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RETAILERS EXPECT A CONSERVATIVE SECOND HALF.

DALLAS-Mass retailers, bitten by a sluggish economy, are planning their home assortments conservatively for the second half of the year.

And with no hot item or runaway category yet in sight, merchants are sticking to the basics by rounding out core home categories and playing up proven product lines, from General Electric appliances at Wal-Mart to personal care assortments at ShopKo Stores.

That was the consensus among retailers who gathered here for the International Mass Retail Association's annual convention last week.

"The new millennium has not been good to mass retailing," Joe Ettore, chairman and chief executive officer of Ames Department Stores, told attendees on the opening day.

On the flip side, mass merchants are taking comfort in the fact that when the economy is in the doldrums, consumers favor discounters. "Our customer is in a permanent recession," said Cal Turner Jr., chairman and CEO of Dollar General. "So we don't change our strategy [during tough times]."

Nonetheless, Ames, for one, is taking a cautious stance. "We are watching our inventory levels and expenses," said Denis Lemire, Ames president and chief operating officer. However, careful buying should not give way to stale assortments, he added. "Whenever there is a tough economy, you have to give consumers a reason to buy with new items, new patterns," Lemire said.

"We're positioned very well in basic products," said Ettore. "Any of the lower-priced furniture items, such as small tables and magazine stands. It's a sign of the times."

And for the holidays, Christmas dinnerware and imported gift items are expected to ring up sales at Ames. No matter how bad the economy gets, people still buy gifts, Ettore said. "We don't think we've maximized the whole bath spa business, so we're giving it more exposure in our advertising and planogram," said Rick Ausick, senior vice president and general merchandise manager of home at ShopKo. The retailer is also expanding parts of its furniture business with a more stylish mix from vendors such as Sauder and O'Sullivan.

For the make-or-break fourth quarter, ShopKo has high hopes for Salton's George Foreman convection oven and Thanksgiving staples such as large cookware pieces, including roasters and stockpots.

"General Electric appliances continue to be an opportunity for us, as does the entire home business," said Dennis Reaves, Wal-Mart senior vice president and GMM of the GE line that debuted exclusively at the retailer last year. Wal-Mart is now testing GE major appliance shops in about 56 of its stores.

But times are tough on the supplier side, Reaves added. "A number of [home] companies are saddled with debt. We want to help everyone get healthy."
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Author:Thau, Barbara
Publication:HFN The Weekly Newspaper for the Home Furnishing Network
Date:May 28, 2001
Words:437
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