THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, March 29, 1996 TAG: 9603290610
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY STEPHANIE STOUGHTON, STAFF WRITER
LENGTH: Medium: 60 lines
Best Products Co., the Richmond-based home furnishings and jewelry retailer, on Thursday announced plans to close 10 stores, back out of nine new lease agreements and get rid of its giant catalog.
The elimination of Best's fall catalog, which has been around since 1957, will be the most noticeable change for shoppers. The company's catalogs, about 500 pages each, will no longer be mailed to customers or placed in the showrooms.
At Best stores, most shoppers make a beeline for the catalogs to pick out their merchandise. Once the catalogs are removed, they'll have to choose their products in a more traditional retail manner - from displays.
``It's a major shift,'' company spokesman Ross Richardson said.
The savings will allow Best to launch a new broadcast marketing program. The company will still keep its smaller holiday and spring catalogs, which are more like fliers.
On Thursday, the struggling chain announced store closings for Northern Virginia, North Carolina, Ohio and Maryland. Specific locations were not available.
``There are no plans to close any Tidewater stores at this point,'' Richardson said. ``The Tidewater area has been a very good market for us.''
The company has three traditional outlets and one jewelry store in South Hampton Roads.
As part of its reorganization, Best took a $45.7 million restructuring charge in fiscal 1995 to cover the costs of closing the stores, backing out of lease arrangements and making accounting changes.
Best, which has struggled against retailers like Wal-Mart and Target Stores, emerged from bankruptcy protection in June 1994. Since then, it has fought to transform itself into a successful retailer.
Earlier this month, Chief Executive Officer Stewart M. Kasen announced plans to help reposition the company and then depart, himself, as part of the restructuring.
``This will be a year of significant transition for Best Products,'' said Kasen, who is helping in the search to replace him as Best's chief executive.
Kasen said Best Products would ditch product categories that haven't been successful. They include bicycles, some sporting goods, home office electronics, automotive electronics, video games and selected toys.
Best also wants to make its stores more customer friendly by placing a greater number of staffers on the sales floor.
Best Products operates 175 Best stores, 11 Best Jewelry stores and a nationwide mail-order service.
The company lost $95.7 million, or $3.03 a share, in the year ended Feb. 3, 1996. That compared with a profit of $23.3 million, or 73 cents a share, for fiscal 1994. Meanwhile, sales declined 2 percent, to $1.5 billion, in fiscal 1995.
For the fourth quarter of fiscal 1995, the company lost $74.7 million. That compares with a profit of $29.9 million in the year-earlier period. by CNB