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Bauer fights back

A recent report by Morgan Stanley analysts Matthew Ostrower and Alan Calderon forecasted a grim future for Eddie Bauer. Based on “conversations with REIT executives,” the pair predicted that the Seattle-based retailer would shutter as many as 250 stores next year, mostly in the South.

Although Eddie Bauer closed 43 apparel stores in 2002, executives there argue that the report's 2003 outlook is highly inaccurate. According to Mark Borison, Bauer's vice president of real estate, the company will close only about 20 stores in 2003, and open just as many. Borison adds that southern climates do not necessarily translate to fewer sales: “We've closed stores everywhere, not just in the South, and out of 43 you'd expect that.”

Meanwhile, Bauer is trying to win back 35- to 55-year-old consumers who, according to Bauer brand communications director Michelle Pinson, “have a high brand awareness but may have wondered” where the retailer's identity has gone. The brand is part of the larger, Downers Grove, Ill.-based Spiegel Group, which posted a 17% sales decline for September 2002. Eddie Bauer September sales were down 12%, with comp store sales falling 14% for the same month.

The company has hired Wenham, Mass.-based Mullen Advertising to launch a $12 million advertising campaign, initially focusing on popular outerwear products.

Eddie Bauer operates 364 apparel locations, 100 outlets and 45 home furnishings stores in the United States.

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