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Improved Inventory Accuracy

BY CSA STAFF

In April 2007, footwear manufacturer and retailer New Balance initiated an RFID pilot to determine if tagging individual shoeboxes would increase inventory accuracy and reduce out of stocks. New Balance partnered with Avery Dennison (Pasadena, Calif.) for the pilot. Philip Calderbank, director, global marketing RFID for Avery Dennison, discussed details of the pilot during a Supply Chain Summit session.

“RFID labels were applied to the shoeboxes with item-level indicators including size, width and style,” explained Calderbank. “The information is stored in one of three in-store databases indicating if the product is in stock-room inventory, sales inventory or sold inventory.”

RFID readers at the store’s back door update the stock-room inventory. Portable RFID readers enable daily inventory checks throughout the store. Readers on the sales floor maintain the sales database and RFID readers at the front door help keep track of the sold inventory.

The front-and back-door readers also help in the area of loss prevention. If a box of shoes leaves without being sold, the RFID reader captures the information and, as Calderbank noted, “The general rule of theft is that 60% of store losses are attributed to employees; only 40% are usually taken by customers.”

New Balance has also experienced significant improvements in receiving inventory. With the traditional barcode-scanning technology, it took an average of one minute to scan a carton of 12 shoe boxes. Using RFID, that same carton can be scanned in a matter of seconds.

In addition to reduced shrink and reduced receiving time, Calderbank indicated that New Balance anticipates RFID will contribute to reduced restocking time on the store floor, reduced out-of-stocks as a result of the daily inventories and a reduction in the amount of inventory needed at stores.

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Sears Holdings ceo unhappy with 2Q

BY CSA STAFF

HOFFMAN ESTATES, Ill. Sears Holdings today reported net income of $176 million, or $1.17 per diluted share, for the second quarter ended Aug. 4, compared with net income of $294 million, or $1.88 per diluted share, for the second quarter ended July 29, 2006. The company attributed the decline in its second quarter results from the same quarter last year to lower operating results at both Sears Domestic and Kmart, which were partially offset by improved operating results at Sears Canada.

“We are disappointed with our second quarter results. Our gross margins came under pressure from sales declines and increased promotional activity, and as a result, our net income was significantly below last year and our expectations,” said Aylwin Lewis, Sears Holdings’ ceo and president.

Sears Domestic’s comparable-store sales declined 4.3% for the quarter, while Kmart’s comparable-store sales declined 3.8%. Total domestic comparable-store sales declined 4.1%. The company reported lower sales across most merchandise categories at both Kmart and Sears Domestic, partially offset by increased sales of women’s apparel at both Kmart and Sears Domestic, as well as within consumer electronics and footwear at Sears Domestic. For the quarter, total revenues declined $0.6 billion to $12.2 billion in fiscal 2007, as compared to $12.8 billion for the second quarter of fiscal 2006.

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Lane Bryant pres. joins Christopher & Banks

BY CSA STAFF

MINNEAPOLIS Former Lane Bryant president Lorna Nagler will join Christopher & Banks as president and ceo effective Aug. 31. She will replace Matthew Dillon, who resigned from his position as president and ceo and as a member of the board of directors today. Nagler has also been elected as a member of Christopher & Banks’ board of directors effective Aug. 31.

Nagler most recently served as president of Lane Bryant, a division of Charming Shoppes. Before joining Charming Shoppes in April, 2002, Nagler served as a senior vp and general merchandising manager for apparel and jewelry at Kmart Corp.

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