SUITS GALORE: Jim Doty, the manager of The New York Suit Exchange’s new location in Bartlett, looks over the inventory with suit brokers George Lofton and Maurice McCall. – PHOTO BY TOM WILEMON
The New York Suit Exchange recently took what some might consider a gamble when it opened another store and doubled the number of its employees.
Besides the obvious risk of investing in an expansion during a recession, it also exposed itself to cannibalization. Sales at the new store at 7980 U.S. 64 in Bartlett could have eaten away at the market share of the Downtown store at 310 Union Ave.
But two weeks into the venture, the investment is paying off. Mark Stephens, chief executive officer of The New York Suit Exchange, said sales at the new store have been “beyond expectations” and that sales are also up at the flagship store, which first opened in 1992.
“Certain retailers are doing well that are value priced, which we feel The New York Suit Exchange is,” Stephens said. “Our products are doing well in this environment and are positioned to do better going forward because consumers definitely want to save money. The days of showing your designer suit and boasting what you paid for it are over with. Now, it’s just the reverse by saying how much you saved.”
Multiple benefits
Another benefit of the recession is companies now can negotiate better deals for retail space.
“We’ve been looking at that market for quite some time out there,” Stephens said. “We really couldn’t find the right real estate situation before and we really liked this one. We really didn’t want to be over in the congested area of the other big box retailers on the other side of Highway 64.”
With 22,000 square feet, the store has plenty of space.
“It’s basically like being in a free-standing building,” Stephens said, adding that it attracts walk-in traffic with the Hobby Lobby store on one side and a movie theater on the other.
With the decision to open a second store, Stephens said he gave careful thought as to what areas each location would draw from and mulled over what actions to take to keep from cannibalizing sales.
“As far as affecting the Downtown location, this was as far away as you can get except for going to Nashville, almost,” he said, referring to the Wolfchase Galleria area that is some 20 miles from Downtown. “The Downtown location works well with Arkansas, with Mississippi and Southern Missouri and inside the (Interstate) 240 loop. Our weakness, we always thought, was out there (in the Bartlett/Cordova area).”
Stephens opted to staff the Bartlett store with new employees instead of moving key personnel from the Downtown store. The assumption that a No. 2 or No. 3 salesperson will do just as well in a new location is a wrong one, he said. The New York Suit Exchange now employs about 70 people at the two stores.
Jim Doty, who was hired as the Bartlett store manager, said the location is drawing customers from smaller Tennessee cities as well as the eastern suburbs.
“We really wanted to be able to cater to the customers who live out here who don’t usually visit Downtown,” Doty said. “We’ve had customers from Milan, Covington and Dyersburg. We had a guy from Dyersburg who called his sister in Germantown and said, ‘I want to come down and buy some suits.’ They came in and bought three suits.”
Other opportunities
The New York Suit Exchange opened the store with an advertising blitz promoting three suits for $333, a deal that was available at both locations. Stephens said he thinks this recession will have a longer than usual impact on people’s buying habits. But it might not mean they have to give up designer labels.
“There’s a particular manufacturer here in this country that carries pretty recognizable designer names that would not sell to this company for many years,” he said. “Now, they’ve bent over backward over the last six month to do business with this company. So we’re bringing in their brands in about two weeks into this marketplace.”
The brands will include Ralph Lauren and Calvin Klein, he said.
The New York Suit Exchange is considering a third expansion into the Jackson, Miss., market and already has a particular location in mind, Stephens said. Meanwhile, the company will continue to focus on its online business, which accounts for about 35 percent of sales.
“Right now, the commercial real estate situation is where you can find in all these markets around the country big-box situations,” Stephens said. “We all know that with Circuit City and these big-box companies going out of business there’s an opportunity for companies that are aggressive. We’re an aggressive company and we’re looking to keep expanding and growing our retail base plus our online business.”