SEARS QUITTING BEAUTY SUPPLY.

Byline: Brent Hopkins and Barbara DeWitt Staff Writers

The softer side of Sears got a little too soft.

Citing high costs of operations, the Hoffman Estates, Ill., department store chain announced it will pull out of the beauty business, closing counters at 450 stores nationwide. Sears will also terminate its partnership with Avon, which had planned to bring its new beComing brand into 125 Sears stores in the fall.

It was the overhead, especially the marketing costs of pushing its private label cosmetics, sold under the Circle of Beauty name, that brought the closings even as Sears' competitors bolster their cosmetics counters.

``Actually, the revenues from that area have been fairly good in recent years, but its contribution to the bottom line wasn't as much as we would have liked,'' said Peggy Palter, a Sears spokeswoman. ``Cosmetics are rather expensive, because they depend heavily upon brand name equity. And, historically, Sears has had trouble attracting the recognized names.''

The cuts, which will be phased in over the next year, are part of a companywide review, in which all departments' contributions are analyzed. The review had not yet been completed, Palter said, but cosmetics was the first target. Their small-time numbers were insufficient to justify their existence.

``They were a very small percentage of our overall sales,'' she said. ``Last year, we had $41 billion in total sales, and less than $45 million of that was related to cosmetics.''

Palter was unable to disclose total operating costs for cosmetics, but said the cost of operating the counters, hiring special beauty consultants and establishing Circle of Beauty as a viable brand were significant.

Sears' competitors, however, all cited cosmetics as a strong, healthy business segment, driven by such recognizable names as Maybelline, L'Oreal and Revlon. Some reported not only a continued commitment to beauty products, but also efforts to expand displays.

``While we are aware that Sears will be dropping its cosmetic line and negating its Avon partnership, cosmetics are a $300 million business for us with growth potential,'' said Stephanie Brown, a J.C. Penney spokeswoman. ``As a result of our research we will soon be launching a revitalization effort in our cosmetic departments within the next two months. The counters will have a new look and will include Avon counters in 75 stores throughout the country.''

Jody Cook, manager of public relations for Rite Aid, said its stores are specifically designed with cosmetics in mind.

``It appeals to our core customer, so we're definitely going to continue in the business,'' she said. ``In our newer stores, cosmetics is the first section you see when you come in the door.''

Both Macy's and Wal-Mart reported a similar commitment in maintaining this line of business, which they reported enjoys continued interest regardless of overarching retail trends. Walgreens also plans to stick with makeup, which is a major category in its drugstores.

``Cosmetics are a priority for us, because it's such a strong department,'' said spokeswoman Carol Hively. ``We have specially trained staff, so every Walgreens has a trained cosmetician designated to advise customers.''