Nordstrom (NYSE:JWN) plans to boost the number of its off-price Rack stores by more than 100 over the next three and a half years to at least 230 stores, according to Nordstrom CFO Michael G. Koppel, speaking at an investment conference last week.
Some of the new Racks will be in Canada, where Nordstrom plans to start opening full-line stores in 2014.
"We believe we can have 230-plus Rack stores by the end of 2016," Koppel told an audience at the Piper Jaffray Consumer Conference in New York. "Our point of view on the Rack is one that has evolved over time. It's been kind of a step change. There was a period of time when we felt we couldn't have more than one Rack for every two full-line stores in a market. We got past that. And we got past the fact that there's one-to-one, because now we have more Racks than we have full-line." Nordstrom currently has 117 full-line stores and 127 Racks.
Koppel added that opening Rack stores is much simpler than opening full-line stores. Finding a Rack location and opening a store can be done within 12 months at a cost of about $4 million.
Nordstrom's mobile point-of-sale system, which was designed for full-line stores, has been even more successful in the Rack stores. "We've recaptured over 20,000 square feet of selling [space] because now we don't have those big checkouts, because we have people in the stores with the mobile POS that are checking people out," Koppel said.
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