NEW YORK — Fall marks the first big test for the reengineered Sears Holdings private label apparel and accessories program.
The retailer has adopted a vertical approach to product development involving sourcing and designing in-house, bypassing the domestic market in favor of direct importing, and having merchants function as general managers rather than selecting goods. Teams at Sears and Kmart divisions — ranging from sourcing and design to finance, legal, marketing, stores and human resources — have been integrated, practically completing the merger process.
One day, Sears and Kmart might be one, with the same merchandise and maybe one nameplate. But for fall, it's one organization feeding the two stores different labels and different fashion messages, and exerting tighter control over designs, pricing and quality.
At last week's fall fashion preview for both chains, Lisa Schultz, executive vice president of Sears Holdings Apparel Design, said, "It's a pivotal season for Sears. In Kmart, we're building on momentum."
The major differences: Kmart takes an item focus that feels younger and is priced to compete with Wal-Mart and Target; Sears emphasizes complete outfits, classic styling, femininity and prices comparable to J.C. Penney's and Kohl's.
At Kmart, Schultz said, "We're really focused on easy components," with the two-and-a-half-year-old Attention private brand getting a bigger play for fall, and becoming the lead look as you enter the stores. Key items that Kmart will be banking on include Attention's rayon wrap dresses at $19.99, stretch twill and herringbone tweed bottoms at $19.99, Jaclyn Smith printed blouses for $19.99 and Thalia jeans for $24.99.
Schultz said the jeans are proven sellers: "They have a very flattering fit. They're not too tight, not too large, not too high or low. The jeans fit a lot of body shapes well."
Another key item is Route 66 low-rise jeans, at $19.99. They are more rugged and appear worn.
Kmart will be breaking out more costume jewelry, including necklaces and bracelets, as well as handbags.
Success depends on how Kmart presents the fashion. For years, selling was hampered by a cluttered presentation that buried potential strong items. The company has begun to clean up the stores, but so far only about a handful of stores have been significantly touched. All stores, however, have been cleaned up, and culled, with a clearer, more organized emphasis on about a half-dozen key apparel labels.Sears this fall will emphasize Covington sheer crepe blouses at $34 that are more feminine and less trendy than in the past. Softer suitings, including pinstripes with a touch of purple, and Apostrophe skirts with feminine details, will also be played up. Lands' End, which is operated separately from Sears Holdings Apparel Design, is focusing on fake shearlings, cashmeres, corduroys and cardigans.
With Sears and Kmart, "the demographics are similar. It's more the look, feel and style that is different," said a Sears Holding spokesman. Kmart's apparel has been outperforming other categories, whereas Sears' apparel continues to struggle.
Private label represents the lion's share of Kmart's and Sears' apparel and accessories assortment. It's said to be around 75 percent of the total. Fall merchandise hits the stores around mid-July.
There's been a bit of blending on the hard goods side so far, with Kenmore appliances and Craftsman tools from Sears now available in some Kmart stores, and Sears' DieHard batteries in all Kmart stores. If the test succeeds, it could mean more Sears merchandise on Kmart shelves. Asked if there will be some fashion merchandise shared by Kmart and Sears, Schultz replied, "There may be some things, but not for 2006."
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