Stein Mart's style is to operate department-like stores that feature discount prices. With more than 260 shops in some 30 states, it sells off-price women's, men's, and children's brand-name clothing. Fashions range from casual to formal. Stein Mart also sells jewelry, handbags, linens, home decor, and gifts. Independent firms lease Stein Mart's shoe and fragrance departments. Its upscale women's boutiques are sometimes staffed by socialites who work part-time to receive employee discounts. Russian immigrant Sam Stein founded Stein Mart in the early 1900s. The company had one store in Greenville, Mississippi, until 1977, when it began growing rapidly. Chairman Jay Stein, the founder's grandson, controls Stein Mart.
Florida-based Stein Mart serves customers in about 30 US states, primarily in its home state of Florida, as well as in Texas, California, and North Carolina.
Stein Mart offers customers merchandise found in better department stores and specialty stores. Unlike other retailers who peddle discounted apparel and accessories, the company offers a merchandise locator services, a Preferred Customer program, co-branded and private-label credit card programs, and electronic gift cards.
Sales and Marketing
Stein Mart's advertising expenses have remained relatively steady in recent years. It spent $54 million on advertising in 2013, up slightly from $52.4 million in 2012 and $56.6 million in 2011.
To maintain traffic in its stores, the retailer lures customers with full-color circulars that are inserted into newspapers and mailed directly to homes. It also leverages direct mail, newspaper run of press advertising, and email to distribute its sales promotion messages. Stein Mart boosts brand awareness through television and radio ads. Online, the company taps digital media vehicles, such as online advertising and social networking sites the likes of Facebook and Twitter.
While Stein Mart logged a decrease in the number of transactions in fiscal 2013, the company posted $1.26 billion in revenue, a 3% increase vs. 2012's $1.23 billion. Giving the retailer's revenue a bump were rising average units per transaction and average unit retail prices. Comparable store sales during the reporting period saw a nearly 4% boost, as well, as total sales rose more than 2%. Net income also increased -- some 2% -- in 2013 to $25.5 million from $25 million in 2012, as cash flow from operations dropped $31.3 million from $71.3 million in 2012 to $40.1 million in 2013.
While the company is taking a conservative approach to growth, Stein Mart aims to maintain its presence in the southeastern US and in Texas. During fiscal 2014, the retailer plans to open 10 stores, close two stores, and relocate six other stores to better locations. (The chain is looking to strengthen its real estate portfolio in current markets.) In fiscal 2012, the company quit the Washington, D.C. market, after abandoning Iowa the year before.
Stein Mart in 2013 became one of the first off-price retailers to launch its own online store, which focuses on current season, brand-name fashion apparel for women and men, as well as accessories, linens, and home decor.
Stein Mart typically targets a well-dressed woman age 35 to 60 who boasts a higher than average income. The company concentrates on "missy customers" who are fashion-conscious and seek value. Stores offer specialty merchandise not found among the general offerings at department stores and it banks on this for its overall appeal. Stein Mart is looking to lure younger and Hispanic shoppers into its stores with an improved mix of distinctive, inexpensive merchandise. While the retailer's buyers shop among some 1,300 vendors for the store's merchandise, Stein Mart carries a consistent mix of apparel and accessories across its store base. To entice its most loyal Stein Mart customers, it operates an Elite Preferred Customer program (launched in 2009). Eschewing shoes, Stein Mart prefers to outsource its footwear department to proven shoe retailers. DSW is the exclusive operator of shoe departments in all of Stein Mart's stores.
Stein Mart has also reworked its supply chain by transitioning to a third-party logistics network to deliver merchandise to the stores in a more efficient manner. The move has enabled it to pull merchandise from various vendors from three store distribution centers; its merchandise is ready, at that point, to hit the selling floor. For the effort, the retailer is looking at an annual savings of up to some $25 million.