MERVYN’S Scott and Miguel

History Founded in 1949 by Mervyn Morris Headquartered in Hayward, CA (Bay Area) Emphasis on family

Strategy Mid-tier neighborhood department store “Trend-right” fashions Home Decor National and private label First to offer revolving credit Ambience of high-end department store with discount prices for families

Target Market Working moms Half of stores located in regional malls, half stand alone

Ownership Private company Sold by Target Corp for $1.65 billion – Target was funneling profits out of Mervyn’s and into new Target stores Sun Capital Partners, Inc. – Private equity firm – Specializes in failing business recovery – Own Sam Goody, Wickes Furniture, Bruegger’s Bagels, Anchor Blue

Downsizing Generated $3.3 billion in revenues (2003) 2003: 255 stores in 13 states 2006: 190 stores in 10 states Exiting Oregon and Washington entirely in 2007 – 19 low volume stores with high operating costs Focus on 171 stores in Arizona, California, Colorado, Idaho, Nevada, New Mexico, Texas, Utah

Community Relations ChildSpree – $100 shopping spree for needy children Sprockets Dog Plush – Sales of stuffed animals funds ChildSpree

Competition Discounters: – Wal-mart – Target – T.J. Maxx – Ross Mid-market veterans: – JC Penney – Sears

SWOT Strengths – Profitable – Well known – Good community relationship – Have a plan – Free of Target Corp leeches – Establishing unique brands

SWOT Weaknesses: – Unstable – Heavy competition from all corners – Must re-establish niche – Bad PR for job loss – Run down stores (pilfering by Target)

SWOT Opportunities – New financing – New leadership – Exploitation of new niche

SWOT Threats: – Competitors – New plan viability – Loss of brand loyalty

Jobs?? Entry level management- – 2004: 300 – 2005: 200 – 2006: 200

References