Nordstrom Inc. (JWN - Analyst Report) has decided to shutter its Rack store at Florida Mall in Orlando, FL. After enjoying nearly 12 years of patronage from the customers of Orlando, this store will cease operations from Aug 16, 2014, which is the store’s lease expiry date.
Closing the store will impact approximately 190 non-seasonal employees. The company stated that it will put forth its utmost efforts to employ them at its other Rack stores. However, for employees who cannot be accommodated at any other stores, Nordstrom will offer a severance package.
Though the company has the rights to renew the lease agreement, it does not want to operate its Rack store at this mall anymore due to its underperformance. For the Florida Mall store to return back on track, huge amount of investment is required, but Nordstrom does not think it is worth the risk.
Nordstrom highlighted that their patrons will receive continued services from the nearby Nordstrom Rack store located at Millenia Crossing. Currently, the company operates ten Rack and eight full-line stores in Florida.
Nordstrom is going to open two new Rack stores in the state, which are to be located in West Palm Beach and Lake Brandon, schedule to inaugurate on Oct 9 and Oct 30, respectively. Apart from this, the company will open a full-line store in the state, at St. Johns Town Center in Jacksonville on Oct 10, 2014.
Nordstrom’s Rack stores generally offer merchandise from Nordstrom stores and Nordstrom.com at a significantly reduced price to customers. Products at these stores are sold with discounts of roughly 50% to 60% from the original Nordstrom tags. Nordstrom Rack also carries a vast assortment of branded apparel, accessories and shoes that are available at Nordstrom stores, and are offered to customers at a discount of about 30%–70%.
The company mainly focuses on omni-channel growth strategy to boost its top and bottom line performances. Nordstrom’s focus on store expansion is evident from the series of Rack store openings since the beginning of fiscal 2014. Its latest store opening at East Bay Bridge Shopping Center, Emeryville, CA signifies the company’s commitment toward strengthening its network with an aim of driving top-line growth.
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Currently, Nordstrom carries a Zacks Ranks Rank #2 (Buy). Some better-ranked apparel/shoe retailers include Christopher & Banks Corporation (CBK - Snapshot Report), Citi Trends, Inc. (CTRN - Analyst Report) and The Men’s Wearhouse, Inc. (MW - Snapshot Report), all carrying Zacks Rank #1 (Strong Buy).