Belk is busy bulking up. Already the nation's largest privately owned department store chain, Belk now operates 300-plus stores in about 15 states, following its purchase of the Parisian chain from Saks. Previously, Belk acquired Saks' McRae's and Proffitt's divisions. Belk stores are located primarily in the southeastern (the Carolinas, Florida, and Georgia) states and offer mid-priced brand-name and private-label apparel, shoes, jewelry, cosmetics, gifts, and home furnishings. Its stores usually anchor malls or shopping centers in small to midsized markets and target 35-to-54-year-old middle- and upper-income women. Founded in 1888 by William Henry Belk, the Belk family still owns and runs the company.
Belk's store operations are organized into three operating divisions, with offices in Raleigh, North Carolina, Atlanta, Georgia, and Birmingham, Alabama. Subsidiary Belk Store Services provides a wide range of services, including administration and merchandising planning and allocation, to the three division offices. In addition to its retail stores, the department store chain operates a growing e-commerce business belk.com (relaunched in 2008).
Belk's revenues increased 5% in fiscal 2012 (ends January) vs. the previous year to $3.7 billion, aided by a 5.5% increase in same-store sales, partially offset by a nearly $7 million decrease in sales due to two closed stores. The chain's performance closely mirrored that of fiscal 2011, which saw similar gains vs. the prior year. The back-to-back years of sales and profit growth, reversed two consecutive years of negative comparisons as the retailer lost sales to discount chains during the recession. Net income grew by 43% in fiscal 2012 vs. 2011, reflecting higher sales and better margins, among other factors.
Declining consumer spending during the great recession brought a decade of expansion -- driven primarily by acquisitions from Saks -- at Belk to a halt. Rather than increase its store count, Belk has focused on remodeling and expanding existing stores, developing new merchandising concepts, and enhancing its online business. As a result, it's become a more efficient retailer, with store sales per square foot increasing from $143 in fiscal 2010 to $162 in 2012. In fiscal 2012 the company closed two stores in Florida, yet increased its overall sales. Belk's updated image campaign (launched in 2010) under the tagline: Modern. Southern. Style is meeting with some success. After completing major remodeling projects at seven of its stores in fiscal 2012, the company is looking to complete four store expansions and two stores replacements for existing stores in fiscal 2013. Like its competitors Macy's and J.C. Penney, Belk has focused on exclusive private-label merchandise to attract and retain customers. The retailer also launched its own fine jewelry business under the "Belk and Co. Fine Jewelers" name and operates jewelry departments under that brand in about half of its stores. Also like Macy's, Belk has undertaken a strategic initiative to improve its merchandising and planning organization to make it more responsive to local markets.
The Belk family owns the majority of Belk stock. – less
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