Big Lots looking for merchants, reworking assortment
August 30, 2013,
Columbus, Ohio - Big Lots is in the market for gmms as well as planning and allocations people as it works to implement a new merchandising strategy with an eye toward a spring 2014 rollout.
New ceo David Campisi, who joined the company in early May, told investors during this morning's quarterly conference call that merchandise assortments are inconsistent across the store. The company also devotes too much space to items that are not destination categories. Jewelry and watches, for example, might be better stocked only for certain seasonal events, he said.
The mantra going forward: Edit to Amplify. Cut back on categories that are less meaningful to the core customer and reallocate the space to categories that are.
In soft home, that means a shift from in-and-out fashion - especially in bedding - to consistent in-stocks on everyday basics. Campisi also mentioned Big Lots' kitchen textiles assortment, which he said relies too heavily on closeouts. He wants to improve both the quality and the taste level in the category.
Campisi plans to do more cross-merchandising in home, especially involving furniture - a strong category for Big Lots - and frames.
Overall, he seemed to indicate a shift toward a more considered approach to buying, one not as driven by chasing opportunistic inventory.
"We're really very lean both in buyers and planning and allocations," he said. "We need to get more eyes on the details. There are too many misses that have taken place."
Big Lots is not, he emphasized, abandoning the close-out business.
The strategy is being crafted to appeal to "Jennifer," the company's core customer. Her average age is 42 and her average household income is $54,000. Among the core shopper group, 56% are married and 51% have children at home.
"A lot of the things I'm talking about are happening as we speak," Campisi told analysts. "We're [already] making significant changes in how we present merchandise to Jennifer."
For the second quarter, ended Aug. 3, total company income from continuing operations was $18.1 million, which included a one-time tax benefit of $400,000. Consolidated income from continuing operations for the second quarter of fiscal 2012 was $22.1 million.
Consolidated company sales ticked up 0.6% to $1.2 billion. Comps fell 1.9%, slightly outpacing Big Lots' guidance for a decrease of 2% to 4%.
Sales for U.S. operations increased 0.4% to $1,187.7 million, with comps down 2.2%. Sales for the company's Canadian stores rose 8.2% to $37.9 million, with comps up 8.3%.
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