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Anna's Linens picks up the pace

LAS VEGAS — The recent opening of Anna's Linens in Las Vegas marked the company's third market entry in three years — a pace the company will kick up next year by entering two new major markets.

Retail consolidation and the softening economy have been good for the value-oriented home textiles chain, which targets budget-to-moderate consumers, particularly in blue-collar and ethnic neighborhoods. Foot traffic is up 20 percent. Comps are up by double-digits on top of double-digit increases last year. The company has expanded existing categories, added new ones and squeezed out a 10 percent improvement on in-stocks during the year, according to Alan Gladstone, president of the Santa Ana, CA-based chain.

"We don't try to take care of the world," Gladstone told HTT. "We're not looking to trade up the customer. We're looking to constantly trade up better value. The demise of so many competitors, conversely, has propelled our business."

Operationally, the closing of Strouds and Wards units in Anna's markets brought a pool of new management personnel to the privately held chain. Those and other store closings also enriched Anna's offerings in opportunistic buys, which account for 25 percent of the assortment, Gladstone said.

"We bought a tremendous amount of goods from Wards in all categories, especially in the window covering business. HomePlace the same thing. And we made some purchases that Strouds couldn't take," he said.

The uncertain consumer climate that forced others out of business has also driven more moderate-level shoppers into Anna's stores, Gladstone said.

The company has not stepped up promotions to help drive traffic. Instead, Gladstone said, Anna's has added peripheral goods such as frameable art and impulse items such as soaps.

In addition, Anna's has created a cross-merchandised juvenile business, including juvenile rugs, place mats, children's dinnerware and glassware.

"So many of our customers have children, and many of them have several children," Gladstone said.

Juvenile bedding, however, has not been expanded. Anna's customer buys licensed juvenile, and "there's no one pattern that's replaced Pokemon yet," Gladstone said.

Other merchandising changes over the year included the addition of 5' x 8' and 6' x 9' area rugs in bigger stores — Anna's first hanging program for floor. The program also gave the chain a new upper price point. Although everyday prices range from $100 to $150 on 6'x 9', on special values they run up to $300.

"The response was immediate," Gladstone said. "Even in the new [Las Vegas] store they were selling on the first day."

The arrival of the moderate shopper also allows Anna's to move its upper price point on bed in the bag and comforter sets from $69.99 to $99.99.

"It didn't phase anyone. They recognized the value," Gladstone said. "The customer is looking for steak cheap, not cheap steak."

Anna's is taking that formula to 14 more locations this year, five of which have already opened. The 62-unit chain will add three stores in Louisiana, which it entered last year, and three in Texas, where it has been in business for two years. Two more units will open in Las Vegas by yearend, with another coming on line in the spring.

"We should end the year with around 72 stores and next year should get close to 90," Gladstone said. "Fifty percent will be new markets."

At 15,000 square feet, the Las Vegas unit is the company's largest, although it was the shopping center location rather than the square footage that attracted the retailer.

Some 150 vendors attended the opening, including executives from Veratex, Springs, Creative Bath, S. Lichtenburg, Brentwood, Catalina, Dan River, Pillowtex, Tex-Style and Burlington.

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