Nordstrom nears new opening

Presence in Columbia is part of hard push along the East Coast

Retailing

June 16, 1999|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

With its new department store at The Mall in Columbia mostly completed and scheduled to open in September, Nordstrom Inc. is continuing an aggressive push along the East Coast.

The Seattle-based retailer, which distinguishes stores with espresso bars, cafes, live piano music and shoeshine stands, will open its fourth department store in Maryland on Sept. 17 -- the latest since becoming an anchor at an expanded Annapolis Mall in 1994.

The retailer known for customer service and large size assortments expanded to the East Coast just over a decade ago and entered the Baltimore-Washington market in 1991, opening in Bethesda and at Towson Town Center in 1992.

In a 10-year strategy to grow in the nation's biggest metropolitan areas by building new stores, rather than acquiring existing chains, Nordstrom plans to open four department stores and four Nordstrom Rack discount stores each year, said Carol Gasper, a spokeswoman for the retailer's East Coast division.

About two-thirds of the new stores will be concentrated on the East Coast, where Nordstrom has 15 department stores, Gasper said.

The retailer, with $5 billion in annual sales, has not ruled out building more stores in Maryland, she said.

"It just depends if the right opportunity presents itself," Gasper said. "It's always a possibility. Columbia, which is not a top 50 metro market, was an opportunity from a market standpoint to have a link with Baltimore and Washington, D.C."

At 173,000 square feet, the Columbia store will be slightly larger than the average, newer-format Nordstrom store, because of growth potential in Howard County, Gasper said. It will employ 350 people.

The two-level store will include some exclusive brands, such as Faconnable fine-tailored European sportswear sold in its own boutique.

It will tailor the store to the local market, placing special emphasis, for instance, on children's and active-wear departments.

Nordstrom will be the centerpiece of the mall's current phase of expansion to more than 1.2 million square feet.

It will open along with an 80,000-square-foot wing of 40 smaller, mostly new stores, including an 11,000-square-foot Restoration Hardware, and specialty retailers such as April Cornell, Guess and Yankee Candle, said Nancy Tucker, a spokeswoman for mall owner Rouse Co.

A third phase of mall redevelopment, to be finished by fall 2000, will bring in two to three restaurants, a Bibelot bookstore and a premier General Cinemas movie theater. A Lord & Taylor department store opened last year.

Nordstrom, which runs 68 department stores and 25 Nordstrom Racks in 22 states, started as a shoe store in Seattle in 1901 and is now run by the fourth generation of the founding Nordstrom family.

Over the years, Nordstrom has earned a reputation for strong customer service and higher sales per square foot than competitors, said Michael J. Shea, a retail research analyst for D. A. Davidson & Co. in Portland.

The chain has historically performed well when entering new markets, he said.

Recently though, competition has become especially fierce, both from other department stores and specialty stores such as Gap, Ann Taylor and Victoria's Secret.

"The competition has become more efficient than Nordstrom on the systems side and has become more focused on the merchandise side," Shea said.

In the first quarter that ended April 30, Nordstrom reported net earnings of $31.5 million, down from $32.3 million for the first quarter of 1998, while basic earnings per share remained even, at 22 cents per share. Comparable store sales -- or sales at stores open at least a year -- declined 2.6 percent, the company's financial statements show.

Nordstrom has taken steps such as building smaller stores than the over-sized stores it built during the 1980s and early 1990s and slowing the pace of new store expansion, Shea said.

"It's become much more competitive," Shea said. "I think you will see them going forward do a better job at right-sizing stores in new markets.

"They're still known for customer service and sales per square foot approaching $400, which is the envy of the industry for department stores. And they have a good brand name. All those things, [competitors] would love to have."

Pub Date: 6/16/99

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