It's Going to be a Bumpy Ride
January 2, 2006,
Moving into the New Year, there's a whole bunch of questions — new and old — that need to be resolved.
Let's look at retailing. There are the obvious ones. Like the Federated challenge in developing a viable Macy's Home Store at the same time that is attempting to absorb the May Co. business and juggling what is to be with Marshall Field's and Lord & Taylor.
Moving along this path of questions is what will be with Linens'n Things. Last week's announcement that it has met the financial hurdles needed toward its acquisition by Apollo opens the conversation to who will be running the show — and what major or minor changes are afoot now that it will be a private entity, able to move without microscopic scrutiny and comparisons with Bed Bath & Beyond.
And almost as if it had dropped off the face of the earth is ShopKo, now also a private entity, but one infrequently mentioned among retailing or home textiles pundits.
And as if reality is stranger than make-believe, we have the situation where the northern division of the former Saks Department Store Group will lead the merchandising and marketing efforts of its acquirer — Bon Ton Stores. There's a whole bunch of folks down south who had been the kingpins of the SDSG merchandise team who are waiting to figure out what's going to happen when the deal closes. Not to mention the Bon-Ton merchants who face similar challenges.
Industry Goliath Wal-Mart continues to try to bring its image up as well as its merchandise. At the same time it cannot abandon its core customer base more concentrated on price versus trade up or trendy fashion.
Lurking behind all this is the Internet. Suppliers, as well as their retailer customers, are identifying this as what it is: a burgeoning selling arena for products and services, direct from the source or via retail intermediaries. It's happening, big time already. This year should be even more intense.