J.W. Robinson Co. said Monday that it will close its Anaheim Plaza store on Jan. 23. At the same time, the department store chain announced a $105-million plan to open four new stores in Southern California and remodel a fifth.
Robert L. Mettler, Robinson's president and chief executive, said in a prepared statement that the Anaheim store "has been the smallest in volume and productivity of our 25 stores." Since the September opening of a new Robinson's store at nearby MainPlace/Santa Ana, much of Anaheim Plaza's business has been siphoned away.
The 76 full-time employees of the 178,000-square-foot Anaheim Plaza store will be offered continued employment at other stores within the chain, the company said.
Robinson's departure leaves Anaheim Plaza with only two anchors--the Broadway and Mervyn's.
Mettler said in an interview that the long-rumored closure of the Anaheim Plaza store is a move to "concentrate on our other stores."
The chain's five-year plan comes 15 months after Robinson's became a division of May Department Stores. The expansion puts to rest, at least temporarily, industry rumors that May planned to sell portions of the troubled chain.
Instead, industry analysts viewed Robinson's announcement as a bold step that could finally position the chain for profitability. At the same time, the fierce battle for the dollars of Southern California shoppers is almost certain to intensify among the big three upscale chains--Robinson's, Nordstrom and Bullock's, experts predicted.
Robinson's $105-million investment will pay for a 135,000-square-foot store scheduled to open in Northridge this fall, a 140,000-square-foot store planned to open at Brea Mall in the fall of 1989 and two new stores at undisclosed locations that will open in 1991. The Mission Viejo Mall store will also be expanded to 137,000 square feet in a major remodeling next year, and Robinson's will invest in "other capital projects," such as computer equipment, a spokesman said.
Mettler hailed the multimillion-dollar investment as "the largest expenditure of any five-year period in the history of Robinson's" and "demonstrates the confidence we have in the Southern California market." He said Robinson's, which has stores from Santa Barbara to San Diego, has been "performing satisfactorily."
But the Anaheim Plaza store evidently is another matter.
The Anaheim Robinson's is not only in the backyard of its sister store in Santa Ana but is also about eight miles from the planned store in Brea.
Moreover, the Anaheim Robinson's is not in the enclosed portion of the mall--a merchandising minus.
One result of the plummeting sales was that the store converted its third floor into a cut-rate department to dispose of merchandise that did not sell at other, more profitable stores.
The Anaheim Plaza store also suffered from being in a 30-year-old mall--one of Orange County's first major shopping centers, industry sources said. Greg Glass, a senior vice president of development with Melvin Simon & Associates in Los Angeles, which manages Anaheim Plaza, said sales at the mall dipped 5% in 1986.
Anaheim Plaza, in fact, has been trying to pull together plans for a renovation that would involve a redevelopment project with the City of Anaheim. On Monday, Ron Bates, assistant city manager, said a survey map--the first step in the redevelopment process--is being completed for Anaheim Plaza.
An official with the mall owner, the California State Teachers Retirement System, said Monday that "we do have a plan" about how to renovate the mall. He declined to give details.
The Robinson's site is owned by the department store chain and is likely to be sold, Glass said. "May Co. has a history of vending excess real estate whenever (it) can. It's a non-productive asset. . . . If they can turn it into cash, it's much better for them," he said.
The closure of the Anaheim Plaza store is viewed by industry analysts as a step in the right direction for Robinson's.
When May Department Stores acquired Robinson's parent company in October, 1986, it was a troubled firm suffering from out-of-control costs and lack of inventory.
Robinson's executives concede that the chain lost "more than several million dollars" in 1986 on sales of $586 million, said Edward Weller, an analyst with Montgomery Securities in San Francisco. May Department Stores had 1986 sales of more than $10.3 billion.
But with the expansion, Weller said, "they're competing intensely for business. It's plain that May Co. is committed to making Robinson's as good as it can be--$105 million implies a fairly serious commitment."
Weller added that Robinson's and May "plainly have brought more discipline and better controls and are intensifying the focus--and they're obviously willing to spend money to do it right. . . . I think Robinson's will be in a little better position to make money," Weller said.