Bloomingdale’s Makes Plans for 4 Stores in Southland : Business: Department store chain is shopping for sites, chairman says. Move could revitalize area’s retailing sector.
Bloomingdale’s, the ritzy New York retailer known for its extravagant store displays and pricey merchandise, has announced plans to open four stores in Los Angeles and Orange counties. The move could inject a new spark into the region’s moribund retailing sector.
The 15-store chain is shopping for sites from the Westside to the San Fernando Valley and Orange County. The first California store could open by spring, 1997.
“This means that California is back,” said Jack Kyser, chief economist at the Economic Development Corp. of Los Angeles County. “Retailers are in a frenzy to get in here and lock up the best locations. This is a sign that the Southern California economy is no longer at rock bottom--it’s beginning to rebound. Orange County has boomed back to life this year, and there are signs of life in Los Angeles County.”
Paul Kranhold, a spokesman for Gov. Pete Wilson, said: “This is great. We hope it’s another signal of the ever-improving California business climate. . . . This should serve as a small but notable example that California is still attracting business.”
Expansion of the famed East Coast retailer, owned by Cincinnati-based Federated Department Stores, is sure to intensify competition locally, analysts say. It could also revitalize a retailing segment that was among the hardest hit industries during the recession.
In recent years, Buffums went out of business, Bullock’s closed stores and the Robinson’s and May Co. stores were combined into a single chain. The closures left numerous malls scrambling to find creative ways to fill the empty shells left behind.
Meanwhile, discounters such as Price Club, Wal-Mart and Ikea have taken root in so-called “power centers” across the country and pulled away many regular department store customers.
Traditional retailers have learned their lesson, analysts said. “Department stores are beginning to adapt themselves to a more value-conscious consumer,” said Kurt Barnard, publisher of a New York-based retailing newsletter. “Department stores are beginning to climb down the ladder and make themselves more accessible and more affordable.”
Bloomingdale’s, under the leadership of Chairman Michael Gould, is among those chains making changes to lure back customers from the discounters. For instance, it now offers more private-label apparel, which has the look and feel of designer clothes at a fraction of the price, Barnard said.
The rebirth of department stores could also mean the blossoming of regional malls, which were battered in the recession.
While Gould said he expects his chain will build new locations rather than take over existing sites, its presence could pump life into malls that have lost anchor stores.
Some malls just left their closed stores empty, dressing up the fronts with stages for community plays or simply boarding them over.
Gould said Bloomingdale’s has been negotiating with mall owners, including those at the rival Fashion Island Newport Beach and South Coast Plaza malls. Sites are also being scouted on the Westside and in the San Fernando Valley, though Gould would not identify specific locations.
“The mall that gets a Bloomingdale’s will get a big lift,” Kyser said. “The question is: How well will Bloomie’s adapt to Southern California? Bloomie’s built its reputation on being ultra-New York. However, I expect Bloomingdale’s to turn up the competitive pressure on more upscale retailers in the area--chains like Nordstrom, I. Magnin, Saks and Barney’s.”
Nordstrom officials, however, said they would welcome Bloomingdale’s arrival.
“Competition makes everyone better,” said Pete Nordstrom, a regional manager in greater Orange County and a great-grandson of the chain’s founder. He said a Nordstrom store is situated in the same mall as Bloomingdale’s in Minneapolis, and both stores have thrived.
Bloomingdale’s glamorous reputation is derived largely from its flagship store on 59th Street in New York City. Upscale shoppers consider the store to be a place “to see and be seen.”
The store offers cutting-edge fashion presented with elaborate displays using spotlights and other glitzy adornments, prompting some to dub it retailing’s “Greatest Show on Earth.”
Bloomingdale’s is credited with a number of modern retailing innovations. It helped turn fashion designers such as Ralph Lauren, Donna Karan and Calvin Klein into celebrities by dividing its sales floor into boutiques that feature their products.
The retailer is also known for exclusive offerings. In its “Only at Bloomingdale’s” collection, the company offers certain clothing and goods for the home that no other U.S. retailer sells.
Although it has been considered a glamour icon of retailing, Bloomingdale’s also developed a reputation for curt and inattentive service--a reputation it has been trying to change with improved customer attention.
Bloomingdale’s managers say they are also tailoring their stores to suit the tastes and shopping habits of shoppers in other parts of the country.
Ironically, Bloomingdale’s Southland competition will include Bullock’s and I. Magnin--two chains that Federated formerly owned and subsequently sold to New York-based R.H. Macy & Co.
Gould said in an interview that he believes his chain can find its place in the Southland.
“We think Southern California lends itself to our business,” he said.
Though its western-most store is in Minneapolis, Bloomingdale’s has seen steady catalogue sales from this region, he said.
“We know the number of customers shopping with us in California, and it’s about time we came out and took care of them,” Gould said. He added that he is not put off by the lackluster Southland economy. “We want to have a beachhead. . . . There is a big opportunity.”
