Frank's expands home decor offerings, while rethinking position on crafts - Brief Article

DSN Retailing Today, Sept 9, 2002 by Debbie Howell

TROY, MICH.--Making the home look good inside and out is a new strategy Frank's Nursery & Crafts is gambling on to reverse five straight years of declining sales and move ahead after exiting bankruptcy in late May. Ceo Steve Fishman said he wants to find a niche for Frank's that will limit the retailer's liability during peak seasonal sales periods-a liability that currently is very high since lawn and garden accounts for 60% of sales and can be decimated by poor weather patterns.

Home decor, therefore, is a new category thrust for Frank's, an area the retailer only previously dabbled in. Another change will dismantle the bulk of Frank's crafts business, leaving only select items related to home decor crafts.

"We're going to position the company as a convenience nursery home decor and seasonal retailer," Fishman told DSN Retailing Today. "Home decor is a fun business, it's a business consumers are looking for and it's something that is an added value."

Fishman said every category was analyzed at Frank's as part of its reorganization plan. The slow turns in craft items, such as paint and beads, along with the difficulty of competing against crafts specialists with broad assortments prompted Frank's to cut 16,000 SKUs in crafts, or 80 linear feet. That space was redirected to expanded and new home decor categories, such as storage, wall decor, candles, silk arrangements, wicker baskets and decorative accents.

These changes in Frank's mix were implemented Aug. 25 in conjunction with a 50% off home accent sale. The circular included baskets, framed art, silk trees, mirrors, clocks and frames at prices ranging from $4.99 to $99.99.

Changes also are apparent in lawn and garden. Frank's has added better quality and higher price points in live goods and decor, such as a $199 Monrovia topiary and a $199 fairy garden statue.

"The customer who shops us...has the ability to spend more money, which means they will insist upon better-quality goods and some level of service and convenience. That's where we're going to position this company," Fishman said.

As part of the company's indepth analysis, Frank's learned that its typical customer has a household income of $80,000 and is in his or her mid-40s. Therefore, Fishman sees Frank's as positioned midway between home centers that emphasize opening price points and the upscale assortments of independent nurseries.

"We want spectacular value, but we want breadth of assortment and we want quality at the same time," he said.

Three priorities Fishman has outlined for Frank's include developing practices to deliver quality, using a home decor strategy to drive off-peak sales and implementing a long-term growth model that outlines the retailer's niche. The growth model, still in development, will detail specific keys to success for Frank's, such as proper mix, real estate strategy and pricing tactics.

Frank's already has begun working on its quality initiative and has met with live goods vendors to discuss ways of maintaining consistent, high quality in goods.

"It hasn't been a problem, but it hasn't been as consistent as it needs to be," Fishman said. "What I want is the best quality live goods possibly found at the best values, day in and day out."

Marketing also is undergoing a transformation. Frank's implemented an in-store signage campaign in April called Frankly Speaking that raises the bar in customer satisfaction. Of its four components, refunds are permitted up to a year, any live plant can be returned within a year, competitor's prices are matched and certified specialists at Frank's are on hand to answer questions. In the signage, Frank's promises that "we'll do whatever it takes to make you happy"

"If anybody has a problem, you should make good on it when it comes to live goods," said senior vp of merchandising and marketing Kim Homer.

Frank's also is actively promoting live goods on sale, something the retailer hadn't done before. Homer said Frank's is stressing curb appeal by making sure colorful live goods are an attention-grabber at stores.

Along with the new merchandising and marketing strategies, Frank's also is experimenting with a different layout. A test store in Sterling Heights, Mich., is the first of eight remodeled stores to show off the new home decor items and was toured by DSN Retailing Today Aug. 26, shortly after the remodel had been completed.

Compared with a typical Frank's that features goods merchandised primarily on gondolas, the new store format is a dramatic change. Fifty-one 4-foot gondola sections were removed and replaced with merchandise stacked either on low-rising display tables or pallets at the front and center of the store.

Immediately to the right and center of the store upon entering were eight sections of tiered tables with decor items ranging from clocks to decorative glass-and-metal plant stands. Along the right wall was a broad array of candles, while gondolas featuring framed art, mirrors and frames were in the right back corner.

At the center front of the store was another open area featuring mostly pallet-dropped displays of promotional decor items, such as plastic tote bins, wooden baskets and framed art. Directly behind was another open area devoted to large garden accents, such as arches, fountains and small accent tables.