PRINT THIS STORY:

CHANGE TEXT SIZE:

IN BRIEF

Wet Seal comps up 56 percent

The Wet Seal said its second-quarter net sales rose 19.5 percent and same-store sales increased 55.9 percent. But the Foothill Ranch, Calif.-based chain, which operates 305 Wet Seal stores and 91 Arden B. stores, also posted a net loss of $11.7 million for the quarter because of a $16 million compensation package paid to merchandising consultant Michael Gold. The company credits Gold, who owns the YM Canadian women’s apparel chain, with helping mastermind its current sales turnaround.

Wet Seal has posted double-digit same-store sales growth each month so far this year, versus an overall decline of 14.2 percent last year. Since May, same-store sales have grown more than 50 percent each month. The chain closed 153 unprofitable Wet Seal stores during the fourth quarter of 2004 and the first quarter of 2005.

It also slashed operating expenses to 21.1 percent of sales for the first quarter, from 28 percent a year ago, by spending less money on advertising and salaries and discontinuing its in-store television network, Seal TV. Gold will continue in his advisory role until January 2007.

P.F. Chang’s Japanese concept

P.F. Chang’s is testing a new upscale Japanese food concept called Taneko Tavern. The company plans to open a 5,300-square-foot prototype at the Borgata shopping center in Scottsdale, Ariz., in mid-2006, executives told a local design review board last week. Taneko, which will serve such dishes as sake-braised pork ribs and Kobe steak, will be the most upscale of the company’s three brands and offer an alternative to Japanese food lovers beyond a typical sushi bar or Benihana-style experience, executives said. The average tab will be about $30.

Zale refocuses upscale division

Jewelry giant Zale Corp. said it will close about 35 of its 110 Bailey Banks & Biddle stores next year. The stores, which are to close following this holiday season, “do not fit with our Bailey Banks & Biddle strategy,” said President and CEO Mary Forte. Zale wants to shrink its Bailey Banks & Biddle store base while boosting investment and square footage at key locations, Forte said. Besides the Bailey stores, Dallas-based Zale currently operates 750 Zales, 105 Zale Outlet stores, 160 Mappins units and 965 Piercing Pagoda kiosks, all in the U.S. The company also operates 170 Peoples stores in Canada. Zale said it anticipates same-store sales growth of about 3 percent for fiscal 2006 and that it plans to open 65 stores and 40 kiosks. The company has also launched a $100 million stock buyback program.

Dave & Buster’s nixes Jillian’s

Dave & Buster’s is giving up hope of reviving the nine-store Jillian’s chain it acquired last year for $48.5 million. The Dallas-based restaurant-entertainment company said it will kill the Jillian’s brand name, stamp the Dave & Buster’s banner on eight of the stores and close the one at Mall of America, outside Minneapolis. The company says it spent more than $18 million on the stores, but their sales did not improve. The Mall of America unit in particular was a drain on profits, accounting for more than 40 percent of losses among the Jillian’s stores, the company said.

The others — in Baltimore; Concord, N.C.; Farmingdale and Westbury, N.Y.; Houston; Nashville, Tenn.; Philadelphia; and Phoenix — will be rebranded. Many of the units to be converted operate in malls owned by The Mills Corp. “We will rebrand the first Jillian’s to Dave & Buster’s next month,” said Dave Corriveau, Dave & Buster’s president. “Our current plan is to have 10 to 12 more stores operating under the Dave & Buster’s brand within a year from today.” Because of the Jillian’s sales shortfalls, Dave & Buster’s said it will cut back its earnings guidance for the rest of the year by 40 percent.

Gas prices hit Dollar Tree

Dollar Tree Stores blamed its 8 percent second-quarter drop in profits on gas prices, which kept shoppers home. Overall sales rose 9.2 percent for the quarter, to $769 million, but same-store sales fell 1.5 percent. “It is evident that our customers continue to feel the strain of rising fuel costs, and they are responding with fewer shopping trips,” said President and CEO Bob Sasser in a press release. The company did see a 1.1 percent increase in customer spending, Sasser said, but against that spending was a 2.6 percent drop in store traffic. The company says it is boosting its selections of high-tech items not usually found at dollar stores, including photo paper and ink for printing digital pictures. Those items, Sasser says, are selling well.

Kohl’s unveils expansion plan

The contraction of rival department store chains has boosted Kohl’s expansion plans, executives said at an analyst presentation. The Menomonee Falls, Wis.-based retailer, which currently operates 637 stores, will open about 500 over the next five years, 200 of them by 2007. As Federated, Mervyns and Sears continue to shed stores, Kohl’s will use its cash reserves to scoop up the best locations, says CEO Larry Montgomery.

“These changes will provide not only market share opportunities but real estate opportunities as well,” he said. Florida and the Pacific Northwest will be target areas, he says, and Kohl’s has three different prototypes, including rural and urban footprints, to target markets more specifically. Kohl’s is also looking to compete with specialty apparel stores for boomers and younger women, a new tack for the retailer, whose “sweet spot is the classic American family,” said COO Arlene Meier. New Kohl’s stores will feature more exterior glass, says Montgomery, to allow passersby to see inside.

J. Crew files for IPO

J. Crew is going public. The New York City-based apparel retailer hopes to raise as much as $200 million through its IPO, according to documents J. Crew Group filed in August. J. Crew says it plans to open seven new stores this year and about 20 next year. After that, the retailer says, it wants to open roughly 30 stores annually. The filing comes 30 months after J. Crew’s hiring of former Gap Inc. CEO Millard S. Drexler to lead a turnaround effort.

Private equity firm Texas Pacific Group, which will buy $73.5 million worth of common shares, controls the company. J. Crew, which posted net losses for four of the past five fiscal years, says it plans to use some of the proceeds from the stock issue to refinance debt. The chain would trade on the New York Stock Exchange under the symbol JCG. J. Crew did not disclose how many shares it would issue, or the price range.

PacSun’s takes big footwear step

Anaheim, Calif.-based casual apparel retailer Pacific Sunwear of California plans to roll out a new footwear concept called One Thousand Steps. The company says it expects to begin opening the stores in malls next year. The new concept builds on the assortment of casual shoes in the chain’s 780 PacSun stores. The selection of casual, fashionable, branded footwear is aimed at 18-to-24-year-olds. Pacific Sunwear plans to open eight to 10 stores, each measuring about 2,500 square feet, during the first half of next year. The company says it believes the concept can eventually sustain 600 to 800 stores.

Sears Holdings 2Q sales down

Sears Holdings has ousted chief executive Alan Lacy in favor of former Kmart chief Aylwin Lewis, who will become CEO and president. Edward Lampert, chairman of Sears Holdings, will take the reins of the company’s marketing, merchandising and online businesses. For the second quarter, Kmart’s comparable store sales and total sales decreased 0.3 percent and 3.2 percent, respectively. Sears’ total U.S. sales declined 3 percent for the quarter.

© 2008 ICSC. All rights reserved. | Terms and Conditions | Privacy Policy | Contact ICSC | ICSC Home |