JAN STUART'S ALTERNATIVE: NATURE'S ELEMENTS

Byline: Faye Brookman

NEW YORK--Just a few doors down from a Body Shop store and a block up from a Ricky's drugstore, Jan Stuart unveiled his latest Nature's Elements branch in Greenwich Village Monday, on Broadway near Eighth Street.
It is appropriate that Stuart's new 1,000-square-foot store is sandwiched between a specialty shop and a drugstore. That's because it is exactly the positioning Stuart, president of the Edgewater, N.J.-based company, has taken with the Nature's Elements concept.
Stuart said his customers aren't paying for "packaging and hype" the way they might in a department store. Yet he isn't selling "mass market products like a CVS," he added, referring to the Woonsocket, R.I.-based drugstore chain. "We offer service, quality and value."
More than 160 shoppers visited the store during its grand opening. It is the third Nature's Elements in Manhattan.
There are 30 Nature's Elements units, mostly in major malls on the East Coast. Although Stuart will not reveal opening sales figures, he estimated attendance was 33 percent higher than he expected. Based on opening-day results and the high-traffic location, he said he believes the store will be the highest producer in the chain.
Industry experts estimate the store can achieve sales exceeding $1 million. The nearby Body Shop is reported to produce an annual volume of $1.7 million. A Body Shop spokeswoman declined comment on that.
The store features 800 Nature's Elements private label products, including body and bath, skin care, hair care, cosmetics, sun care, aromatherapy, fragrances, Mommy & Me children's items and Men's Club men's products. Prices range from $2.50 for a 4-oz. glycerin soap to $16 for an 8-oz. Peppermint Foot Lotion.
Stuart's strategy in cosmetics is to build the skin care business first, in an effort to develop repeat customers who might subsequently try color cosmetics. Sources estimate that color cosmetics generate 12 percent of the chain's sales.
"We sold a lot of our skin care products during the opening," said Stuart, "and that's important because it builds a loyal following. We also sold a great deal of gift baskets."
Gift baskets filled with skin care, fragrance and body care products are a strong customer draw for Nature's Elements. In fact, baskets have been moved to the back of the new store to pull customers through the aisles.
In older units, baskets are at the entrance.
A typical basket includes a 4.2-oz. bath massage oil, a 4.2-oz. body massage lotion, a 2-oz. therapeutic massage cream, a soap and a body massager, all retailing for $27.
Another wrinkle in Stuart's merchandising strategy is the location of custom-blended fragrances near the cash register.
Although Nature's Elements has offered custom fragrance blending before, this is the first time it has been given a prominent location at the checkout counter.
The rear of the store is reserved for new product promotions and currently touts a new Nature's Elements thigh cream called Thigh-Lean Cream. An 8.5-oz. jar is $18.
All Nature's Elements stores have point-of-sale scanners that provide weekly sales data.
The merchandise mix and space allotments for brands within the store are reworked according to changes in sales trends, said Stuart.
One of the more subtle refinements was Stuart's decision to move the gift baskets to the rear.
As a benefit of the electronic scanning system, Nature's Elements can add shoppers' names and addresses to its mailing list. The constant flow of sales data also means that as items sell out, orders are automatically placed. This helps alleviate the constant danger of having too much or too little inventory in the store.
Stuart, the former head of Jan Stuart Co., a defunct men's skin care venture, opened his first Nature's Elements store in 1989 in Nanuet, N.Y. Stuart plans to have 45 stores by the end of this year.
Four of those sites will be in Manhattan--in Greenwich Village, the Upper East Side, midtown and the Wall Street area.
Plans call for expansion into Buffalo, Syracuse and Albany, he said.
Those growth figures don't take into account mini-Nature's Elements units that Stuart is opening in outlets such as Duane Reade and Sears, Roebuck & Co.
Stuart is looking for more retailers to team with in joint ventures. Currently, two Duane Reade stores have Nature's Elements departments and there are plans to have 45 Sears stores stocked with at least a four-foot section of Nature's Elements by yearend.
Stuart isn't concerned that the mass presence will diminish sales in his specialty stores.
"Things have changed," he said. "You have a shopper who visits Sears in the morning and Bergdorf's at night. I believe greater exposure can only build sales."
He thinks Nature's Elements can fit into many national drug chain stores and offer them a way to enter the natural bath and body business.
Some retailers seem open to the concept. Sheri Ralston, cosmetics buyer for PayLess Drug Stores of Wilsonville, Ore., noted, "We would entertain outside retailers in our stores because in this business environment, you need to try anything that works."
Nature's Elements went public in March. For the first quarter of 1994, ended April 30, the company posted a loss of $1.5 million, or 39 cents per share, compared with a loss of $683,000, or 16 cents per share, last year.
Sales were $2 million, compared with $1.5 million for the same period last year.
The latest results include a charge of $635,140, or 16 cents per share, for recapitalization costs tied to the initial public offering.
Bernard Kossar, chairman and chief executive officer, attributed quarterly losses to expansion costs, which he said will be reduced as the company benefits from economies of scale.

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