Venture keeps chin up; critics hold breath

Discount Store News, Dec 8, 1997 by Laura Heller

O'FALLON, MO. -- Venture isn't calling it quits -- yet. As the regional enters what should be the most profitable of seasons, it funds itself once again facing rumors of an imminent demise.

Although much of the talk surrounding Venture is speculation, one thing is ceratin: The chain needs a bit more than a strong holiday selling season to keep it going into next year.

But Venture isn't throwing in the towel yet. Although the chain reported third quarter losses of more than $26 million for the 13 weeks ended Oct. 25, ceo Bob Wildrick cited positive trends in soft lines and selected hard lines as indicators of a successful turnaround attempt. "Venture is entering the holiday sales season in its best position in more than two years," he said in a statement.

Wildrick has always maintained that Venture will never declare bankruptcy. But as the chain runs through its financial resources analysts are speculating on just how much longer it can stay afloat.

Several retail chains, including ShopKo, Kohl's and Kmart, are said to be waiting in the wings to buy off stores should a liquidation occur. Last August, Venture sold interests in 49 properties to New Hyde Park, N.Y.-based Kimco Realty Corp., raising about $135 million to secure its credit needs for the fall/holiday season. The deal also gave Kimco, which brockered the sale of both Clover and Gold Circle chains' remaining stores, rights of first refusal on virtually all of Venture's other properties.

According to one industry source, Venture's Chicago-area stores will likely be picked up by Kmart, which purchased 20 Venture store earlier this summer. Kohl's may be interested in the St. Louis locations. ShopKo is said to be interested in cherry-picking a few stores, presumably in locations contiguous with the Jack's chain it recently acquired from Penn-Daniels.

Venture has struggled for more than two years to revamp its stores and turn heavy financial losses into gains. By most accounts, it has made a valiant effort and analysts voice respect for the chain's new look and bold efforts. But as the year comes to a close, some are wondering how much longer the company can last.

SEveral moves earlier this year gave Venture a much-needed respite from financial pressure. In July, the chain established a more flexible line of credit with a bank syndicate that gave the chain greater borrowing power.

But now, according to one source, "they're run out of assets."

A factor who deals with the chain was a bit more optimistic about Venture's future but believes the company needs something more dramatic than one good holiday season to keep it going. The chain may financially last into the first few month of 1998, but vendors are showing caution, said the factor.

According to Jim rice of Bernard Sands Credit Corp., "People are starting to pull back a little now and take a wait-and-see approach."

In the meantime, Venture keeps plugging along. It recently announced changes in the children's department as it moves into the final phase of repositioning. Enhancements include dress business in all sizes from newborn to sizes 7 through 16; an expanded Stone Mesa program; and more everyday value pricing with strong opening price points.

A new "KidVenture Care-antee" program allows customers to return children's clothing within 90 days for an exchange or refund with a valid receipt. The program was introduced during the Back-to-School season and will be heavily promoted through in-store signage and advertising.

Venture also is stepping up its advertising for all departments through the end of the year.