Zayre comes back to life; poised to be urban force - Ames Department Stores Inc. retains the Zayre name at some urban locations

Discount Store News, Nov 13, 1989 by Peter Hisey

Zayre Comes Back to Life; Poised to Be Urban Force

ROCKY HILL, Conn. - Like the fabled Phoenix, the venerable Zayre chain died in late October, then rose from its own ashes.

On Oct. 26, 254 Zayre stores changed their name to Ames, but a new $700 million Zayre chain, based on 61 high-volume urban Zayre stores, was born. And in the future, it may become a significant growth area for parent Ames Department Stores.

According to Steve Jelin, the Ames senior vice president who heads the Urban Zayre Division, Zayre will be run as a separate merchandising organization, with vertical buying, merchandising, advertising and distribution functions run by Zayre, while Ames supplies store operations, personnel, warehousing and technological systems.

And no two stores will be identical. "With 61 stores, we can look at each, market by market," he said. "Urban customers have very individual tastes, and with a chain this size, we can cater to them." Zayre's markets include Miami, Washington, D.C., Chicago, and Cleveland, which contain minority groups including Mexican, Cuban, Puerto Rican, Haitian, American Black, Jamaican, Korean, Chinese, and several others. "All have very individual tastes and needs," Jelin said.

The most immediately visible difference at Zayre stores chainwide will be a greater emphasis on apparel. According to Ames president and ceo Peter Hollis, soft lines will account for 60 percent or more of the product mix in the future. Areas that will give up ground for this increase: paint, hardware, lawn & garden, sporting goods and other hard lines areas of lesser importance to urban dwellers.

"Urban customers have very different priorities," said Jelin. "They don't need $300 gas grills and patio sets and they don't want country geese on their sheets and comforters. We'll merchandise to suit their needs and tastes."

Another major change will be a new prototype, the first of which (a retrofit) will debut on Nov. 19, with the first ground-up example due in Cleveland next fall. The new format will feature more and wider aisles, allowing more bargain tables and better access, Jelin said. Also, customers will see a new approach to color, which Jelin called "a joyous and colorful" feeling.

The new Zayre will also feature a customer convenience center at the front of each store, offering services such as check-cashing, bill-paying, wire transfer and other services that will make Zayres destination stores. The prototype will also feature new fixturing, focal walls, customized snack areas featuring ethnic favorites and much more.

In effect, this will create a new chain, somewhat like the old Zayre, a bit like Ames, and also something new, Jelin said. "We're trying to fill a niche no one else is addressing," he said. "Despite the difficulties of operating in an urban environment, the urban consumer is very loyal if you market to her needs."

That attention to varying audiences will require an attention to detail uncommon in discount stores. "That's one advantage of a 61-store chain," Jelin noted. "We can be flexible - if the customer base in a store is largely Jamaican, we'll play reggae music. And the same will hold for brands, colors, sizes, fashions and so on."

This means, to an extent, a learning experience. Jelin joined Zayre nearly four years ago, so he knows the stores, and he plans to listen to store employees, who come from each unit's market. "They know what people in that area want," he said.

And, as the existing stores are retrofitted (27 of them will be redesigned next year), Zayre hopes to look at expansion into markets like New York, Los Angeles and Philadelphia. At roughly $700 million in sales last year, which would put the chain in the top 20 of discount department stores, Zayre is

already a sizeable chain. Expansion into urban markets virtually abandoned by other discounters since the late 1970s could make it significantly larger.

Hollis, who also knows these stores from his years as a Zayre executive before moving on to Ames, is enthusiastic about the "new" chain's prospects.

"That was one advantage of the acquisition; it stepped up our bench strength so that we had top professionals available for these positions," Hollis noted. "The division will be a very large chain in itself; these were and are very productive stores, and at 60,000 to 75,000 square feet, large ones as well."

Jelin concurs. "Some of these stores account for $20 to $25 million in sales each," he said. "A friend mentioned that if a store is doing $25 million, maybe we shouldn't fix it, but we think that remerchandising them will make them more productive than ever."

The Zayre stores will cut circulars from 45 a year to 37 this year (with more cuts possible). Radio and TV advertising will be stepped up, and will emphasize brand names. "Urban consumers are very brand-conscious, but sometimes they're after different brands," Jelin said.

With that in mind, Jelin's staff of buyers have located most-wanted brand names, and most-wanted models. Where most discounters covet denim brands like Levi's, Lee and Wrangler, Zayre's customers prefer Chic, Sergio Valente, Jordache and Sasson, for instance.