J. CREW TO PHASE OUT CLIFFORD & WILLS Having failed to find a buyer for its ñ74 million Clifford & Wills women’s apparel catalog, cataloger/retailer J. Crew announced on March 3 that it will phase out the title over the next two years. In a statement, J. Crew chairman Emily Woods said that the decision “is consistent with our efforts to continue to focus the company’s management and financial resources on growing the J. Crew brand.”

FRENCH FIRM BUYS BRYLANE French cataloger/ retailer Pinault-Printemps-Redoute S.A. (PPR) agreed on March 10 to buy multititle apparel mailer Brylane. PPR will purchase all of the outstanding shares of Brylane not owned by PPR for ñ24.40 per share in cash, which represents an increase from PPRis initial proposal of ñ20 per share. PPR bought 49.9% of Brylane last year. Brylane becomes a subsidiary of PPRis catalog division, RedCats. As a subsidiary, iweill have greater opportunity to grow quickly, says Brylane chairman/CEO Peter Canzone. This month, in fact, Brylane begins testing a U.S. version of the French womenis apparel book, La Redoute. The book will be distributed in two drops of 700,000 to 800,000 Brylane customers and prospectsoabout a 50-50 mixoin late April and late May. iltis a reduced, 64-page version of the French La Redoute book, Canzone says. The book offers contemporary apparel for the under-35 set. All the merchandise will be directly shipped from La Redouteis French warehouse. Orders will be electronically transmitted to France, shipped within 24 hours to four regional bulk mail centers in the U.S., then shipped Priority Mail to customers. All totaled, customers should received their orders within 5-7 days, Canzone says.

MAIL VOLUME JUMPS In its latest accounting period (AP 5) covering Jan. 2-29, the U.S. Postal Service reports a 3.4% increase in Standard A mail volume compared to the same period last year. Even more striking, however, the USPS posted a 15.3% increase in Priority Mail Volume for the period compared to the same time last year. On the other hand, the agency suffered a 6% drop in Standard B mail, which includes parcel postorecently renamed and repackaged as Parcel Select to reflect a new push for catalogers and other shippers to use zone skippers and the USPS for final delivery.

FURTHERMOREOLandsi End, a ñ1.37 billion apparel mailer, capped a dismal 1998 with a fourth-quarter earnings plunge of 38%. The company earned ñ25.69 million, or 84 cents a share in the quarter ended Jan. 29, compared to ñ41.25 million or ñ1.32 a share for the same period a year ago. Due to an increase in circulation and pages, however, Landsi Endis sales rose 12.64% to ñ541.17 for the quarterO. New J. Peterman owner Paul Harris Stores said on March 12 it will shutter Petermanis Lexington, KY-based offices and three of its 13 stores in Las Vegas; Woodbury, NY; and San Francisco. For more on the acquisition, see story on page 5.

LANDS’ END’S EARNINGS PLUNGE, CIRCULATION CUTS TO FOLLOW Lands’ End, the ñ1.37 billion casual apparel mailer, capped a dismal 1998 with a fourth-quarter earnings plunge of 38%. The company earned ñ25.7 million, or 84 cents a share, for the quarter ended Jan. 29, compared to ñ41.3 million, or ñ1.32 a share, for the same period of the previous year. Worse, annual profits plummeted 51%, to ñ31.2 million, or ñ1.01 a share, from ñ64.2 million, or ñ2.00 a share, for 1997. Due to an increase in circulation and pages mailed, however, fourth-quarter sales rose 12.6%, to ñ541.2 million, while annual sales grew nearly 9%. To reverse the slide in profitability, president/CEO David Dyer said in a statement that beginning in the fall, the company will reduce catalog circulation.


INSIGHT BUYS TREASURE CHEST COMPUTERS On Sept. 14, $800 million, Tempe, AZ-based computer cataloger Insight Enterprises bought $50 million competitor Treasure Chest Computers for $10 million of Insight stock. “Treasure Chest’s Web-friendly customer base fits perfectly into Insight’s strategic growth plan,” says John Lawrence, an analyst with Morgan Keegan & Co. In fact, 20% of Treasure Chest’s sales derive from the Internet. Treasure Chest will remain in New Orleans.

USPS EASES CANADIAN ENTRY The U.S. Postal Service on Aug. 28 unveiled Global Direct-Canada Admail, a partnership with Canada Post. With the service, the USPS will transport catalogs and other direct mail directly into Canada Post’s domestic mail stream, according to James Grubiak, the USPS’s vice president, international business unit. According to the USPS, the program reduces the cost of mailing into Canada 30%.

CHERRY TREE TOYS PRESIDENT HESKETT DEPARTS Larry Heskett, president of Belmont, OH-based Cherry Tree Toys since 1994, resigned during the summer. “I decided more than a year ago that I would come back to my home in Geneva, WI,” Heskett says. “It’s sort of a semiretirement for me; I’m still involved in the business on a part-time consulting basis.” Vice president Matt Simon has assumed Heskett’s day-to-day responsibilities at the $5 million-plus cataloger, which is owned by Chicago-based La Salle Capital.

FURTHERMORE…Clothing catalog/retailer Talbots launched the Talbots Woman catalog of large-size women’s apparel in early September…. General merchandise cataloger Lillian Vernon has hired Richard Randall, a former apparel industry financial consultant, as senior vp/CFO….High-tech gadgets cataloger/retailer Sharper Image Corp. promoted Tracy Wan to executive vp/CFO….Furniture retailer Totem Designs is launching DSGN, a catalog of furniture, lighting, and tabletop accessories, this month.


FULCRUM DIRECT CHIEFS RESIGN Fulcrum Direct CEO Mike Lederman and president/COO Scott Budoff both resigned in mid-June, and as of mid-July, the Fulcrum board had yet to respond to their notices, according to Lederman. Sources familiar with the $80 million Rio Rancho, NM-based multititle apparel cataloger say it’s in dire need of cash, and since Lederman and Budoff resigned, the board has retained New York-based management turnaround team Carl Marks Group to run the company. “In early June, the company determined it needed additional capital to execute its 1998 business plan,” says one source familiar with the company. The board’s New York-based investment banking firm Peter J. Solomon is also considering strategic alternatives such as selling the company. Fulcrum mails the After The Stork, Storybook Heirlooms, Playclothes, Sunskins, Little Feet, Discount Direct and Zoe catalogs, while producing and managing a kids apparel book for Sears.

STRIKE ANYONE? UPS, TEAMSTERS AT IT AGAIN Although a strike is unlikely this time, the Teamsters union, which represents most of United Parcel Service’s workforce, is charging that UPS is violating the contract the two parties agreed to last summer. Under that contract, which ended the Teamsters’ 15-day strike last August, UPS had agreed to convert 2,000 part-time jobs to full-time posts by the end of July 1998. But now, UPS says it will not convert these jobs, because it claims that it’s shipping 467,000 fewer packages a day than it did prior to the strike. “We’ve yet to get back 4% of the business we’ve lost since the strike,” says UPS spokesman Norman Black. “We had been down 7%. But today, we’re employing 10,000 fewer Teamsters than we were a year ago. We’ve told the Teamsters that we look forward to regaining this last 4% and starting to create jobs.” Teamsters spokesman Rand Wilson disputes UPS’s claim that the package carrier has laid off 10,000 Teamsters over the past year. “I have yet to speak with a Teamster who’s been laid off,” he says. “Instead, I suspect that 99% of these people have actually departed through attrition.”

FINGERHUT ACQUIRES PART OF PC FLOWERS & GIFTS In what it promises to be the first of several acquisitions of Internet-related companies, low-end general merchandise cataloger Fingerhut on July 10 bought 19.9% of online floral and gift marketer PC Flowers & Gifts for an undisclosed price. As part of the deal, Fingerhut has the right to buy up to 60% of PC Flowers over the next several years, according to Fingerhut president/COO Will Lansing. Despite its small size ($2 million in sales), PC Flowers gives Fingerhut access to more than 300 companies with Websites that have deals through the PC Flowers site to send flowers in a private-label arrangement.

WEST MARINE FOUNDER/CHAIRMAN TAKES CHARGE Randy Repass, West Marine’s founder/chairman, assumed the role of interim CEO for the boating supplies cataloger/retailer on July 8. He replaced Crawford Cole, who resigned from the Watsonville, CA-based company “for personal reasons,” according to a company statement. Cole will work as a consultant for West Marine.

USPS SPENT $80,000 TO SEE RUNYON OFF When Marvin Runyon left the U.S. Postal Service in mid-May after a nearly six-year tenure as postmaster general, the agency threw two parties at a total cost of $80,000-plus, according to a report in the Washington Post.

FINANCIAL MINI-ROUNDUP Some uppers and downers among catalogers and cataloger/retailers posting mid-summer sales reports: Apparel cataloger/ retailer Talbots’ sales for the five-week period ended July 4 were up 13%, to $117.3 million from $104.0 million for the same period last year. Meanwhile, J.C. Penney catalog president John Cody said in early July that although he expected the retail giant to post low single-digit same-store sales declines for July, the catalog business was “performing very nicely.” He predicted low double-digit catalog sales increases for July. On the other hand, Damark International said its second-quarter numbers would come in significantly below analysts’ estimates of $0.01 earnings per share. Instead, the company expects to post a loss of $0.60 to $0.65 per share and total net revenue for the quarter of $115 million.