Image change at Anderson-Little helps set sales record
Fall River, Mass.
While many of the major retail chains pulled in much higher sales in March, because of Easter buying, holiday sales at Anderson-Little weren't so exciting. On the other hand, Anderson-Little, an East Coast clothing manufacturer and retailer based here, did end the recession year of 1982 with record sales, a production increase of 40 percent, and six new stores. Industrywide, apparel and accessory sales were up by only 3 percent last year from the year before, according to the Department of Commerce.
With only $110 million in sales and a strictly apparel and accessories product line, the company doesn't match the size of Sears or Penney's. But Anderson-Little is an old name in the Boston area, where the firm first started producing men's suits in the 1920s. In the '30s, the company moved to Fall River , one of the major New England textile centers. Since then, Anderson-Little has expanded as far south as Alabama, built factories in Kentucky and Ohio, switched from wholesaling to retailing, and added women's and boys' fashions to men's tailored suits. It is now a subsidiary of Richman Brothers Corporation in Cleveland, itself a subsidiary of F.W. Woolworth.
William Gaudreau, chief executive officer of Anderson-Little, gives the credit for the company's latest boom to its strategy of upgrading its retail image. Before the shopping-mall era, Mr. Gaudreau says, company retail outlets consisted of ''pipe rack'' stores opened in old factory buildings. Merchandise was hung on pipes bought and assembled by the company - not on shiny circular racks.
''When the new malls came in, it was a running battle to try and get a space in them,'' he says. ''The landlords didn't want a pipe-rack operation.''
That situation forced a major change at Anderson-Little, but the rest of the upgrading has been part of a five-year plan to improve its image and expand the number of stores to 125 by 1985.
Since 1981, about a third of the 110 stores have been remodeled. Today, the first thing a customer sees when entering a store is a large ''island'' that displays a whole ''look.'' For instance, everything needed to create the sporty image - sweaters, slacks, shirts, belts, and jackets - are featured on models and shelves on the island. Walkways lead the shopper from one carpeted, spacious department to another, says Lee Sunderland, vice-president and head of marketing.
In the spring of 1981, the firm also came up with its own brand names: Strathmore at the high end, Shefford in the middle, and Southport at the bottom. And it launched ''career'' apparel for women. Mr. Gaudreau emphasizes that the fit is the same in all suits - it's the fabrication that changes with the brand.
This practice, known as ''branding'' turned out to be a good move for the company. ''From zero to 20 percent of your (suit) sales is not too bad in a short two years,'' Mr. Gaudreau says about Anderson-Little's Strathmore line.
''Generally, upgraded stores end up with larger sales volumes and margins,'' comments Ellen Harris, a retail analyst at American General Capital Management in Houston. But, she warns, ''you still have to deliver the value concept. You want more of the middle- middle customers, but without losing your lower-middle customers.''
Mr. Gaudreau admits that doing this ''is something we've been battling with since we conceived these ideas.''
Brand names and remodeling were two ways to upgrade. But other moves were to hire better talent. For instance, the company hired Fred Mitchie away from a division of Hart, Schaffner & Marx, the nation's leading suitmaker, to oversee production and design at Anderson-Little. It also worked on upgrading fabrics and quality control.
While the product has improved, Anderson-Little has still held the price on most of its merchandise. ''We're very proud that we didn't raise prices last year,'' Mr. Gaudreau says. At $199, the firm's top suit, he claims, can compare to a $395 famous brand name.
The quality and price of Anderson-Little suits, plus free alterations on men's and women's suits for the life of the garment, lets the firm compete with the latest trend of off-price, or name-brands-for-less discounters, Mr. Gaudreau says. And, ''these stores don't have the consistency of product, color, and style we have,'' Lee Sunderland says.
The one factor that keeps prices relatively low at Anderson-Little is the very nature of the business. It does its own purchasing, its own manufacturing, its own shipping, and its own selling. There are no middleman expenses, and company products are not sold to anyone else. ''As much as we don't like to use the terminology, we are still 'the factory-to-you,' '' Mr. Gaudreau says.
Anderson-Little has continued to keep a check on its costs as well. ''Through technology and keeping abreast of new methods,'' the firm has cut costs significantly, Mr. Sunderland says. New machinery automates and perfects some of the manufacturing process. Computers keep daily track of inventory and store sales. Computers also determine ways to lay patterns so that the maximum amount of material is used.
The four stories of factory space in Fall River are clean and spacious. Floors have been sanded and refinished, and safety features added. In areas where sewing machines aren't whirring and presses aren't hissing, workers listen to the radio as they work. They fly along at their machines, producing as much as they can make, since they are paid on a piece-rate basis. The executives all walk the factory floor daily, and are on a first-name basis with employees. A company newsletter was started during the winter.
All this ''makes for good productivity and low absenteeism,'' Mr. Gaudreau says. Productivity will increase even further once the 70 people just hired by the firm complete their training, he adds.