Woolworth to close, sell or revamp 900 stores

January 09, 1992|By Michael Dresser | Michael Dresser,C&P Telephone, Donnelly

Woolworth Corp., the beefed-up and spread-out modern version of the corner five-and-dime store chain, resolved to slim down and shape up, as it announced plans yesterday to close, sell or revamp 900 "underperforming" stores nationwide. The program will involve nearly 10 percent of its 9,300 outlets worldwide and directly affect 10,000 employees.

To pay for this "accelerated redeployment program," which comes on the heels of a disappointing holiday shopping season, Woolworth will ring up an after-tax charge against earnings of approximately $250 million, or $1.92 a share.

The venerable but recession-battered company, part of U.S. popular culture since the 19th century, saw sales at established stores, the most widely watched indicator of a retailer's health, drop 1.7 percent over the first 11 months of its fiscal year. December sales were down 0.5 percent on the same basis.

The redeployment program will put an end to one of the company's chains, the 207-store Susie's/Sportelle women's vTC clothing boutiques, and a possible end to the 268-store Richman Brothers clothing chain, which Woolworth will discontinue if it cannot sell the stores.

Susie's had three Baltimore-area outlets, one of which -- at Columbia Mall -- has already closed. The Reisterstown Road Plaza store will close Jan. 18.

The Eastpoint Mall store remains open, and Assistant Manager Deborah Ross said yesterday afternoon that she had not heard of any plans to close.

There is another Susie's in Laurel.

There are four Richman Brothers stores in the metropolitan area.

It was not clear yesterday which of Woolworth's other area stores might be discontinued. The company said that nationwide it would close about 15 percent of its Kids Mart and Little Folk Shops; 25 percent of its Kinney shoe stores; and 8 percent of its Woolworth and Woolworth Express general merchandise stores. But information on specific locations was not available yesterday. The company said that closings and changes would be announced over the next 12 to 18 months.

In many cases, Frances Trechter, a company spokeswoman, said, a store that closes under one Woolworth name will be reborn under another. Many of the shuttered storefronts could reopen as links in Woolworth's successful Foot Locker and Ladies Foot Locker chains.

Decisions on whether to change formats instead of close outright would be made on a store-by-store basis, she said. "It would depend on the restrictions in the lease and the particular location," Ms. Trechter said. For instance, some malls might rule out a switch to Foot Locker because they already have enough shoe stores.

Ms. Trechter said the "redeployment" was not a new policy but an acceleration of a program that had been in place since the early 1980s.

For the three quarters that ended Oct. 26, 1991, the company said, the stores targeted for changes lost about $50 million, taking a big bite out of Woolworth's profits, which stood at $168 million at that point.

Woolworth said about 4,700 full-time and 5,300 part-time employees would be affected by the program. The company will offer those workers employment in new-format stores wherever possible, Ms. Trechter said, and would offer a separation package to those who can't be placed in other Woolworth stores.

"I think it's a move to streamline operations and improve profitability," said Carol I. Palmer, an analyst with Duff & Phelps in Chicago.

Wall Street agreed. The company's stock rose $1.50, to $29 per share.

Area Woolworth Corp. stores

This list of Woolworth Corp. stores that belong to chains affected by the "accelerated redeployment program" is taken from current Yellow Pages books for metropolitan Baltimore and for Laurel.

The company has not yet identified all of the stores that will be closed, and many of these are expected to remain open. Foot Locker and Lady Foot Locker stores are not affected.

Kids Mart

(no closings announced)

Eastpoint Mall

Reisterstown Road Plaza

6400 Rossville Blvd.

Kinney Shoes

(no closings announced)

Annapolis Mall

Eastpoint Mall

Golden Ring Mall

Mondawmin Mall

Reisterstown Road Plaza

Harford Mall

Columbia Mall

Glen Burnie Mall

Marley Station Mall

Owings Mills Town Center

White Marsh Mall

Cranberry Mall

Laurel Centre

Little Folks

(no closings announced)

Marley Station Mall

Richman Brothers

(to close or be sold)

Hunt Valley Mall

Marley Station Mall

Security Mall

White Marsh Mall

Susie's

(all to close)

Columbia Mall (closed in Dec.)

Reisterstown Road Plaza

(closing Jan. 18)

Eastpoint Mall

Laurel Centre

F. W. Woolworth Co.

(no closings announced)

3506 Eastern Ave.

5628 The Alameda

3228 Greenmount Ave.

5650 Baltimore National Pike

5714 Ritchie Highway

Reisterstown Road Plaza

11933 Reisterstown Road

Perry Hall Shopping Center

223 W. Lexington St.

1959 E. Joppa Road

Westminster Shopping Center

Harford Mall (Bel Air)

6901 Security Blvd.

Mount Clare Junction

(West Pratt and Carey St.)

Woolworth Express

(no closings announced)

Golden Ring Mall

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