Kohl's To Cut '09 Store Openings, To Emphasize Exclusive Brands

Kohl's Corp. (KSS) said Wednesday it will cut its 2009 new store openings to 50 from 90, but sees the money saved as aiding opportunities for expansion from coming "consolidation" in the retail industry. "We are keeping our powder dry" for consolidation of retailers and retail outlets that will come in the next few years, or as soon as "the next six months," said Kohl's Chairman Larry Montgomery.

Montgomery, who relinquished the title of chief executive to Kohl's President Kevin Mansell last month, spoke in New York City at a retail conference sponsored by Goldman Sachs.

Kohl's said last year it would have 1,400 stores by 2012, but now isn't expected to reach that number as soon. Montgomery did not give a timeframe.

As for the 50 openings for next year, "We want to be prudent" given economic conditions and also have cash on hand for opportunistic acquisitions, Montgomery said.

The company also plans to play up its exclusive lines from designers like Vera Wang and introduce new ones. Its own private-label products are also going to be a focus.

Both exclusive and private-label lines generally carry higher margins than branded products from outside companies.

When it comes to producing its apparel, Kohl's plans to be nimble by doing more in Vietnam and Central America as inflation in China grows, Montgomery said.

He added that Kohl's also plans an early start to its holiday promotion season in the U.S.

Source: Morningstar.com