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The long-term strategy to bet on outlet stores over department stores has begun to pay off for Bealls.
Revenues in the Bradenton-based retailer's outlet store division surpassed the department store division for the first time in its most recent fiscal year. The company, with $1.07 billion in 2009 revenues, also plans to open 27 outlet stores in October and November, a two-month record. Most of the stores will be in the South and southern Midwest, adding to its 450 stores in 15 states.
“The outlet business has been very good for 18 months or so,” Bealls CEO Steve Knopik tells Coffee Talk. “This year's group of new stores has been fabulous.”
Knopik cites several reasons for the good turn of events. For one, the economy and job market seems to have bounced back quicker in the states the outlets are in other than Florida — a significant point because the department stores are primarily focused on the Sunshine State.
Knopik also says the outlet managers and retail buyers have made a conscious point to alter the merchandise selection to reach new customers. “Macy's customers could be trading down to us,” says Knopik.
Finally, Bealls got a boost from Goody's Family Clothing, which filed for bankruptcy in 2008. A portion of the new Bealls outlet stores, from North Carolina to Mississippi, will be in vacant Goody's stores, which are the right size for Bealls' new outlet prototype. Older outlet stores in the chain are usually smaller.
Despite the good news Knopik still takes a wary look at the overall economy. “The economic challenges in the United States and in Florida continue to be a concern,” he says.
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