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Federated Banks on Private-Label Brands

BY CSA STAFF

Cincinnati, Macy’s parent company Federated Department Stores is finding success with private-label branding, especially through its Macy’s stores. According to Tim Adams, chairman of Macy’s Florida, “Private-label brands give us a focus and distinctiveness in our assortment, at a price that is of great value to our customers.”

For Federated, experts say the private-label strategy makes sense in that the middle man is eliminated, resulting in profit-margin increases of at least 20% over name-brand designer goods and a level of exclusivity not found with name-brand products. According to Kurt Barnard, president of Retail Forecasting, a New Jersey-based consulting firm, “There’s not much profit to be had if you’re showing Calvin Klein and the next store is showing the same thing.”

Percentages of private-label merchandise are expected to continue rising. Marshal Cohen, chief industry analyst of the NPD Group, has predicted that, by 2010, private labels will represent about half of all apparel sales.

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Wild Oats Markets Posts Q1 Loss

BY CSA STAFF

Boulder, Colo., Wild Oats Markets suffered a net loss of $1.2 million in the first quarter, partly due to expenses related to a change in lease accounting and the opening of new stores. The company earned $2.1 million in the same quarter last year. Same-store sales declined 0.3% as total sales increased 5% to $278.1 million.

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Circuit City Responds to RadioShack Statement

BY CSA STAFF

Richmond, Va., Circuit City Inc. today disputed a statement issued by RadioShack, arguing that it has not relinquished its rights to the exclusive use of the RadioShack brand in Canada until 2009. RadioShack’s statement, released yesterday, said that it had won a lawsuit against Circuit City and was creating a subsidiary to oversee its Canadian expansion. Circuit City’s InterTAN unit currently runs RadioShack stores in Canada, but the two retailers are in a legal quarrel over the rights to the name.

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