There’s a real advantage to working for a family-owned company. Decisions — and execution — are quick and generally painless.
This story first appeared in the March 18, 2013 issue of WWD. Subscribe Today.
Jacque Hall would know. Before joining Belk as executive vice president and general merchandise manager of feminine apparel four years ago, Hall spent decades with May Department Stores Co., Federated Department Stores and Macy’s. Although she cut her teeth working with such retail luminaries as Allen Questrom, Terry Lundgren and Mike Steinberg, learning valuable lessons along the way, it wasn’t until she joined Belk that she felt the difference.
“Belk is family owned and operated, so it’s not as corporate,” she said. “There’s not as much hierarchy.” She said the operating structure is herself; Kathryn Bufano, who is president of merchandising and marketing, and Tim Belk, chief executive officer. “It’s a short runway.”
Hall related a story about how the team from Eileen Fisher recently visited the company at its Charlotte, N.C., headquarters and made a few suggestions about how to enhance sales of the brand. She, Bufano and Belk agreed and the decision was made. “It’s faster moving and there are fewer people to talk to,” Hall said. “Not that it’s not structured and you don’t need a business plan before you do something big, but we can make the smaller decisions quickly.”
This way of operating also allows merchants to be entrepreneurial, Hall said. “It’s like retail in the old days.”
Throughout her career, Hall has always overseen women’s ready-to-wear, so she brought a boatload of experience to Belk when she came to oversee all categories of women’s apparel. This includes dresses, coats, suits, petites, juniors and intimate apparel.
When joining the company, Hall quickly realized that she needed to enhance the fashion quotient. “We had a well-defined traditional business, but not fashion. Michael Kors and Calvin Klein were not even in the building,” she said. “So we’ve added a lot of fashion and excitement to the stores from a fashion point of view. We’ve built a more balanced fashion business, and in doing that, we’ve also strengthened margins.”
Hall started by determining which stores sold better merchandise the best and added fashion brands to these units first. “And we’ve learned we have to make an impact [on the selling floor]. You can’t just bring in two four-ways and hope the customer finds it,” she said.
So the merchandising was enhanced to make a statement. The brands were clustered into “neighborhoods” to make the shopping experience easier, with traditional or modern brands grouped to give “heft and presence” to the areas.
In all product categories, Belk has a tiered strategy in terms of pricing, with moderate and better-price goods offered in each area. “In our modern, updated area,” she explained, “we’ve built a base starting with opening price points in related separates and we’ve rolled that out to all doors. It’s the base of the pyramid.”
Layered onto that are Kors, Calvin Klein and Karen Kane, as well as Lilly Pulitzer, which has been a very strong performer for the company, Hall said.
Other brands that are gaining a foothold include Vince Camuto, which is being rolled out as well.
She also singled out Lauren Ralph Lauren as among the most popular brands. Belk carries a broad selection of the collection in its larger stores, and casual sportswear is found in smaller doors as well.
Overall, the edgier and higher-priced brands are in fewer doors, but they’re nevertheless drawing more fans lately. “Contemporary has grown to 41 doors,” Hall said, “which is a nice chunk.
“The contemporary business has been terrific, and the Belk customer is absolutely voting ‘yes.’”
Among the brands offered in contemporary are BCBG, Free People, which Hall said is “huge and very feminine,” French Connection, Trina Turk, Seven for All Mankind, Citizens of Humanity, Joe’s Jeans and Paige Denim. Miss Me, a brand with “a lot of bling,” is also popular, as is Jessica Simpson.
Traditional brands are also offered at different price points and range from Lauren, which is among the classic offerings, to Jones New York and the other brands in that stable, including Signature and Sport. On the moderate side of traditional, Alfred Dunner and Ruby Rd. are among the leaders.
Overall, Hall said, moderate merchandise is “already a big, steady business that continues to be good.” Belk addresses this customer with its New Directions private brand as well.
In all categories of business, Hall describes the Belk customer as “very feminine, no matter what age.” Everyone from girls and teenagers to mature grandmothers dresses up whenever they go out. “They could be going to the gym, but they’re wearing their makeup and jewelry,” she said. “They care about how they look.”
And this customer also loves color, embracing prints and bright hues throughout her wardrobe. “It’s not necessarily ruffles, but we sell a lot of ruffles too,” Hall laughed.
In fact, when fashion trends circle around to neutrals, “it’s not so good for us,” she said. “We have to have color and print, and Lilly is the epitome of that. It appeals to all ages.” She said that while high school girls and their grandmothers will put the Lilly Pulitzer selections together differently, they all embrace the brand. “We have almost a specialty store for Lilly in our stores,” Hall said.
And Belk does a huge business in dresses, particularly in the spring.
Denim has also been a standout. “Whether it’s one of the contemporary brands or Levi’s or Lee, or Calvin Klein or Lucky, denim has been outstanding.”
Like most of its counterparts, Belk tries to snag exclusives for its mix whenever possible. “Whether it’s an exclusive print with Lilly or an exclusive product with Lauren,” she said, “we try to keep balance with that.”
One of the initiatives to add exclusive product launched last year when Belk launched a contest called the Southern Designer Showcase. The contest was open designers who lived within Belk’s 16-state trading zone or had “a strong connection to the region” and whose designs matched the company’s identity of modern Southern style. “We’re proud of our history as a Southern-based retailer, and we want to introduce even more great brands to our assortment,” the marketing materials said.
Hall said Belk received more than 200 entries, ranging from the winner of Charleston Fashion Week to students at the Savannah College of Art and Design. A committee selected 15 brands in categories ranging from women’s rtw to handbags, jewelry, children’s wear and shoes, and these products were made by either the designers themselves or the Belk product development team. The merchandise is just now hitting stores and is being called out in stores and online.
“It was so successful, it’s led us to doing it again this year,” Hall said. The initiative also led Belk to become a sponsor of Charleston Fashion Week for the first time.
Hall said the women’s business overall has been experiencing “nice growth,” although it hasn’t been expanding at the same rate as men’s or center core. Even so, the company has been successful in gaining market share and has been making plans. Overall, feminine apparel represents about 36 percent of the business for the company.
Hall said Belk has worked to enhance its appeal to the Millennial customer, or younger shoppers. “That’s where the growth will be in the future,” she said. “The Baby Boomer has driven the ready-to-wear business for lots of years, but the younger customer will take over the fashion world. They’re hungry for newness.”
Hall expects most of that growth to come from the modern and contemporary areas, but as long as the more-classic vendors continue to update, they will get their fair share too.
“The Millennials shop differently,” she said. “That customer doesn’t dress head to toe in one brand, so she may buy in a department store, a specialty store or even a mass merchant and put it all together. She’s creative and personalizes the looks to herself.”
Even so, Hall looks at the other department stores — Dillard’s, Macy’s, Kohl’s and J.C. Penney — as her primary competition for this customer as well as her older counterpart.
But it’s Belk’s Southern roots that set it apart.
“About half our stores are in smaller communities in the South where the customer has grown up with Belk,” Hall said. “We understand her and go after her. If she needs a dress for church on Sunday or something to wear to work or if she’s a soccer mom, this company has consistently met her needs and desires.”