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Kohl's goes Southwest with expansion plans

Andrea Lillo, Staff Staff -- Home Textiles Today, March 19, 2001

MENOMONEE FALLS, WI -Days after Kohl's opened 15 stores in its new market of Atlanta, the company announced the expansion into the Southwest in 2003, taking Kohl's to the national level.

"It will be our biggest endeavor since our Tri-State opening," when 35 stores opened, said Larry Montgomery, ceo. "It's very exciting."

In the Spring of 2003, a "critical mass" of stores in the Los Angeles area will debut, though he declined to be specific. Kohl's will also break into Nevada and Arizona.

The retailer is looking to build prototype buildings, he added, but there will probably be one or two locations in existing buildings. A distribution center is also an "obvious" part of the plan, and will be able to service about 100 stores.

"We've been researching the market out there for a couple of years," Montgomery said.

He added that people have asked him if former Wards locations are desirable to Kohl's, and his response is: "They don't meet our criteria." The Wards stores are 50 percent bigger than the average Kohl's, which is about 87,000 square feet, and they are usually located in regional malls, while Kohl's prefers to be where its customer lives for convenience, he said. Kohl's also prefers to build its locations from the ground up, whenever possible.

For 2002, Kohl's plans to open 70 stores, including the 15 former Bradlees locations it purchased in the Boston area, another new market, as well as attaining "critical mass" in Houston.

Meanwhile, next month the company will open four stores in the Hartford, CT, area and three stores in Arkansas, another new entry, as well as 12 additional stores in existing markets.

This fall, Kohl's will already add three more stores in the Atlanta market, as well as four stores in the new market of Oklahoma City and, continuing its expansion in Texas, three more in Austin and two in El Paso, as well as 14 locations in existing markets.

According to the company, the recent Atlanta openings were among the smoothest Kohl's has ever had.

"It's another great market for us," Kevin Mansell, president, told HTT. "Our history is to come in with a lot of stores, to convenience the customer with a lot of locations. We try to own that customer." The plethora of locations also helps in an area like Atlanta where the traffic is a problem.

All of the new Atlanta stores debuted the fresh layout of the home department, which is now presented as one continual visual look, instead of divided between housewares and tabletop, and domestics. Each area is set off by an oak armoire look on the wall that highlights the product area, like bed or bath. "It creates a focal point," said Jack Moore, executive vp, gmm, home. "It's a common thread."

The home decor area, which includes rugs, candles, framed art and decorative pillows, has above average growth, he added, and has been pulled into a central area.

The other product areas included kitchen textiles and table linens, which had a large Easter assortment, bedding, including bed-in-a-bags, blankets and comforters, and bath, with many bath rugs and towels. Most of the product is displayed from light colors to darks.

Kohl's private-label brand, about 20 percent of the merchandise, included a 230-count cotton sateen sheet on sale for $29.99 for a queen flat. Fieldcrest's 250 Supreme Touch sheets were also on display, in compact packaging that was half the size of an average sheet package. Juvenile bedding and jersey sheets were included.

Towel choices were plentiful and included Kohl's ribbed solid bath towel, 36" x 72" on sale from $12.72 to $18.99. Fieldcrest bath towels on the back wall were on sale, including a 27" x 52" bath towel, on sale from $5.99 to $9.99. Fieldcrest's Pima cotton bath towel, at 30" x 54", was on sale from $9.99 to $14.99.

The new home store will be in all of the new stores as well as every remodeled one. Each store is remodeled about every seven to eight years, Mansell said, and 30 to 40 locations were scheduled for major or minor renovations this year.

Mansell mentioned that a Wisconsin customer visiting the new Atlanta store told him that the new store looked exactly the same as the one near her home, and that's what Kohl's strives for. Consistency is key, Mansell said, and Kohl's is all about accessibility of merchandise to customers. "You can be in any part of the store and still touch and reach any department."

In-stocks are a crucial part of that. "We are a destination store," said Moore. "If the customer can't find what she's looking for, odds are she won't come back." He said that in-stocks were at a high percentage, though he declined to be more specific.

Half of the management team for a new store was brought in from another Kohl's location, Mansell said, since they are familiar with the Kohl's culture. A typical Kohl's store has a store manager, three assistant managers and 150 to 180 sales associates.

Chris Candee, vp, dmm, said that though all areas of the home department are watched carefully, two areas of growth include printed rugs, which are "all about the print and color," and "the acceleration of apparel fashion into home fashions, like animal."