
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, November 9, 1994                   TAG: 9411090027
SECTION: BUSINESS                    PAGE: B-7   EDITION: METRO 
SOURCE: Chicago Tribune
DATELINE: DALLAS                                LENGTH: Medium

SELLING MORE CLOTHES CALLED CRUCIAL FOR SUCCESS OF SEARS' TURNAROUND

A year-old advertising campaign promoting apparel is changing attitudes about Chicago-based Sears, Roebuck and Co., according to a Sears executive.

While sales at the company's stores are growing at about a 5 percent rate, apparel sales are growing significantly faster than that, said Arthur Martinez, Sears Merchandise Group chairman and chief executive officer.

``They're growing at a high single-digit rate,'' said Martinez, who credited the company's ``Softer Side of Sears'' campaign for raising awareness about the firm's apparel offerings.

Martinez was the opening speaker for a retailing conference sponsored by the Center for Retailing Studies of Texas A&M University.

Despite the strong growth, however, Martinez said apparel sales still account for only 28 percent of the group's total. He said he still thinks the group can increase clothing sales to 40 percent of total sales by fiscal 1997-98.

Boosting apparel sales is crucial to the long-term success of the Sears turnaround that Martinez engineered, because the segment accounts for 60 percent of the group's profits.

In January 1993, Sears, which had been floundering for years, took a $2.5 billion charge to earnings as it closed 113 department stores and dozens of specialty stores, eliminated 50,000 jobs and shuttered the company's 105-year-old ``Big Book'' catalog.

While Martinez didn't reveal any new strategies, he did say he's pleased with sales growth, even though it is running below the double-digit level of a year ago. He added that he is confident third-quarter earnings, which will be released this week, will be strong. Sears' earnings for the second quarter rose 22.6 percent from the year-earlier period.

Apparel sales growth is being driven in part by expanded offerings that include higher-priced items.

``In dresses, for instance, we still have the $29.95 opening,'' he said. ``But we've expanded the upper end to $59, $69 and even $79. We're finding we're selling more at that price level without affecting sales of the opening prices.''

by CNB