Mervyns to Open Five New Stores, Launch E-Commerce Site

Mervyns to Open Five New Stores, Launch E-Commerce Site
May 21, 2008

Hayward, Calif.-based Mervyns announced plans to open five new stores, sell certain other locations and launch an e-commerce Web site. Mervyns said it plans to open five new stores in its core markets in 2009, bringing the total number of new Mervyns stores to 17 since the company was acquired by its private-equity owners three years ago. Mervyns reported it has engaged DJM Realty LLC to sell five-10 underperforming stores. The real estate portfolio transition is expected to generate $25 million to $50 million in cash to fund operations and new growth initiatives. The company will launch a fully integrated e-commerce Web site in the fourth quarter of 2008. Mervyns said the e-commerce Web site presents a new growth vehicle and multichannel opportunity for existing and new customers nationwide, and forecasts that the online platform could grow into a $50 million business. These initiatives are the latest elements of a new strategic plan, crafted by new CEO John Goodman, who joined Mervyns in April from Levi Strauss & Co., where he was president of the Dockers brand. Goodman also is focusing the company on providing products and services for key niche markets, especially for Hispanic customers. In addition, Mervyns will enhance community outreach efforts consistent with the company's heritage as a neighborhood department store. This will be accomplished through strategic hires, investments in store-level staff training, as well as targeted sourcing and buying. Mervyns has 177 locations in seven states.