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Saturday, March 10, 2001

Sears keeps moving upscale


Great Indoors unit heads to Springdale

By Elizabeth Oakes Pegram
The Cincinnati Enquirer

        Sears, Roebuck and Co. is planning to hire about 300 workers for a new upscale home-remodeling and decorating store opening in Springdale early this fall.

        The 130,000-square-foot store — 100,000 of it selling space — will need floral arrangers, interior decorators and other employees, said Kathleen Connolly, a Sears spokeswoman.

        Renovations are under way in converted warehouse space, but Ms. Connolly could not release an opening date nor the amount Sears plans to spend to fix up the building at 11925 Commons Drive.

TARGETED BUYERS
    Income demographics for Home Depot's EXPO design center, launched in 1991, and Sears' Great Indoors are similar, both companies say.
    The average Sears shopper in the Cincinnati area is a woman with a family, age 25 to 54, with annual income of $25,000 to $65,000, said Sears spokeswoman Peggy Palter. For the Great Indoors, the income level is slightly higher, Ms. Palter said, and the customer is a “little bit more upscale than the typical Sears shopper.”
    EXPO targets buyers with $60,000 combined household income, Home Depot's Melissa Watkins said.
        The store, part of Sears' fast-growing chain The Great Indoors, will include a home-decorating library with seating throughout the store, a Starbucks and products not found at traditional full-line Sears stores, such as Calphalon cookware, Viking ranges and custom hand-painted tiles and sinks, Ms. Connolly said.

        The 3-year-old Sears division, part of the home-furnishings industry's burgeoning megastore format, has the potential for $10 billion in sales and 200 locations, according to a report in September by Banc of America Securities.

        “The industry as a whole is very hot,” said Melissa Watkins, spokeswoman for Home Depot's EXPO Design Center, a potential rival launched in 1991. Home Depot officials say the company is considering a design center in Cincinnati, but has nothing lined up for this year.

        The Springdale Sears store will join a Great Indoors outlet in Ohio at Polaris Fashion Place in Columbus, also opening this fall.

        Sears says it plans to roll out 11 Great Indoors stores this year in the Midwest and West to add to its four already open.

        The Great Indoors format “doesn't look like a traditional Sears store,” said retail consultant Walter Loeb of the New York-based firm Loeb Associates. There is no sign on the front of the buildings linking The Great Indoors with the mass merchandiser, he said.

        Said Sears spokeswoman Peggy Palter, “We don't want to confuse customers” who come in expecting to find Die Hard batteries.

        The aim, said Mr. Loeb, is to appeal to high-end buyers who normally wouldn't think of shopping at Sears.

        The Great Indoors division is outperforming some of Sears' other categories.

        On Thursday, the retailer posted a 2 percent drop to $1.97 billion in sales during February at its U.S. stores open at least a year. The Great Indoors and automotive divisions recorded sales increases for the month, according to the company.

        “If you have a good mousetrap, people will come to it. And it's a very good mousetrap,” said Mr. Loeb.

        The Great Indoors chain is reaching about $50 million in revenue per store annually, said Ms. Palter.

        One potential drawback: Shoppers at the Tri-County Mall Sears might now go to the nearby Great Indoors store for custom drapes or blinds and some appliances, said Doug Kreyenhagen, store manager at the Eastgate Sears.

        “It's a test for Sears, though, because the Cincinnati (Great Indoors store) is real close to a Sears store and then the one in Polaris in Columbus will be in the same mall as a Sears store, which will be very interesting to see what happens,” he said.

        While the market for home improvement nationally is “enormous,” there are a finite number of store locations, said Murray Forseter, associate publisher and editor at Chain Store Age.

        “The industry is looking towards whether the Great Indoors or Home Depot's EXPO is the format that will be successful going into this decade,” he said.

       



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