Retailers goose opening prices

NEW YORK — The lower have gone higher. Results from Home Textiles Today's second annual Market Basket Survey suggest that retailers have made a relative retreat from last year's heavily promotional environment — at least where a comparison of opening price points is concerned.

The average price of an opening price point shopping cart filled with standard bed and bath products rose by double digits compared to last year at seven of the nine stores visited by HTT editors. The jump ranged 12.7 percent at Wal-Mart to 55.2 percent at Kmart, which last year was in the final throes of its "match Wal-Mart" pricing effort. Tickets on opening price point market baskets fell lower at only two stores: Sears, down 7.1 percent, and Kohl's, down 1.5 percent.

HTT surveyed assortments at nine of the country's top home textiles retailers: Wal-Mart, JCPenney, Kmart, Target, Sears, Bed Bath & Beyond, Linens 'N Things, TJX's Marshalls and Kohl's.

Editors set out with a prototypical shopping list for the bedroom and bathroom, and scouted for both the lowest and highest priced offerings in each store for each item. In the interest of discovering each store's baseline pricing, sale and clearance items were not included — except at Kohl's, where some sale items were the only ones available to fill the shopping list.

Although the survey does not encompass the full assortment offered by each retailer across its store base, it does represent what a typical shopper would have found if she had visited these stores in these markets in mid-February. (See methodology, page 13.) While not every store visited by HTT offered every product on the list, none of the missing items caused a significant variation in the price of the market baskets.

Bedding products included a queen-sized sheet set, comforter, dust ruffle, quilt and blanket, as well as a pair of standard shams and a throw. Bath products included a bath sheet, bath towel, hand towel, washcloth, shower curtain, bath rug, soap dish, liquid dispenser and tissue box.

Not surprisingly, Wal-Mart emerged as the low-price leader of the pack, with its $188.29 tab ringing in 24 percent lower than No. 2 Sears' $234.24 ticket and 158 percent lower than No. 9 low-pricer JCPenney's $485.84 market basket.

Wal-Mart and Kmart were the only two retailers whose single lowest priced item in the market basket — in both cases, a washcloth — ticketed lower this year than the single lowest priced item in last year's basket. Wal-Mart's dropped from $1.00 to 80 cents. Kmart's knocked a penny off its cloth, coming in at $1.49.

While the majority of 2003 market baskets pushed their lower price points, nearly half lowered the ceiling on their top price point baskets. Sears logged the biggest year-over-year drop in the survey, with its top price point basket down 18.3 percent. Others lowering the boom included Kohl's, down 11.7 percent, Marshalls, down 15.8 percent, and Bed Bath and Beyond, down 1.8 percent.

Three chains also tightened the spread between their lowest and highest priced market basket items, with the low/high difference just $67.00 at Marshalls this year, $108.01 at Sears and $247.00 at Bed Bath & Beyond. The difference between Kohl's lowest and highest priced item remained steady over last year: $146.00.

Just three retailers offered enough upper price point merchandise to ring up tickets over $1,000: Bed Bath & Beyond, JCPenney and Linens 'n Things. They were also the only three with $1,000-plus baskets in 2002.

Bed Bath & Beyond's top-priced basket clocked in just a tad lower than last year: $1,604.85, down 1.8 percent. JCPenney's $1,209.92 basket represented a 9.7 increase over last year's basket. And LNT's basket jumped 15.2 percent to $1,183.83.

In this year's survey as in last year's, the percentage of US-made product dominated the baskets, although the US ratio in the total mix slipped from 57 percent to 53 percent.

US product constituted at least 50 percent of the total basket assortment (a combination of both a retailer's opening price point and top price point baskets) at Kmart, JCPenney, Target, Sears and Kohl's — although in every case except Sears, the percentage of the total was lower than in last year's market baskets.

China's portion of the total survey assortment inched up to 24 percent, and India climbed to 9 percent. The other 11 countries whose merchandise made their way into either the lowest or highest priced baskets accounted for just 14 percent of the overall mix.