FINANCE

Kroger Workers Reject Contract Offer

BY CSA STAFF

Cincinnati, Kroger workers in the Cincinnati region voted on Wednesday to reject a new three-year contract proposal from Kroger Co. that would increase health-insurance costs for employees.

Leaders of the United Food and Commercial Workers union had urged rejection of the offer, giving membership the authority to call a strike if future negotiations don’t progress. Union leaders said the proposal by Kroger also offered sub-par wage increases.

According to union officials, Kroger’s offer was rejected by 98% of voters, and turnout was strong. The union represents 11,000 employees in 77 stores.

A contract that expired Saturday has been extended to Nov. 3, but either side could cancel it with four days notice.

Kroger has negotiated new contracts in a half-dozen other regions this year, including Texas, Michigan and Southern California.

The company operates 2,491 supermarkets and multi-department stores in 31 states under two dozen local banners, including Kroger, Ralphs, Fred Meyer, Food 4 Less, King Soopers, Smith’s, Fry’s, Dillons, QFC and City Market.

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Study: Teen spending out of fashion

BY CSA STAFF

MINNEAPOLIS Teen spending in fashion declined 24%, according to a recent Piper Jaffray study. The survey found that spending decreases were most common among young women where spending was down 18%, as compared to a decline of 9% for young men.

Despite the drop in spending, the survey found that fashion is still important to teens.

“The fashion category still represents 42% of the total teen budget for the fall 2007 season despite moderation in spending habits,” said Jeff Klinefelter, senior retail research analyst at Piper Jaffray. “However, we found that spending expectations remain largely unchanged, as nearly 50% of the students plan to spend the same amount of money on apparel this season. We believe the discrepancy between budget dollars and expectations may be due to a decline in contributions from parents.”

Of the places where teens prefer to spend their money, Hollister topped the list for the sixth consecutive time, followed by West Coast Brands, American Eagle, Abercrombie & Fitch and Forever 21.

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Gap Inc. to open in the Philippines

BY CSA STAFF

SAN FRANCISCO Gap Inc. announced Tuesday that it is partnering with the Rustan Group of Companies to bring the Gap and Banana Republic brands to the Philippines. Under a franchise agreement, Gap Inc. plans to open approximately eight Gap stores and four Banana Republic stores throughout the country.

The first Gap store is expected to open by the end of this year, and the first Banana Republic stores by spring 2008. All stores are scheduled to be open by 2012.

“The Philippines represents a natural market for Gap Inc. to expand its international presence,” said Ron Young, senior vp of international strategic alliances for Gap Inc. “The country has a strong, steadily growing economy, and consumers in this market have a great interest in iconic apparel brands such as ours.”

Gap Inc. reported that the Rustan Group will hold exclusive rights to operate Gap and Banana Republic stores in the Philippines. In addition, the company said tha the Rustan Group will purchase merchandise from Gap Inc. or suppliers designated by Gap Inc., and must adhere to Gap Inc.’s quality standards to preserve the reputation of the Gap and Banana Republic brands.

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