Movie Gallery Looks to Sublease at 2,200 Locations
Dothan, Ala., Movie Gallery, Inc. said it entered a management agreement and alliance with Excess Space Retail Services, Inc. to explore opportunities to sublease space at more than 2,200 existing Movie Gallery and Hollywood Video stores. Movie Gallery expects retail partners to occupy about 2,500 sq. ft. at each location. “In addition to the incremental revenue we expect to realize through subleasing portions of the stores, we look forward to the additional traffic that our retail partners will generate,” said Keith Cousins, executive VP and chief development officer, Movie Gallery, Inc. “By taking advantage of our outstanding retail presence, we expect this initiative to improve our operating results and create value for our shareholders.”
Kmart Settles Class-Action Disability Suit
Denver, AKmart spokesman said the company settled a class-action suit Monday over access for disabled shoppers. The agreement gives the company 7.5 years to bring its nationwide stores into compliance with federal standards for merchandise, counters, restrooms, fitting rooms and parking lots. The $13 million settlement, which was filed in the U.S. District Court in Denver, includes $8 million in cash and $5 million in gift cards. It will be distributed to plaintiffs in California, Colorado, Hawaii, Massachusetts, New York, Oregon and Texas, whose laws have minimum damages for failing to comply with disability-access rules. The plaintiffs’ attorney Amy F. Robertson said the most an individual could receive would range from $100 in Colorado to $8,000 in California, depending on state laws. Kmart spokesman Chris Brathwaite would not speculate on how many of Kmart’s 1,400 stores might require changes or how much they might cost.
Study Measures Negative Experiences
Jersey City, N.J., Unhappy customers can mean trouble for retailers. A study by Verde Group and the Baker Retailing Initiative at the Wharton School at the University of Pennsylvania reported that more than 50% of Americans say if a friend or colleague told them about a negative in-store experience, they would avoid the store, too. About 50% of consumers have had a poor shopping experience, and 31% tell an average of four friends, The Star Ledger reported. The survey generated 1,200 responses from U.S. consumers who made purchases worth less than $2,500 during the four weeks leading up to Christmas 2005, with the average purchase price at $163. Typical problems were slow lines, trouble finding products, staff that didn’t know the product or lacked courtesy, and parking difficulties. “This study is unlike anything we’ve seen before because it shows that for every 100 American shoppers, 64 people will be told about a store’s poor products or services, and no matter what the store does to entice shoppers, these people will not set foot in their store,” said Paula Courtney, president of Verde Group.