Bracing up Bradlees - AM: Special Supplement - Cover Story

Discount Store News, March 4, 1991 by Jeffrey Arlen

BRACING UP BRADLEES

* It was once considered the cutting-edge mass merchant. The premier regional chain. The hybrid volume retailer that combined a staff schooled in the merchandising strategies of the old Federated Department Store Co. with the efficiencies associated with discounting.

But the bubble burst. The firm got caught in a not-uncommon retailing foible. It made the same mistake JCPenney initially made when it embarked on its corporate mission to become a national department store chain. Bradlees succeeded in becoming an "upscale discounter," but it traded up too fast, alienating a consumer base that felt the beautifully merchandised and assorted store wasn't necessarily worth the price of admission.

A leveraged buyout at parent Stop & Shop Companies in early 1988, the resulting sale of Bradlees' southern stores, and a management shuffle at both the corporate and divisional levels did little to bolster Bradlees, at least in the short term. Sales for 1989 dropped to $1.7 billion, according to market sources, which represents a 19% decrease in revenue compared to the prior year.

The dust has begun to settle, however. The operation remains driven by its apparel division, which represents between 40% and 50% of sales, but fashion is wisely tempered by price and end use.

"The main challenge," says Cecilia Swartz, who was named vice president, general merchandise manager--the 130-store chain's top apparel job--about eight months ago "is to continue to identify the needs of the customers and serve them in terms of finding the right mix of brands, private label, fashion, and price points."

While assortments at the store are quite broad from both a fashion and price perspective, Swartz's statement doesn't imply that her job is to attempt to make Bradlees everything to everybody. In fact, Swartz makes a point of primarily merchandising to the customer who most frequently walks through Bradlees' doors.

"In one sense, a Bradlees customer can be almost any resident in a particular trading area. But the core customer is a working or non-working mother," Swartz explains. This perspective shades a good number of merchandising decisions.

The juniors department, for example, isn't aimed at the very young and very trendy. Says Swartz, "We are definitely not going after the bubble gum junior. I see our juniors business as being aimed at the young contemporary person."

Why? "We have a very strong, true missy customer in most areas, but we also get younger, more-updated women in the stores. If we targeted the bubble gum customer, we'd have to miss a large segment of the population that is in the middle, and I'd much rather address her than try and get the youngsters into the store.

"I think that bubble gum customer is always more likely to shop in a department store or a specialty store. They want the latest brand names and are mall oriented, responding to peer pressure and all of that. It's very tough to get that customer. At one time I thought we might be able to, because we have a very strong 7-to-14 business, but to bring that customer up is very difficult. We're better off going after the young contemporary woman."

Given the strength of Bradlees' misses business, it is not surprising that despite a casual orientation storewide, Swartz devotes significant floor space to dressier women's wear aimed at mature customers and career women. The foundation of this department, which many other discounters have scaled down or eliminated to bolster casual assortments, is based on separates from Cape Cod, a moderately priced sportswear label that has national distribution.

While brands play a dominant position in career wear at Bradlees, their influence varies by classification. As might be expected, the jeans areas in women's wear, which generates 50% of apparel sales; men's wear, which produces 25% of apparel revenue; and children's apparel, bringing in the remaining quarter of the business, are dominated by well-known labels. In fact, a customer shopping for denim at Bradlees would have a broad array from which to choose. The store carries everything from opening-price men's Russler models, recently promoted at $11.99 to $19.99, to Freezewash models from Lee, and Brittania merchandise with $24.99 price tags.

Yet private-label merchandise has always been prevalent throughout the Bradlees stores, and Swartz has no intention of shifting her position in that regard.

"Brands are never going to serve all of our needs. Basic commodity areas are where we go after the brands. We use our private label to fill in what we see as a fashion void. That way we can distinguish ourselves from the competition. We use private label to layer on more stylish, better goods.

"I think most mass merchants approach private label that way, unlike department stores, which more often than not shore up opening price points with private label," Swartz maintains.

Price undoubtedly also plays a large part in addressing fashion through private label. Despite U.S. manufacturing strides in recent years, it is generally still far more cost effective to produce intricately styled clothing abroad because of savings on labor.