By  on February 6, 2006

NEW YORK - Sears Holdings Corp. is opening a design office here around mid-March as part of a drive to increase the margins and appeal of its private label apparel and accessories, lower costs and attract talent.

The Sears division specifically wants to bridge the gap between its hard and soft goods, and encourage cross-shopping. Some proprietary brands are being introduced, some are being dropped, and femininity and details are being injected into third- and fourth-quarter collections for the Apostrophe, Covington and Classic Elements in-house apparel brands, among others.

The Canyon River Blues name is returning this fall after being sold as CRB and losing some recognition. Toughskins, a former Sears brand, is being revived for kids aged two to seven by next holiday. Belongings, a Liz Claiborne-supplied brand, will be gone after the spring, as will Parallel, another in-house brand. Craftsman stain-resistant workwear for men was introduced last fall, and prototype Lands' End shops, some that house all categories together, are being tested in a handful of locations, including units in White Plains and Yonkers, N.Y.

The strategy is led by Lisa Schultz, executive vice president of Sears Holdings Apparel Design. She oversees all Sears and Kmart apparel design teams, which are being integrated at the new office at 75 Varick Street in SoHo. "I am interested in adding new brands," she said in an interview. "I would like to see more activewear, which could include Lands' End. As you know, Sears sells a lot of treadmills....And in dresses and special sizes, things are in the works.

"By the end of the year, you will see a different way of merchandising, a different way of flowing goods and less confusion" on the selling floors. "There will be longer periods in between changes so stores can execute more clearly and the shopping experience is easier."

She acknowledged there had been too much clutter on the selling floors, and that the company was "running lots of tests and experiments" with Lands' End and other programs. Last quarter, apparel sales dragged at Sears, but posted comp gains at Kmart, the sister division at Sears Holdings.

Even though the stores dropped Belongings, Schultz said there was still a "strong partnership with Liz Claiborne" through Claiborne's First Issue brand, sold exclusively at Sears, as well as with Jones Apparel Group, which supplies the Rena Rowan line to Sears. "We are focusing on those brands that have a history and are recognized by our customers."

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