The recession has seen many stores shutter in New York, but two value retailers, JCPenney and Nordstrom Rack, are slated to bow in Manhattan in the days and months to come.
JCPenney, the Plano, Texas-based department store, is opening its first Manhattan flagship in Manhattan Mall on Friday, and Seattle-based Nordstrom will cut the ribbon on an off-price Nordstrom Rack unit in Manhattan’s Union Square area next spring.
“It’s a sign of the times — people are looking for cheap, chic [shopping],” said Lizbeth Dunn, a senior analyst at Thomas Weisel Partners. “There’s more of a willingness to shop the value channel, and there are a lot of people in Manhattan who do shop at that price point.”
The new JCPenney will stock a range of branded footwear, as well as some of the company’s exclusives such as Fabulosity by Kimora Lee Simmons. “JCPenney has wanted to have a Manhattan presence because they feel their brand has really evolved, and Manhattan is one of the most important retail environments in the country,” said Dunn, who noted that Manhattan Mall’s proximity to Penn Station will make it appealing to commuters from the outer boroughs and tri-state area.
Executives from the company have said they expect the store to be one of its most productive. To accommodate high traffic, they have equipped the unit with digital tools designed to increase customer service. For footwear, that means scanner communication with the stockroom that requests the customer’s selected style and three additional shoe options.
JCPenney will mark the launch with an event schedule featuring designers such as Charlotte Ronson, Michele Bohbot, Allen Schwartz and Nicole Miller, who create exclusive product lines for the retailer.
Meanwhile, in Union Square, Nordstrom Rack will be located near other discounters, including Filene’s Basement, DSW and Forever 21, a move that company spokeswoman Brooke White said was strategic. “The most successful locations we’re in are surrounded by retail competition, so the more the better. We think that benefits us and benefits our competitors.”
Sterne Agee & Leach analyst Sam Poser said there is huge potential for the new location. “We estimate that Nordstrom does $14 million to $15 million per Rack store, and the traffic in [Union Square] should drive sales well about [that figure]. It may [negatively impact the surrounding stores], or it may bring so many customers to the area that it benefits everybody. It depends how the other guys respond — it could be an opportunity for everybody.”
Nordstrom’s White said the company is still scouting for a Manhattan location for a mainline Nordstrom store and will keep Rack’s opening relatively quiet. “It’s not the same kind of effort that we would go to if it were a Nordstrom store. We don’t want customers to be confused,” she said.