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C ON T A C T S Publisher and Group Editorial Director Murray Forseter (212) 756-5257 mforseter@ chainstoreage.com
Associate Publisher National Sales Manager Gary Esposito (212) 756-5118 gesposito@ chainstoreage.com
Editor Marianne Wilson (212) 756-5261 mwilson@ chainstoreage.com
Associate Editor/ Web Editor Samantha Murphy (212) 756-5094 smurphy@ chainstoreage.com
Assistant to the Publisher Rita Ruzalski (212) 756-5268 rruzalski@ chainstoreage.com
National Conference Director Mary Fagnano (323) 860-6308 mfagnano@ chainstoreage.com
National Sales Manager—Technology Michael Morrissey (312) 645-5072 mmorriss@ chainstoreage.com
Online Sales Managers West Coast Adrine Antonian (323) 860-6390 aantonia@ chainstoreage.com East Coast Risa L. Serin Tel (212) 756-5267 rserin@ chainstoreage.com
Regional Sales OfFices New York
425 Park Avenue New York, NY 10022
Chicago
444 N. Michigan Ave., Suite 1070 2427 Copper Creek Rd. Chicago, IL 60611 Chester Springs, PA 19425
Philadelphia
Los Angeles
Associate Publisher National Sales Manager Gary Esposito Tel (212) 756-5118 Fax (212) 756-5120 gesposito@ chainstoreage.com
Regional Sales Manager— AL, AZ, FL, GA, ID, IL, MN, MS, MT, ND, NM, NV, SD, UT, WY, Western Canada Michael Morrissey Tel (312) 645-5072 Fax (312) 644-3256 mmorriss@ chainstoreage.com
Eastern Regional Sales Manager— CT, DC, DE, MA, MD, ME, NC, NH, NJ, NY State, PA, RI, SC, VA, VT, WV, Eastern Canada, Puerto Rico, Virgin Islands, Outside U.S. Lise Slaviero Groh Tel (610) 458-7655 Fax (610) 458-7654 lslaviero@ chainstoreage.com
Regional Sales Manager— AK, CA, HI, OR, WA Mary Fagnano Tel (323) 860-6308 Fax (323) 465-4287 mfagnano@ chainstoreage.com
Area Manager Real Estate Advertising Manager Online Sales Manager — East Coast NYC, Long Island, and all Shopping Center Developers and Real Estate Companies Risa L. Serin Tel (212) 756-5267 Fax (212) 756-5279 rserin@ chainstoreage.com
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Regional Sales Manager— AR, CO, IA, IN, KS, KY, LA, MI, MO, NE, OH, OK, TN, TX, WI David A. Stewart Tel (312) 645-5078 Fax (312) 644-3256 dstewart@ chainstoreage.com
a v e n u e
606 N. Larchmont Blvd., Suite 206, Los Angeles, CA 90004
Online Sales Manager Adrine Antonian Tel (323) 860-6390 Fax (323) 465-4287 aantonia@ chainstoreage.com Online Sales Coordinator David Scoles Tel (323) 860-6320 Fax (323) 465-4287 dscoles@ chainstoreage.com
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BEHIND EVERY BUYING DECISION, THERE IS A CHAIN OF INFLUENCE 001_R1_csa_11_08_cover
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Page 1
Volume 84, Number 11
CHAIN STORE AGE
®
THE NEWSMAGAZINE FOR RETAIL EXECUTIVES
NOVEMBER 2008
A LEBHAR-FRIEDMAN® PUBLICATION www.chainstoreage.com
Romancing The Stone
Diane Irvine, CEO and president, Blue Nile
CHAIN STORE AGE
Jeweler Blue Nile Makes High Performance Retailers Debut p. 29
TECHNOLOGY Localized Assortments Key in Rough Economy p.53 LIGHTING United Supermarkets Cuts Energy Costs p. 82 REAL ESTATE Urban Development p. 101
The retail market is a moving target.
NOVEMBER 2008
From real estate, store planning and outfitting to technology, management and operations, who decides what’s in and what’s out? Ultimately, it’s not any one person, but the collective judgment of hundreds, even thousands of industry executives — a chain of influence — that determines whether your products or services fit their plans.
Chain Store Age is the strongest link in that chain. Since 1925, retailers have turned to Chain Store Age first for the information they need to make the smartest decisions about capital expenditures. Today, we’re extending our lead as the #1 source of news, knowledge and networking for professionals in the multi-trillion dollar retail marketplace.* Online, in print and at events, Chain Store Age will build your business and your brands.
PERIODICALS
*Source: LewisClarkBoone Retail Industry Survey, May 2008
TRILLIONS OF DOLLARS ARE iN PLAY EVERY DAY
Whether the retail market is up or down, the scale is big and the stakes are high. Capital spending on building products, services, technology, systems and support can have a significant impact on a retailer’s bottom line.
Only Chain Store Age connects you to the influencers who control capital expenditures in store planning, technology, management and operations. And not just in one category — every category. Our readers specify and buy your products.
Chain Store Age 2008 Top 100 U.S. Retailers (August 2008)** Apparel Stores
3.0%
Warehouse Clubs
6.8%
Supermarkets
19.1%
$1.7 trillion annual revenues
Convenience Stores
2.8%
Department Stores
6.6%
Discount Store
5.1%
Drug Stores
8.1% Supercenters
14.2%
Shoe Stores
0.5%
Military Exchanges
1.1%
Mail Order
0.7%
E-Commerce
2.6%
Hard Lines Stores
12.0%
Home Centers
8.1%
International Operations
9.3%
**Source: Chain Store Age, Top 100 Retailers, August 2008
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A CHAIN OF INFLUENCE SUCCESS STORY CSA_may_p1_cover
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Volume 84, Number 5
CHAIN STORE AGE
CO IC NV SC EN an ® TIO d F NS MI IS SU E
AWARENESS + EDUCATION = LEADS
THE NEWSMAGAZINE FOR RETAIL EXECUTIVES
MAY 2008
www.chainstoreage.com
A LEBHAR-FRIEDMAN® PUBLICATION
REAL ESTATE Fastest-Growing
Developers, Acquirers and Managers p. 43 RETAIL TECHNOLOGY QUARTERLY Focus on Supermarket Technology p. 127 SPECS/2008 Wrap-Up Coverage p. 165
CHAIN STORE AGE
REINVENTING SHOPKO Chairman/CEO Michael MacDonald Talks Strategy p. 156
MAY 2008
PERIODICALS
THE RETAIL MARKET AT A GLANCE • $4 trillion-plus annual revenues • More than 850,000 stores are operated by chain-store companies
Some of our most strategic and forward-thinking customers are leading retailers with long global supply chains. Chain Store Age helped us “evangelize” our benefits to this audience — lower risk, lower cost, faster time to value and market/retail traction — with a fully integrated program including targeted ads, a custom e-newsletter, advertorials, research analysis and events. As a result of this work, awareness of our company has increased, and we’ve received more qualified leads.
Greg Kefer Director, Corporate Marketing GT Nexus
• Nearly 8,500 chainstore companies operate five units or more • In 2009, retailers are expected to invest more than $200 billion in capital development and improvements Including: • buy, install or upgrade technology systems • outfit more than 37,000 stores • maintain or remodel more than 800,000 older units • build new distribution systems • streamline supply chains
As seen in Chain Store Age
EDITORIAL THAT’S RELEVANT, ENTERPRISING AND TRUSTED From the corner office to every corner of the store, original, premium content makes Chain Store Age the first choice
for news, insight and analysis of the industry.* A spring 2008 survey of retail headquarters executives (industry-wide, not just
our subscribers!), named Chain Store Age the most read, most useful, most important magazine in the business.
READERSHIP STUDY (MAY 2008)* CHAIN STORE AGE Romancing The Stone
RECEIVED
MOST USEFUL
PRIMARY PUBLICATION
READ REGULARLY CHAIN STORE AGE
25 The
78%
Most Influential People in
Retailing
CHAIN STORE AGE CHAIN STORE AGE THE VISIONSOFFUTURE
26%
15% 14%14%
54%
53%
33% 26%
65%
26%
24% 22%
19%
15% 14% 14%
15% 11% 6% 6% 4% 4% 4% 4% 4% 4% 2% 2%
5% 5% 5% 5% 2% 2% 2% 0%
8%
13% 14% 14% 10% 8%
15% 11% 10% 6%
2%
*Source: LewisClarkBoone Retail Industry Survey, May 2008 CSA_oct_p1_cover
9/15/08
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Volume 84, Number 10
CHAIN STORE AGE
®
TOTAL COVERAGE. TOTAL AUDIENCE.
THE NEWSMAGAZINE FOR RETAIL EXECUTIVES
OCTOBER 2008 www.chainstoreage.com A LEBHAR-FRIEDMAN® PUBLICATION
CHAIN STORE AGE
Rear Admiral Robert J. Bianchi, Commander, Navy Exchange Service Command
RETAIL TECHNOLOGY QUARTERLY Focus on Workforce Management p. 45 SIGNAGE Wal-Mart’s New Digital Network p. 70 OCTOBER 2008
REAL ESTATE SUPPLEMENT Mixed-Use Centers p. 87
Chain Store Age delivers the total audience — more influencers, more ways, more often than any competitor.
Our network of websites, print publications, e-newsletters and events connects you with every level of the retail marketplace: • Market professionals who want to know • Industry stakeholders who need to know • Business executives who have to know.
PERIODICALS
What that means to you is more opportunities to attract and hold the attention of your customers and prospects, wherever and whenever they’re ready to make a capital investment.
4
A CHAIN OF INFLUENCE SUCCESS STORY
FIRST CHOICE FOR REACHING DECISION-MAKERS KEY: Chain Store Age Design & Display Ideas Intergrated Solutions for Retailers Internet Retailer Retail Construction Magazine Retail Traffic RIS News
Westwood has been an advertiser in Chain Store Age for many years. Early on, we learned that CSA was the trade publication most read by our key target audience – retail construction decisionmakers. Since our construction services are primarily retail-focused, communicating our message through the “industry standard” for retail was and, still is, the correct means for us. CSA offers large distribution and is highly targeted making it an efficient buy for us.
Shopping Center Business Shopping Centers Today STORES
Visual Merchandising and Store Display Women's Wear Daily
CSA is very flexible and accommodating to our various advertising needs which helps us to consistently reach and exceed our communication goals. CSA will continue to be the cornerstone of our advertising activity.
Robert D. Benda CHAIN STORE AGE READERS TAKE ACTION:
Chairman and Chief Executive Officer Westwood Contractors, Inc.
• 69% visited a Web site • 67% contacted supplier for a meeting
CONTINUED FROM PREVIOUS PAGE
freestanding retailers in the pharmacy industry and other large-box retailers, and premier department stores as well as our presence in restaurant and hospitality. And while we don’t disclose specific financial data, we were recently ranked by the Fort Worth Business Press as one of the Top 100 privately owned companies in Tarrant County (Fort Worth area).
• 67% referred ad or article to a colleague
CSA: How does being a retail general contractor differ from catering to other industries? RB: The biggest difference between a contractor who focuses successfully on retail construction and other general contractors is probably the ability to creatively overcome challenges to meeting contract completion dates. In retailing, the store opening date is sacred. Therefore, regardless of lease execution delays, permit issuance delays, weather delays, or many other factors beyond the control of retail contractors, we are expected to make that date. Companies who consistently find ways to do that are the ones who receive repeat business.
• 46% used an idea found in an ad or article
In addition, those of us who work nationally have developed resources and systems to export our project management services across the country, something that most general contractors outside of retail are not comfortable with.
• 36% saved the ad or article for reference
CSA: How has prior retail experience impacted your ability to partner with current retail clients? RB: For the first 17 years of my career, I worked in a variety of merchandising, operations and executive positions with national retailers. This experience gave me a keen understanding of what comprises an effective contractor from a retailer’s perspective
• 24% recommended the purchase of a product or service • 22% visited supplier at the next trade show In all, 71% of readers took action based on an ad or article in Chain Store Age!*
s Building on Trend
and the business reasons behind that perspective. I think it helps when you understand that store completion dates are sacrosanct for specific business reasons, not because the client is simply demanding. It helps to understand that finish quality and execution are important because the built space is part of the client’s brand image, not because the client’s owner rep is having a bad day. CSA: Which retailers have impressed you the most over the years? RB: The reason that I enjoy our role in retailing is that we get to constantly see creative new ideas put into action through our clients and other emerging retailers. We have really been impressed recently with the leadership of clients like REI and Wal-Mart, who are pursuing corporate initiatives to integrate green thinking into their culture. We believe that this emerging trend of retail market leaders committing to green initiatives as a corporate commitment of social responsibility will significantly accelerate acceptance of these standards throughout the industry. CSA: From a general contractor’s standpoint, what do you see as today’s most cutting-edge technologies? RB: Wireless technology has had a significant impact on our industry, facilitating connectivity with our field staff. Moving forward, one of the biggest opportunities for increased productivity and quality improvements will result from the integration of project collaboration applications more fully into the creation of the built environment. Most of us have transferred existing processes into collaborative web-based project management systems but the real benefits will come when users develop new processes that are made possible by these tools. The time and cost of the traditional model—where an owner rep spends a lot time on a plane personally visiting projects—can be used in different ways.
CSA: What do you think s, retailers pay and general contractors Contractor wood can do to become better partners? and executive of West past, present man and chief a look at the rt Benda, chair RB: Our job is to execute as directed by our client. I would anniversary with CSA and Robe company’s silver say, however, that I am a strong advocate for developing tribute to the contracting. ral and with the design and als, gene materi d collaborative vendor relationships retail future of for owner supplie
g procedures construction staff. all parties early in the process and team. ionsInvolving protocol, handlin off to the operat for the handsharing the objectives of the organization makes it possible defined protocols s the for vendors to make informed decisions based on a contextual change, which involve tivity third majorunderstanding theproduc mission. e the increasof That has led to the logy solutions that l aspects of the physica utilization of techno the e team to manag me very redretail CSA: Wherestaff do you think is headed? conside of the entire project ago, the Westwood we utilize a Robert Benda, project. Twenty years a fax machine. Today, the entire CEO, I invested inRB: when allow At least in America, I believe that shopping is much Chairman and that ssive ns progre logy solutio of techno Westwood more than the process of obtaining goods or services. It comprehensive suite a real-time basis. Contractors, Inc. be connectedis on entertainment, therapy, socialization, adventure … an project team to ing of shorten the the is important part of ourfrom life experience. Retailers will continue to s. The first change will come three major change ts. It was not unusual 20 next major to retail.experiences for consumers the ethic g invent new ways to provide inviting ahead, RB: I would cite g buildin Lookin for of the green cycle” for retail concep its built and application s to used as they purchase goods and services which result in a profit Westwood livespace webcams on-site during the the “product life tanding unders to not make change the most successful responded for the retailer. Thisand creativity goes beyond the retailers flagship store on Rodeo Drive. years ago for a retailer lease.construction Today, we seeof the bebe grown with— n of the signage, Westwood themselves to the developers who provide the platform for the entire duratio new feature areas, CSA: How has g their stores with a retailer will ? retailers updatin more likely that to—these trends basis. It is also much ve years and, when it does, ctive on what etc., on a yearly three to fi a retailer’s perspe in had design t always ound in retail update its concep RB: Westwood has tor due to my backgr existing store base. contrac our of entire retail the ound t good retrofi makes a ction backgr involves the retail constru with the d over the years management and us to keep pace that has occurre This has allowed requiring ined about The second change executive team. Westwood_CSA4pgFINAL508.indd 2 4/8/08 10:59:53 AM much more discipl Twenty years g needs. retailers becoming contractor base. industry’s evolvin ses across their you just , Wash., St. Paul, standardized proces much care how you got there; four offices: Tacoma didn’t t completion date. Fort Worth, Texas. ood has grown to in ago, most clients contrac Westw arters the on store over and our headqu s, ency. The most needed to turn the Minn., Raleigh, N.C., a large number of specialty retailer ptable level of consist specific process unacce an to NEXT PAGE This often led have a very Current clients include CONTINUED ON s milestone we work with today evolved retailers tors use. This include billing insist all contrac control processes, model which they assurance and quality reporting, quality congratulations CSA: First of all, 25th anniversary. on Westwood’s on your two As you look back ood’s helm, decades at Westw you seen have what changes have they in retail and how as a general role your impacted contractor?
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Over the past 25 years, we have tried to build our integrity, stewa company, produ rdship, innovation ct, and reputation and loyalty. To doing business. through: qualit us, these princi Going forward, y, ples represent with the contin The Westwood curren ued partnership t silver their stores. Just as lifestyle centers have earned a place Way! of anniversary accom of great retailers, plishm we plan to build alongside the regional malls developed in the ‘60s, ‘70s and ents: upon our ‘80s, new venues for retailing will emerge to address the s (IGHLY REGARDE lifestyle preferences of tomorrow. D AS ONE OF THE T OP NATIONAL GEN ERAL CONTRACTORS s next #ONSTRUCTION SERVIC IN THE 53 CSA: Where do you see Westwood going in the ES EXPERT IN TENAN GROUND UP PRO 25 years? T IMPROVEMENT JECTS AND RENOV l NISH OUT FREES ATION WORK TANDING s 4HO RB: When I first came to Westwood, the goal was to feed USAND my S OF COMPLETED PROJE CTS FROM #ALIFOR family and the other families that count on Westwoodand for ain every state in between NIA TO -AINE !LA living. You don’t sit back and daydream about the day you SKA TO &LORIDA s )NDUSthe reach the 25th anniversary of the organization but—given TRY TECHNOLOGY SOLUT IONS INNOVATOR statistics of small business formations and failures—25 years proje ct management LAPTOPS DIGITA software, McGr L CAMERAS "UZZS is a milestone we’re extremely proud of on behalf of the entire aw-Hill bidding AW s &OUNDING