Waldenbooks takes over K mart books

Discount Store News, July 7, 1986

Waldenbooks Takes Over K mart Books

STAMFORD, Conn. -- Over the next five years, K mart will turn its book departments over to its Waldenbooks division.

When size allows, Waldenbooks will lease the department from the discounter and turn the area into a Reader's Market, the same nameplate as its small discount book store division. In very small K mart book departments, Waldenbooks will just service and stock the area.

The first leased Reader's Market departments were launched in six Connecticut and Massachusetts K mart stores last month. In addition, Waldenbooks is servicing seven New Jersey K mart book departments. That initial test of the program was begun last March.

"We're working on an agreement with K mart as far as paying them for the [leased] space, but certainly we feel that the overall operations of the store can be more economical than if we were to open a 3,000- to 4,000-sq.-ft. store in a strip center," said Harry Hoffman, Waldenbooks president and chief executive officer. He declined to detail the lease arrangements.

"K mart stores have the traffic that would be important to support the [Reader's Market] stores. K mart does a pretty big book business today. With better systems, we can increase at least two or three times what they normally do," he said.

In addition to store size, The Reader's Market (RM) format will be moved into territories that have the right demographics to support the program, said Hoffman, although this is a secondary concern.

The department walls will match the rest of the store, with books stocked on oak fixtures. Signing will be in the discount book chains's teal and pumpkin color scheme and will clearly identify the area as Reader's Market.

In smaller stores, the book areas will continue as K mart departments but will be operated by Waldenbooks as in the New Jersey test stores, he said. All stores will offer hard cover best sellers.

RM's "store within a store" arrangement was designed to combat stiff book market competition on two fronts: from discounters such as Barnes & Noble and crown Books, and from full-price retailers like its own parent company and rival B. Dalton Booksellers. These last two have turned to price cutting programs in the past year to compete with the discounters.

B. Dalton's strength in its discounting strategies has contributed to the downfall of its own 37-unit discount book store division, Pickwick Discount Books. B. Dalton, a division of Dayton Hudson, recently announced it would close the unprofitable Pickwick chain and convert 17 of the stores to B. Dalton outlets.

The new RM departments occupy about 1,200 sq. ft. in K mart's Southington, Manchester and Cromwell, Conn., stores and in units in Hyannisport, Brockton and Milford, Mass.

In addition to the leased departments, the company operates freestanding RM units in Port Chester, Mamaroneck, Cedarhurst and Manhasset, N.Y., and in Norwalk, Conn. Expansion of these units is on hold as Waldenbooks pursues the K mart in-store programs and the rollout of its Waldenbooks & More concept.

(Waldenbooks & More is a 10,000-sq.-ft. store in Levittown, N.Y., which in addition to books features games, video cassettes, stationery and greeting cards, among other categories. The chain expects to open five to 10 more of these stores by year's end.)

The new, leased departments were given space in the front corner of the stores, near health & beauty aids, to take advantage of wall space, said Charles Cumello, executive vice president and chief financial officer of Waldenbooks and head of the K mart book program.

In other K mart stores, the book department takes up approximately 600 to 800 sq. ft.

The RM departments expand K mart's traditional offering of 1,000 to 1,500 titles of mostly paperbacks in the $2.95 to $3.95 price range to about 2,500 titles, including paperbacks, hard cover and trade paper, said Cumello.

"In the old K mart book department, it was a very limited selection of product--basically very heavy in the mass market areas. What we have done is represent every category of books and put the best titles of each category into the store," he said.

Categories like self-help (health and fitness), reference and cooking have been added or expanded, he said. K mart will continue to supply its own bargain books and some of its children's book assortment.