Montgomery Ward launches 'home' stores

Discount Store News, Jan 3, 1994

CHICAGO - Montgomery Ward plans to open home stores that combine its Electric Avenue and Rooms and More departments as its expansion vehicle for smaller markets.

The move is part of a restructuring that also saw president and senior merchant Harold Kahn leave the retailer in expectation of management changes. No replacement was named, but the position is expected to be filled, a spokeswoman said.

Chairman and ceo Bernard F. Brennan said the "realignment will allow each of our strategic business channels to grow independently." The changes "will be detailed further in the near future."

The announcements came as the privately held company's parent, Montgomery Ward Holding Corp., reported to the SEC that revenues in the quarter ended Oct. 2 rose 6% to $1.41 billion from $1.33 billion, while net income increased 17% to $14 million from $12 million.

As for the planned realignment, how the business will shape up isn't yet known, the spokeswoman added. The president job "is on the table now" and future responsibilities are open.

Besides its realignment, the retailer, as part of its future growth, is "looking at a number of opportunities" in the interactive shopping field and expected to make an announcement early this year, the spokeswoman said.

The retailer hasn't picked a name for its specialty stores, but Montgomery Ward will be part of the name and so will "Home" the spokeswoman said.

The retailer targeted the specialty stores for mid-sized markets where they can "assume leadership position" by concentrating on the company's success with Electric Avenue and Rooms and More, she said.

In mid-sized markets, she said, people are focusing on their homes more. The retailer defines mid-sized markets as communities beyond the 20 to 30 major cities.

The specialty stores will carry goods now found in Electric Avenue and Rooms and More sections, with added brands and more depth.

The new store will offer all things for the home, including housewares, soft home and room accessories like lamps and carpets.

The retailer projects 50 to 60 specialty stores. While there are no plans to open stores in major markets, that could change

Electric Avenues now are in just over half of all Ward stores and Rooms and More are in just under half of all units. The two sections together take up about 40,000 sq. ft. to 45,000 sq. ft.

The first specialty stores will open in La Crosse, Wis., and Owensboro, Ky.

The retailer will open 10 stores this year, nine new units, and one in St. Paul, Minn., which will replace a unit opened in 1921. The new stores will opened in the time period between August through October. Ashville, N.C., is the only other market set for a store.