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Wandering Eyes

Over the past several months, a new retailing trend seems to be emerging. And it's one that flies in the face of any basics in Retailing 101.

The trend seems to be three-fold ... take your eye off your basic business, move to something different, and copy your competition with a “new concept” — one that they spent time and money to develop to their particular needs and strategic specifications.

Looking at the first part of the this new trend triumvirate — basic business — the outcome would more than likely spell trouble. Any retailer that ignores what brought it to the dance is destined to have greater problems as it moves into untried territories.

In recent years, we've seen a number of major retailers moving away from their core home textiles business into uncharted waters. What happens is that management attention is focused on the new business and less and less attention is paid to the critical core. Any reason to wonder why many of these core businesses continue in a downward spiral?

And then there is the challenge: get the new business area to perform up to plan, an especially vexing challenge if store traffic slumps and promotional activity declines.

We've seen it in department stores, specialty stores and even consumer-direct businesses. Lamps and small appliances and electronics now are creeping back into assortments that for several decades banned them. The question: who today in those companies knows the nuances of what is needed to field successful businesses in these products? The second question: do they have the infrastructure to support their particular needs?

The third piece is more intriguing, brought to the forefront when Restoration Hardware's Gary Friedman, the CEO and ex-president of Williams-Sonoma, announced a direct-to-consumer business that is being patterned after the Williams-Sonoma West Elm business.

Yes, many full-line and specialty home furnishings retailers are increasingly discovering the direct-to-consumer route, especially through the Internet. But again the issue is whether they have the ability to service the business as they move from their core.

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