Retailer News

SCA OFFERS CONSUMER REWARD PROGRAM

Shoppers Charge Accounts, a private-label credit card company, has unveiled an awards program called “Prestige Points.” The program enables consumers to accumulate points for each purchase made at participating merchants nationwide.

SCA’s proprietary software tracks consumers’ buying patterns. Consumers receive their point totals on their monthly billing statements and, once they reach the number a retailer has set, receive a gift certificate to that store. “We want the program to reward customer loyalty to a particular store,” says Ron Talerico, vice president of credit marketing and store relations at SCA. “It made no sense to give away trips or unrelated merchandise; the certificates encourage continued loyalty to our merchants.”

SCA is assisting participating retailers with custom signs, direct mail, gift certificates and other material, as well as providing technical guidance with the program’s software.

“By studying other incentive programs, we found the best ones are [those] that are simple to operate,” says Talerico. SCA tested the program for several months at select retailers to ensure it would be easy to operate. “We’re convinced this will increase sales for our retailers,” he says.

SCA, the 12th largest private-label credit card company in the U.S., administers charge card programs for independent retailers worldwide. It was acquired in December by the Hudson United Bank subsidiary of HUBCO, a N.J. bank company with assets of $1.4 billion and 45 branches throughout the state.

FRIEDMAN’S INC. ANNOUNCES RECORD SALES IN QUARTER

Friedman’s Inc., Savannah, Ga., announced record results for the quarter ended March 31.

Net income doubled to $781,000 (8 er share) and net merchandise sales grew 50% to $19.8 million. Comparable-store sales rose 3%. Total revenue for the quarter rose 50% to $23.5 million.

The increase in profit is due primarily to higher sales and a lower ratio of general and administrative expenses and fixed costs to revenue.

For the half year ended March 31, net income rose 72% to $7.6 million (80 er share) and net merchandise sales grew 62% to $67.5 million. Total revenue (including a 56.9% increase in finance charges) was $74.9 million, up 62%.

On March 17, Friedman’s filed a registration statement with the Securities and Exchange Commission to issue an additional 2.6 million Class A common shares of stock. The company plans to use the proceeds to fund future store expansion and to pay down debt. Based on completion of the offering, Friedman’s plans to increase the number of new stores from an earlier stated target of 40-60 to 60-80. The company opened 21 new stores in the second quarter and had a total of 172 stores in operation on March 31.