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For Bloomingdale's, gains could come in small stores

The department store chain is considering the use of a reduced-size format in new markets.

January 27, 2007|From Bloomberg News

Bloomingdale's may expand the 37-store chain by opening smaller stores in new markets, Chairman Michael Gould said Friday.

Bloomingdale's may open stores that are 150,000 to 180,000 square feet, compared with its average of 225,000 to 240,000 square feet, in markets that include Arizona, Nevada and Florida, Gould said. He declined to specify the number of stores or the timing.

Bloomingdale's is the smaller of two chains owned by Cincinnati-based Federated Department Stores Inc., the nation's second-largest department store company after Sears Holdings Corp.

The possible expansion of Bloomingdale's is motivated by the success of the smaller, 84,000-square-foot store the chain opened in New York's SoHo district 2 1/2 years ago that focuses on contemporary women's sportswear, Gould said.

"There's an opportunity there with different size stores in other markets," he said. "What SoHo has taught us is that there may be other formats in these other markets that may be profitable for us."

Bloomingdale's opened three traditional stores last year and plans two more this year, Gould said.

Federated also operates more than 800 Macy's department stores after converting about 400 former May Department Stores Co. locations to the nameplate in September. Federated bought May in 2005 for $11 billion.

Shares of Federated rose 45 cents, or 1.1%, to $40.27.

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