Despite a healthy economy, it’s been a rough eight months for the underdogs of the discount store industry. Montgomery Ward & Co. filed for Chapter 11 protection last July, and Venture Stores followed suit in January.
The two events were actually related, said Robert Wildrick, Venture’s chief executive. Manufacturers stopped shipping to the struggling St. Louis-based chain after Wards’ filing. “They said, `We just lost a ton on Montgomery Ward. We can’t take a risk on you,”‘ Wildrick said.
But now Venture is trying to battle back, and Chicago, as its largest market, is key to that strategy. “We’re not a shrimp in Chicago. We’re a competitive factor,” Wildrick said.
The chain already has dumped schlocky merchandise and set up a laboratory to test product quality. Its private-label denim line known as Stone Mesa has been well received, Wildrick said.
Venture also is trying to boost its credibility. For too long, the chain has been out-of-stock on advertised items. It’s making progress, but the problem is still not entirely fixed, Wildrick admits.
Venture’s biggest mistake, though, was spending $400 million in the early 1990s to expand into Texas and Oklahoma. Meanwhile, big competitors such as Target and Wal-Mart moved in on Venture’s three core markets: St. Louis, Chicago and Kansas City.
So any comeback will be an uphill battle, but Wildrick is hoping Chicagoans will give his store another chance: “If we can get our Chicago customers back, they will be pleasantly surprised, and we will keep them.”
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Retiree setback: The battle by Sears, Roebuck and Co.’s retirees to get their life insurance benefits restored has been dealt another blow. The 7th U.S. Circuit Court of Appeals here recently rejected similar claims by the retirees of the Equitable Life Assurance Society.
Equitable retirees claimed that company representatives had made promises about the fixed cost of their health insurance, establishing, in effect, a contract with them. The insurance company countered that its benefit plan documents clearly reserved the company’s right to change retiree benefits at any time.
Sears retirees are making similar claims–that company executives assured them their life insurance premiums would always be paid by the company.
Yet the court decisively sided with Equitable. Even if some company executives had given verbal assurances that disagreed with plan documents, such statements are not enforceable if employees have “written materials disclosing the truth,” wrote Appeals Judge David Coar.
It’s the second negative precedent on retiree benefits since Sears retirees filed a series of lawsuits last fall. And because the 7th Circuit is where the Sears suit will be litigated, the Equitable decision carries a lot of weight.
Everett Buckardt, president of the National Association of Sears Retirees, said he is not discouraged by the ruling. “That’s a health insurance issue and ours is life insurance. Our health insurance has always been subject to change,” he said.
Bunny hop: Retailers and manufacturers have been so successful in marketing Halloween-related paraphernalia that some are trying to do the same with Easter. FAO Schwarz, the upscale toy retailer, is in the forefront of this movement, with a glossy direct mail piece that’s pushing much more than cuddly stuffed bunnies. How about a $60 “Barbie Basket,” with a special edition Easter Barbie doll and three Barbie tins filled with candy and stamps?
If dolls aren’t your thing, there’s a $55 Christopher Radko glass ornament featuring an Easter bunny with a basket of eggs on a scooter–for your Easter tree, of course. Or how about a $110 basket of 12 chocolate Star Wars figures for that special little fan?
Wonder what they could do with Presidents’ Day?