DEL.ICIO.USAtlanta a ‘critical market’ for Belk
Department store has spent $35 million adding and expanding stores in the area
The Atlanta Journal-Constitution
Saturday, February 28, 2009
Belk Inc., a Southern department store chain, has been upping the ante in Atlanta. In the last two years, the company has spent $35 million expanding Atlanta stores and building new ones.
In March, Belk will open new stores in Newnan and Bethlehem, near Winder. Combined, the new stores created 200 jobs and cost $19.6 million to build.
Johnny Crawford/jcrawford@ajc.com
Anne Klein designs are among the clothing lines on sale at the Belk at Phipps Plaza.
Johnny Crawford/jcrawford@ajc.com
Summer will be here before you know it, and Belk is ready with new sandals for $240 from Donald J Pliner.
Johnny Crawford/jcrawford@ajc.com
McKay Belk, president of the chain that bears his name, was in Atlanta on Thursday.
The small regional chain has 23 stores in metro Atlanta and has invested $35 million in this market over the last two years. Investments include:
• Newnan — $12.5 million on new, 121,000-square-foot store, that replaces an existing store.
• Winder — $7.1 million on new, 74,000-square-foot store.
• Alpharetta — $3.5 million to move Alpharetta store to the former Lord & Taylor space at North Point Mall and to add a home store.
• Kennesaw — $1.65 million to expand store by 17,000 square feet to 164,000 square feet and to add a home store.
• Douglasville — $550,000 to expand store to 148,500 square feet, add a home store and men's big and tall shop.
• Snellville — $2.8 million to expand store to 90,000 square feet.
Source: Belk Inc.
BUSINESS
Latest Headlines:
[an error occurred while processing this directive] • More business news
• Business photo galleries
“We’ve always viewed Atlanta as a critical market in our footprint,” said McKay Belk, president and chief merchandising officer, who was in Atlanta on Thursday visiting stores.
But the chain, with 23 stores in Atlanta, is facing some challenges here.
In 2006, Belk bought 40 Parisians stores from Saks Inc., giving it locations in places like the glitzy Phipps Plaza, where it competes with stores like Saks and Nordstrom.
But drive 40 miles to Canton and the Belk there competes with J.C. Penney.
It’s a balancing act that the chain — founded in Charlotte in 1888 — is playing as it deepens its ties with the Southern consumer.
The disparate locations — and in some places stock — are a result of a chain that was founded before malls existed, Belk said.
The chain may need to do more to differentiate those stores with segmented marketing, said Randy Stuart, an assistant professor of marketing at the Michael J. Coles College of Business at Kennesaw State University.
“You can’t be all things to all people,” she said. “You can’t use the same promotion for everybody. You have to convince the Phipps customer, who likes shopping at Saks, to go there. Give them a reason.”
When asked how consumers have responded to the rebranded store at Phipps, McKay Belk admitted it’s taken some time to catch fire .
Walking into the Phipps store, there are bright displays of Chanel, Lancôme and Lilly Pulitzer cosmetics.
High-fashion shoes, like a strappy, leather stiletto heel by Pelle Moda for $206, adorn walls lit for maximum impact.
Upstairs in ladies clothes is a huge poster of Kristin Davis, the polished “Sex in the City” actor who was raised in South Carolina. She has created an exclusive clothing line for Belk. (Davis will be in Atlanta to promote the brand March 31).
“She has roots in Columbia, S.C., and knew us well. Her mother brought her to shop at Belk as a young girl. She really understands Southern women and their style,” Belk said.
The chain has three stores in glitzy malls, including Phipps, Southpark Mall in Charlotte and Crabtree Valley Mall in Raleigh. He has a team that buys for those stores.
He said it may still “take some time” here. Offerings at Phipps include a personal shopper with a private suite for trying on clothes and sipping water, coffee or even wine. The store carries BCBG, Lucky Jeans and Free People as well as lines made exclusively for the chain by Davis and Madison.
The Belk chain has made the Phipps store its flagship location. In general, the chain is targeted at a working woman, Belk said, ages 35 to 55, whose household income is $70,000 and above.
Belk said the chain is going to ramp up its marketing efforts here and is relaunching its Web site.
The chain also is moving its Southern division office from Jacksonville to Atlanta this summer. Belk sees the move of about 10 employees as significant.
“Atlanta is so important and more centrally located to the region,” he said.
If it seems counter-intuitive to be investing during a consumer recession, Belk says his company’s investors and board “take the long view” and understand that retail is a cyclical business.
The company is privately held. It reports earnings to the Securities and Exchange Commission for its 309 stores in 16 states. Net sales for the company’s fiscal third quarter, which ended Nov. 1, fell 8.3 percent to $741.1 million. Same-store sales dipped 9.8 percent for the quarter.
“There are more ups and downs in a business like this,” Belk said. “It’s harder for Wall Street to take and figure that one out. We realize it’s going to happen and we don’t get overly excited about a downturn.”
Services »
