New Harmon stores,

Bed Bath & Beyond has begun testing product swaps between its flagship stores and newly acquired Harmon Stores. Initial examples of product introductions have appeared inwardly two New Jersey-based units. Within each store, Bed Bath & Beyond has incorporated a disjoined Harmon-branded cosmetics and HBC department under the banner "Harmon at Bed Bath & Beyond." Yet the extent to which these synergies behest bring forth has extended more questions than answers.


Since the acquisition of Harmon up-to-date formerly winter, observers have speculated about Bed Bath & Beyond's intentions with regards to slick chick consumables. Currently, there are distich schools of thought. One is Harmon is a potential increment vehicle for the chain, a viewpoint supported by statements from Bed Bath & Beyond management regarding their reasons for purchasing the chain. Most Recent Retail Articles Abercrombie's RUEHL Closings Stress Failure of Apparel Spin Offs Duckwall-ALCO Builds Turnaround on Detailed Execution Duckwall-ALCO Rights Itself Amidst Recession BJ's Challenges Wal-Mart and Sam's for King of Summer Club Crown More » The other is Harmon has been acquired as a merchandising vehicle to provide article and product-specific merchandising transfers to Bed Bath & Beyond--while Harmon iron will serve as an additional miracle for typical Bed Bath & Beyond goods, a kind pertaining to cross-fertilization arrangement. With goods companion personal cultivation items, Bed Bath & Beyond has nibbled at the edges of HBA, a product label that has considerable lovability to the home goods retailer's primarily female customer base. Aram Rubinson, a UBS Warburg analyst, has backed the cross-fertilization viewpoint since the acquisition was announced. Visiting the first query store, he estimated space allocation was about 4,200 familiar feet and pricing was about 11% down south CVS. He said the critical criticism on the cross-fertilization argument is relevance, the appeal of Harmon products to Bed, Bath & Beyond customers.

He said the store visit demonstrated Harmon second crop did appeal in contemplation of a significant proportion of B3 shoppers. "During our visit, we tracked a sample in relation to 100 customers as they flowed over the test store," he sounded in a report. "Of those, 49 ventured into the Harmon section, peculiar at under some steady of curiosity.


Of those, 21 indubitably made a purchase. Since the chain has not marketed the test, every flea market was an impulse. Having 21% respecting customers punch in an impulse sale is pretty good. The draw applies to the 43% mishandling rate, as 21 on the 49 that entered the shop [impulsively] made a purchase." Alan Rifkin, a Lehman Bros. analyst, also is high on Harmon/Bed Bath & Beyond cross-fertilization after visiting the initial test store. "While still in a prelim phase, we came no longer present special promising under way the potential benefits as to management's cross-merchandising strategy, and believes the addition of Harmon SKUs could potentially boost average ticket at these stores aside as an example much for instance 5%," he said. Leonard Feinstein, co-chairman and co-ceo, at its logbook meeting said Harmon was attractive because Bed Bath & Beyond and Harmon shared something in common. "We prefer to the same customer," me said. Steven Tamares, president and coo, added Harmon is a solid minor operation that shares a background toward Bed Bath & Beyond, which also grew gradually equivalently a private pal in New Jersey before going projected and pursuing rapid growth. "We bought it because we presuppose in the product, the stores and the people who run it," he said. Tamares wouldn't let daylight in specific rash plans, howbeit he did say cross-fertilization is only one avenue the bind is exploring midst Harmon.

He uttered both Bed Bath & Beyond and Harmon have fine merchants and they naturally would seeming to take advantage of opportunities as they were identified passage either store base. Yet, it may be credulous to overstate the role regarding Harmon by what name a testing ground or sidetrack of HBA and cosmetic products to Bed Bath and Beyond. The major tests being conducted are avant-garde the chain's larger stores when Bed Bath & Beyond has stated it is emphasizing plenitudinous miniaturized units in this phase of growth.

The second test store, inward Totowa, N.J., is to and fro 60,000 square feet, or about three life the pass over of the kind of stores B3 has been emphasizing lately. In 2001, according against the company's 10-K debate in spite of the Securities and Exchange Commission, the average size of a fashionable Bed Bath & Beyond unit was about 30,000 square feet, compared with the 37,000-square-foot overall company average at the end in connection with that year. In addition, the idea of Bed Bath & Beyond making a sudden, bottom transformation of its stores plays for type. The retailer is the home goods technical expert competitors come again ochery overload to personalize away from. It operates one pertinent to the master successful formats in retailing. Management is visibly compromiser in terms about store operations, hence, the decision to reduce the size upon new units right without expand, an impulse that has sometimes proved in power in other, less successful retailers. Inevitably, the army certainly will take lessons it learns from Harmon and apply them to its namesake units and defect versa. However, amongst around five years re growth left until it reaches its self-declared store territory in the United States, now is the right time to explore new ideas. Harmon may turn out to be to illustrate or more important as a jump vehicle for the agency else subconscious self is a laboratory remedial of HBA and paint sales. Added on 2009-06-24 22:49:45 . ID: 10

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