Cribs, variety key for specialty stores

Savvy operators of children's specialty stores keep one eye on key trends and fashions while the other monitors their own store's product mix to stay ahead of the sometimes-capricious tastes of their customer base.

Part 2 of Kids Today Specialty Store Operations Survey offers retailers a chance to compare their operations with those of other retailers to fine-tune their merchandise mix, pricing structure and sourcing to put more dollars in the cash register.

Kids specialists generally show a lot of product in a relatively small space — an average of 4,000 square feet of selling space.

Although cribs and other furniture take up the lion's share of selling space and garner the biggest bucks, product variety is the name of the game for the rest of the store — everything from linens and lamps to strollers and DVDs.

Within the furniture category, cribs are tops as the most frequently carried item, closely followed by changing tables, crib mattresses, dressers or chests, toy chests and play tables and chairs. All are carried by 80% or more of the responding retailers. The best-selling price point for cribs hovers at $399. About one-fourth of retailers say their best-selling cribs are priced at $499 or higher.

Opening price points for cribs at kids specialty stores start as low as $69. The median opening price point (meaning half the retailers start lower and half start higher) is $210. About one-third of retailers surveyed put their opening price point for cribs at $279 or higher. Although some retailers limit themselves to a single furniture line, the median number of crib lines carried is four. Slightly fewer retailers carry crib mattresses, with most carrying only one brand. The median opening price for crib mattresses is $75, with $100 being the price at which most are sold.

Dressers, chests and rockers open at slightly higher price points, a median of $300 for rockers and $299 for chests and dressers. The best-selling price point for rockers is about the same as for cribs, a median of $400, but chests and dressers sell best at a median of $499.

Children's apparel is next in the lineup, taking up about 14% of floor space. Apparel accounts for 12% of store transactions, contributing 11% to total sales dollars. About half of the kids specialists surveyed carry infant clothing and layettes. As children grow into larger sizes, fewer and fewer specialists carry clothes to fit them.

The remaining quarter of floor space is split among textiles, gear, decorative accessories, toys, books and games. Textiles, accessories and infant gear each take up 5% to 6% of floor space and pull in 7% to 8% of the dollars spent in the store. Other categories, including bath, safety, feeding and shoes, along with toys/books/games and maternity wear, round out the plethora of products offered. None of these categories registers higher than 5% when it comes to space, sales or store transactions.

In the textiles category, nine of 10 retailers carry crib linens to go with their crib assortment and almost as many carry top-of-bed items — comforters, spreads, duvets and quilts. Prices for crib sets start at a median of $105; the median best-selling price point is $239.

Decorative accessories are also important to the merchandise mix of kids specialists. About three-fourths or more carry lamps and lighting fixtures, mobiles, mirrors and photo frames.

After furniture, gear commands some of the highest price points. The median best-selling price point for both strollers and carseats is $200. Overall, gear adds 7% to the store's sales total.

Toys, books and games are squeezed into about 4% of selling space in most specialty stores and contribute about 3% to the store's sales total. In the toy category, developmental toys, plush and infant/children's books are the most frequently carried items in the category.

Although they limit themselves to two to four lines in most categories (10 of 17 categories), sourcing is a constant challenge for kids specialists. The jury is out on the usefulness of buying groups — nearly equal numbers belong to a buying group as those who do not. Whether or not they use a buying group, nine out of 10 specialists attend trade shows to see product and consider it the most important place to find new items. By far, more retailers say they attend the new ABC Expo than any other. Three-fourths go to that show, compared with 37% who attend the Juvenile Products Manufacturers' Assn. show. About one-fifth each attend either or both the Atlanta gift show or the High Point furniture market.

And while two-thirds to three-fourths say they use Internet search engines and visit manufacturers' Web sites to research new product, neither is viewed as very important in their search for new vendors. Much more important, say retailers, are vendor catalogs and visits from representatives.

Proving that the kids specialty business is never static, three-fourths of the retailers surveyed plan to make some changes in the number of lines they carry. A third plan changes to their price point structure. Faced with stiff competition from mass merchants, eight in 10 are planning to add some lower-priced lines and four in 10 are dropping some of their higher-priced goods. On the other hand, almost half will be adding some products at higher price points.