WEINER’S CHANGING NAME AND FOCUS
Byline: Rusty Williamson
DALLAS — Weiner’s Stores Inc., the moderate chain that took Chapter 11 protection last week due to cash flow problems, is changing its name and broadening its merchandise mix.
Commencing February, the 75-year-old Houston-based family retailer catering to an ethnic urban crowd, will officially be known as Weiner’s Plus and focus on selling more home products, such as small appliances, bed and bath items, small furniture, housewares and toys.
The name-change will coincide with a redesigned store layout and a fine-tuned apparel mix that accents trendier, casual fashions and additional children’s clothing.
“One of our strongest businesses has been and remains the home arena,” explained Joseph Kassa, president of Weiner’s. “It’s something that our customer wants to buy more of, but we’ve had no room for it. Starting in February, we’ll have the space. Home and related areas will jump to 22 percent of our total mix, which is about double the current ratio. We plan to grow the home area to overcome the sales slide in activewear and other soft areas.”
The extra space for home furnishings comes at the expense of structured sportswear, dresses and Levi’s jeans, which have been weak over the last year. Back-to-school sales were especially disappointing, Kassa added.
“It got us into a credit crunch with lenders,” he said.
Branded athletic apparel also has performed poorly with the exception of Nike clothing and footwear.
Kassa said women’s apparel will shift to accent more casual, related separates and trendy, street-inspired items, such as fashion bottoms and novelty tops. He also plans to emphasize CK Calvin Klein, streetwear and club clothes for young men.
Ray Miller, Weiner’s chairman and chief executive officer, said the chain fought to avoid bankruptcy protection but a cash shortfall imperiled its ability to purchase merchandise for holiday.
“With the filing, our credit availability is now three to four times what we had before the crunch. We have a $35 million debtor-in-possession financing facility with a sub-facility for $15 million for letters of credit,” he explained. “Merchandise is moving back into the warehouses. We believe we’ll get back into business very fast.”
By Dec. 24, the chain plans to close 44 underperforming stores, leaving it with 97 units located in densely populated inner-city markets in the Southwest.
“What have we learned by this Chapter 11 filing? We’ve got to be more responsive to what consumers want to buy,” Miller said. “In hindsight, I wish we would have done that a long time ago.”
Earlier this year, Weiner’s announced a turnaround plan that centered on expanding into new markets and remerchandising stores by next year to play up private label and casual apparel and home goods. Apparently, efforts on the home front are being intensified. The turnaround bid was derailed by the chain’s lack of cash and disappointing fall apparel sales.
As reported, Weiner’s had a $5 million loss on total revenue of $62.7 million for the quarter ended July 29. In the comparable year-ago period, Weiner’s reported $463,000 in income on total sales of $79.5 million.
For the second half, the chain’s losses were $5.5 million on total revenue of $129.1 million. In the year-ago period, Weiner’s posted $2.5 million in income on sales of $149.1 million.