As change stirs retail waters, new waves emerge - Between the Lines - Column

Discount Store News, April 15, 1996 by Jennifer Negley

Desperate times call for desperate measures, and when I get stuck for an idea, I turn to the writer's favorite crutch: "Barlett's Familiar Quotations." It's a great place to stumble across ideas, and today the idealist I tripped over was 19th century German playwright and poet Johann Christoph Friedrich von Schiller. (I hope no one ever has to fit him onto a postage stamp.)

This is the Schiller line that caught my attention: "What's old collapses, times change, and new life blossoms in the ruins."

You could argue that it takes a peculiar twist of thought to connect a 192-year-old aphorism to the state of retailing on the cusp of the 21st century. But if you had just finished reading through all the news stories in this edition of Discount Store News, as I had, "new life blossoms in the ruins" might strike your eye, too.

The old order has collapsed. In the last six months, retailers have closed the shutters on more than 800 U.S. storefronts, some have gone out of business altogether and many manufacturers made the tough decision to trust that Kmart's new team will find its bearings.

How greatly are the times changing? Bill Fields bids farewell to Wal-Mart after 25 years. Michael's craft chain, reeling from a dizzying cycle of expansion, sells a big chunk of stock to chairman Sam Wyly's family, giving them control of more than 20% of the company. Mighty Melville is rapidly melting away, and its corporate identity as a diversified umbrella company will vanish before the year is out.

But new life is blossoming.

Consolidated's acquisition of Kay-Bee will make it the leading close-out toy chain operator. With some 1,160 stores after the deal goes through, Consolidated is going to wield a significantly bigger pencil.

Kmart's "Retail Store of the Future" project - being developed in conjunction with a consortium that includes 3M, Digital Equipment Corp., Hewlett-Packard, Hughes Electronics, IBM, NCR and Texas Instruments - will bring a wave of electronic goodies to stores when it enters the test phase. Look for smart cards, electronic coupons and more aggressive customer-specific database marketing.

A quick aside about Kmart. Associate editor Teresa Andreoli, desk editor Tim Healea and I checked out a Kmart store in Garden City, N.Y, one morning not long ago. There were more associates bustling around the floor cleaning fixtures and stocking shelves than you could shake a stick at - and so many gave us a cheery "good morning!" I started to feel like I was walking around with a fifty dollar bill pasted to my forehead. More proof that the times they are a-changin.'

New life is even blossoming where there aren't ruins. WalMart's decision to test store-specific merchandising may look like a footnote now, but I suspect it's Bentonville's latest big idea. It springs from initiatives undertaken in the Hometown Stores division under Dave Jackson, divisional vice president. Keep your eve on that guy; he's an up and comer.

Which brings us back to the subject of change. When I flipped open Barlett's for this column, I was looking for a specific passage. I couldn't find it and don't remember who said it, but it goes something like this: Change is the best evidence we have that we still exist.