NEW YORK -- Hard times aren't holding back Bloomingdale's.
In its biggest expansion year ever, Bloomingdale's is opening stores in Bridgewater Commons and Willowbrook Mall in New Jersey in April, and in Orlando, Las Vegas and Chicago in November. The openings will raise the chain's national store count to 28, and should enable Bloomingdale's to break the $2 billion barrier within two years.
Market sources say Bloomingdale's in 2001 posted about $1.75 billion in sales, with 23 locations.
In 1996, Bloomingdale's, a division of Federated Department Stores, entered California in four locations within two weeks, the biggest expansion to date. While this year's expansion will yield five locations, it remains to be seen whether it will add more revenues than the California openings.
In terms of profitability, Bloomingdale's last year reportedly fell in the middle of the Federated pact, and was hampered by the decline in tourism, the recession and the impact of Sept. 11. Earnings before interest and taxes profits have ranged from a low of 5 percent 10 years ago, to a high of 11 percent in 2000. Federated also operates Burdines, Lazarus/Rich's, The Bon Marche, Macy's East, Macy's West and Fingerhut.
Bloomingdale's latest expansion tightens the chain's grip on the New York metro area, its most important market, and advances its fledgling freestanding home store concept. The Vegas and Chicago units will be home stores. Bloomingdale's only other home stores are in Chestnut Hill, Mass., and Newport, Calif.
In New Jersey, Bloomingdale's is converting two former Stern's units. Federated announced its decision to shut down Stern's in February 2001 and convert most of the units to Macy's, and two to Bloomingdale's.
It will be a brutal battle for market share, since New Jersey is among the nation's most overstored states, overrun by megamalls, outlet centers and discount centers, and the ubiquitous Macy's and Lord & Taylor. More recently, Nordstrom, Old Navy, Kohl's, Target and Hennes & Mauritz have infiltrated the state.
Nevertheless, Bloomingdale's, which currently operates two branches in New Jersey, at Riverside Square in Hackensack, and the Mall at Short Hills, contends it can break through the sea of merchandise sameness. According to market sources, Bloomingdale's hopes to double in three years its New Jersey volume, which is currently around $160 million.
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