FEDERATED GIVES MERCHANDISE EXECS MORE DUTIES AS IN-HOUSE PRODUCT PATROL
Byline: David Moin
NEW YORK — To insure that merchandise developed in-house doesn’t duplicate the look of goods bought from Seventh Avenue suppliers, Federated Department Stores has expanded the roles of 26 executives in women’s accessories, children’s wear, men’s furnishings and clothing, and home furnishings.
They’ll now be walking on both sides of the street — the Federated product development side and SA side.
The company also said Thursday its Federated Merchandising unit, at 1440 Broadway, and Federated Product Development arm, at 11 Penn Plaza, will be under one roof by early next year, somewhere between Madison Square Garden and Times Square. The location was not specified since real estate negotiations have not been concluded.
Terry Lundgren, Federated’s president and chief merchandising officer, said the changes will cut costs and about 30 jobs, including 15 through attrition.
But he emphasized that the moves are primarily to “speed communications and the decision-making process and make sure that we don’t duplicate our inventories in private label with what we already get with branded suppliers, and vice versa.”
Three senior vice presidents and 23 vice presidents now have the dual function. Those under the level of vice president will continue to either have private label design and development roles, or only cover the market.
Senior vice presidents at Federated Merchandising adding product development duties are Allan Zwerner, men’s and children’s wear; Janet Grove, jewelry, accessories, shoes and intimate apparel, and Ron Klein, home store.
“This allows us to grow people and give career paths to people who now have new opportunities,” Lundgren said.
Senior vice presidents report to Lundgren.
Women’s apparel, cosmetics and men’s sportswear will continue to have separate product development and market staffs, Lundgren said. “These businesses move at a faster rate and aren’t advantageous to putting it all together.”
No senior executives are leaving the firm, though some have altered responsibilities. Debbie Martin, who had ready-to-wear, accessories and shoes, product development responsibilities, will now just focus on rtw.
Ken Mesnic, senior vice president, will oversee housewares development, reporting to Ron Klein. He previously supervised product development for home, men’s and children’s wear.
Federated Product Development has about 500 employees. The Merchandising unit has roughly 260. With the integration, the operations now have one name, the Federated Merchandising Group.
The company is on a campaign to expand its private label offerings. Prior to the Macy merger, private label represented about 5 percent of Federated’s sales. Last year, it represented 13 percent, and this year, it’s seen hitting 15 percent. “It could reach 20 percent in a couple of years,” Lundgren said.