip-3282451?navSection=retail-news

Lord & Taylor Said Eyeing Expansion

September 21, 2010

Lord and Taylor; Taylor is aiming to expand for the first time in about a decade.

Sources said the retailer is seeking a second location in Westchester County, N.Y., largely based on the success of its Scarsdale branch in Westchester. That unit is the chain’s best-performing branch store. It is said to generate between $90 million and $100 million in annual sales, ranking second in volume behind L&T’s Fifth Avenue flagship.

The retail chain owns the 180,000-square-foot Scarsdale location, both land and building. However, a source noted it can not be expanded.

“They feel there is more opportunity for business in Westchester,” said the source.

L&T executives declined to comment.

The last time L&T opened a store was in 2000 in Willow Bend, Tex., which is in the Dallas metropolitan area. The unit closed a couple of years later.

The retailer operates 46 full-line stores and one outlet, which opened in February in Elizabeth, N.J. NRDC Equity Partners, L&T’s parent, committed to spending $250 million to renovate the current fleet of stores. The 650,000-square-foot Fifth Avenue flagship is getting $150 million of that money to overhaul the main, second and 10th floors in an effort to attract younger shoppers in addition to its core shoppers, and this year has been citing sales gains ahead of the industry average.

L&T is said to do best in suburban locations, where it has a long history. The chain was among the first fashion department stores to open a branch in the U.S. — in 1941 in Manhasset, N.Y.

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/retail-news/lord-taylor-said-eyeing-expansion-3281957?navSection=retail-news

Wal-Mart to aggressively roll out smaller stores

September 21, 2010

NEW YORK  — Wal-Mart Stores Inc. is planning an aggressive push into urban markets with a new small format that’s a fraction of the size of its supercenters.

The expansion, expected to be spelled out next month at the retailer’s meeting with analysts at its headquarters in Bentonville, Ark., is aimed to pump up sluggish U.S. sales.

Real estate executives said that over this past summer, the world’s largest retailer has been scouring for small locations, around 20,000 square feet, in urban areas including New York City, San Francisco and other cities. That size is larger than a typical drugstore but smaller than a supermarket.

“I see this as a smart move, instead of coming into a market as a 900-pound gorilla,” said Faith Consolo, chairman of real estate firm Prudential Douglas Elliman’s retail leasing division. She noted that Wal-Mart has been talking to landlords and brokers.

“They’re on an aggressive roll,” she added. “This is a creative time. Everyone is thinking out of the box.”

She noted that in New York City, Wal-Mart has been looking in Queens and the lower part of Manhattan.

Since 2008, Wal-Mart has been testing smaller stores called Marketside. They now total four and average 15,000 square feet. The format focuses on fresh food. And the discounter now has almost 200 Neighborhood Market by Walmart stores, which offer a mix of fresh food, pharmacy, beauty, stationary and pet supplies and are about 42,000 square feet.

Wal-Mart has been shrinking its supercenters, which carry a wide assortment of food and general merchandise, to about 150,000 square feet from 195,000 square feet. But the company has maintained that it plans to use smaller formats in urban markets.

In a note to investors Monday, Brian Sozzi, analyst with Wall Street Strategies, said he believes the new 20,000-square-foot stores would likely fuse the Marketside and Neighborhood Markets formats.

“Wal-Mart needs to have a store concept that brings in customers more than once every two weeks when paychecks are distributed,” he wrote. He added that using the Marketside Stores as a vehicle for growth is too limiting, and that Neighborhood Markets are too big to enter cities.

Wal-Mart spokesman Steven Restivo said Monday that “while we have not shared an exact size of the small format … we continue to evaluate a wide range of stores sizes across the country and will consider any format that puts us closer to our customers.”

Bill Simon, the new president and CEO of Wal-Mart’s U.S. business, told investors last week at a Goldman Sachs retail conference, said that “we will have a healthy mix of supercenters and small formats, including our grocery format, Neighborhood Market and smaller formats,” he continued. He added that in particular, Wal-Mart is looking to open stores that are similar to the formats in Mexico, Central America, and Latin America.

“We are going to beg, borrow, steal and learn from them as quickly as we can, because it is important for our urban strategy,” he added.

Wal-Mart, which now has more than 4,000 stores in the U.S. has hit a wall in the U.S. The company just reported its fifth straight quarterly decline in revenue at stores opened at least a year, considered a key indicator of a retailer’s health.

Wal-Mart benefited during the recession as affluent shoppers traded down to cheaper stores. But stubbornly high unemployment and tight credit are still squeezing its main U.S. customers, lower-income workers who are having even more trouble stretching dollars to the next payday because of tight credit and an unemployment rate stuck at almost 10 percent. The discounter’s own merchandising gaffes have also contributed to the company’s revenue figure’s decline.

Wal-Mart’s rival Target Corp. is set to spell out more details of its urban strategy on Friday to the media at its headquarters in Minneapolis. Target had told analysts in January that it plans to open in the next few years smaller stores of 60,000 to 100,000 square feet. That compares with its current average of 125,000 square feet. But real estate executives including John Bemis, head of Jones Lang LaSalle Inc.’s retail leasing team, say Target also is looking at 20,000-square-foot locations.

“I think 20,000 makes more sense than 80,000 square feet,” Sozzi said.

For further information, visit: http://www.cleveland.com/business/index.ssf/2010/09/wal-mart_to_aggressively_roll.html

Retail Stocks Are Slowly Rising

July 29, 2009

Retail stocks rose Wednesday in the wake of better-than-expected corporate earnings reports. Apparel giant VF Corp. jumped after its second-quarter profit decline was smaller than expected and it signaled an improved second-half outlook.

The S&P Retail Index rose 1.4% to 344.99. VF, owner of brands from Wrangler to 7 for All Mankind, climbed 6.8% to $64.68.

The company said late Tuesday that while business remains tough and profit was hurt by a stronger dollar and pension costs, its largest brands – Wrangler, Lee, North Face and Vans, continued to gain market share. Chief Executive Eric Wiseman also said that profit and sales in the second half of the year should show a “marked improvement” from the first half.

The positive surprise from VF also bodes well for results from other apparel companies, analysts said. Jones Apparel Group Inc. rose 2.3%. Liz Claiborne Inc. was up 1.4%.

VF’s results “will alleviate concerns about another leg down in vendor industry earnings and represents a good first step towards rebuilding investor confidence in management’s ability to plan and execute after last quarter’s earnings disappointment,” said Credit Suisse analyst Omar Saad. “The fact that management is now seeing signs that international businesses are starting to stabilize suggests that the global apparel recession could be in its final throws in certain regions.”

VF’s net income fell to $75.5 million, or 68 cents a share, from $104 million, or 94 cents, a year ago. Revenue for the three months ended June 30 fell 11% to $1.49 billion. Analysts polled by FactSet Research had predicted the Greensboro, N.C.-based company would earn 57 cents a share on $1.53 billion in revenue. The company said it expects to earn between $4.70 and $5 a share for the full year, in line with analysts’ expectations of $4.84.

Investor sentiment also was helped by coffee giant Starbucks Corp.’s better-than-expected quarterly result and the company showed that its traffic has improved even as consumers remain watchful of what they spend. See full story. Tech bellwether Apple Inc.’s quarterly results also beat Wall Street expectations as it sold 5.2 million iPhone units and recorded strong sales of Mackintosh computers.

Largest U.S. electronics retailer Best Buy Co. was down 0.6%. Wal-Mart Stores Inc., the world’s biggest retailer that’s also making a push in electronics, was up 0.3%.

For further information, visit: http://www.marketwatch.com/story/retail-stocks-rise-as-apparel-giant-vf-beats-views

Jones Apparel Outbeats the Recessions Bad News

July 29, 2009

Jones Apparel Group Inc reported a higher-than-expected second-quarter profit on Wednesday, bolstered by cost cuts and the strong performance of its wholesale jeans business.

The owner of the Jones New York, Nine West and Anne Klein brands has cut jobs, closed stores and managed inventory tightly in a bid to reduce costs in the recession.

Net income available to common shareholders rose to $12.6 million, or 15 cents a share, from $10.5 million, or 12 cents a share, a year earlier.

Excluding items, the company earned 29 cents a share. This compares with analysts’ expectations of 7 cents, according to Reuters Estimates.

Revenue fell about 3 percent to $804 million.

Jones said it planned to close about 240 retail stores this year and next, and it expects the move to improve profit by about $4 million this year, $15 million next year and $21 million in 2011.

While sales at the company’s wholesale jeanswear division rose 28.5 percent, revenue fell at the other segments. Jones’ retail business includes chains such as Easy Spirit and Enzo Angiolini.

The company’s wholesale jeans business has gotten a boost from an exclusive deal to sell its l.e.i. line at Wal-Mart Stores Inc.

At the same time, Jones is testing a new retail chain called ShoeWoo, which would sell many shoe brands and be larger than most of its current stores.

The company, which in April had forecast 2009 revenue at $3.3 billion to $3.5 billion, said it remained cautious in its outlook for the rest of 2009.

For more information, visit: http://www.reuters.com/article/marketsNews/idUSBNG12836220090729