Discount man apparel

The Men's Wearhouse kept charging ahead in the men's tailored off-price arena, while independent haberdashers and superstore chains like Today's Man met reversals. But this outfit's coordinated marketing and high service standards drove growth and earnings at the highest levels in the off-price segment. In 1996, the chain enters East Coast markets for the first time, starting with Boston and Washington.

TJX consumed the Marshalls division of Melville, launching its "Marmaxx Group," operating 1,071 stores under either the T.J. Maxx or Marshalls names at yearend 1995. Projected combined sales in '96 are more than $6 billion--triple that of its nearest direct competitors, Burlington Coat Factory and Ross Stores. Economies of scale will boost productivity and give TJX the pricing power to compete more sharply and consistently against department stores.

Ross Stores outperformed the major players, including T.J. Maxx and Marshalls, and reported record earnings for 95, a tough year in apparel by most measures. The chain's earnings boost was derived from cost control, better gross margin and a store count that grew by 20%.

Ross chairman of the board Norman Ferber will relinquish his ceo title in September 1996, and wants executive vp merchandising Michael Balmuth to replace him. Ferber credits Balmuth and president and coo Mel Wilmore with Ross' success.

Goody's Family Clothing made 1995 a back-to basics year in the executive suite and in merchandising. Harry Call returned as president and coo; Tom Kelly returned as executive vp and top merchant. Earnings moved up, though were still shy of historic highs.

Stein Mart grew its store count by 25% to 100 units. While sales boomed 18%, comp store sales were down 1% and earnings were flat--but the expansion goes on. The chain will reach 121 units by yearend.

The consequences of competition and consolidation forced a variety of strategic course changes:

* Loehmann's rallied with a successful IPO and debt sale in May '96, improving its liquidity. The women's offpricer also recorded its best first quarter ever and is opening larger format stores.

* Filene's Basement retrenched, trimming its store count and logging a 6% comp store sales drop for '95.

* Clothestime filed for Chapter 11 in December '95 and will close up to a third of its locations.

* Today's Man declared bankruptcy in February '96, left the Chicago market and closed 10 of its 35 stores.

* Melville Corp. classified Bob's Stores as "discontinued operations" to prepare for its spin-off, perhaps in 1997.

* 50-Off Stores founder, chairman, president and ceo Chuck Siegel resigned in May '96. After a disappointing year, the chain secured new financing and looked to reposition under ceo Charles Fuhrmann.

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RELATED ARTICLE: OUTLOOK:

Differences will grow starker between the least and best focused chains. Expense reductions and a purer off-price mix will boost earnings at $6 billion giant T.J. Maxx/Marxhalls. Extreme divergence is also evident in the men's tailored subsegment, where The Men's Wearhouse will exploit new locations in the Northeast, but Today's Man struggles though bankruptcy with 28% fewer stores than a year ago. The rule going forward will be more aggressive--but disciplined--markdowns and inventory control, and the increased reliance on buyers' savvy that implies.