FRED MEYER WILL EXPAND SPLASH SHOP IDEA IN '97

JOEL ELSON

PORTLAND, Ore. -- Fred Meyer here will expand its Splash bath and body shop concept, introduced at 17 units earlier this year, to 46 additional locations next year.

The chain's sales in this "specialty business that we've put together are extremely strong and doing very well," said Curt Lerew, president and chief operating officer.

The bath and body department, primarily located adjacent to cosmetics, comprises 600 to 800 square feet with products merchandised on shelving, pegged and in wicker along the bottom-shelf tiers. Customized 64-inch-high aluminum and wooden fixtures are used in the presentation to give the section a specialty look.

To draw attention to the product segment, Fred Meyer advertised bath and body gift baskets for Christmas in floor displays arranged by cosmetics.

While the products also appeal to teens, the majority of sales come from women in the 20-to-40-year-old group. Current lifestyles also seem to be a major factor in driving sales, Lerew said.

"People are busy and working and want to feel good. They like to pamper themselves with a relaxing moment at home," he said.

The 600-stockkeeping-unit mix is priced from $1 soaps to $6.99 for other bath assortments. Prior to the introduction of this concept, Fred Meyer offered only 40 items in bath and body that were sold in cosmetics or health and beauty care areas.

The broad product mix ranges over assorted soaps, oils, pumice stones and bath beads to fragrances, candles and bath and body therapies. Fred Meyer's private-label bath products are merchandised under the "Floral Botinique" label.

Although floating candles and loofa sponges have been among the best-sellers, "Our main business is in after-bath lotions. Also doing well are bath and body therapies and additives mixed in to the bath water to soften skin, and oil-based fragrances," said Lerew.

Bath and body products have grown in popularity, and new specialty bath shops continue to open in malls, Lerew said. "People usually go to specialty and department stores for these products," he noted.

However, not all supermarkets have devoted space for this category despite the higher profit margins and turns, he pointed out.

Category product margins, in the 20% to 40% range, are higher than traditional HBC margins, said Lerew. The shelf turns are also at a faster rate because of higher usage. "A bath and body product lasts a shorter time at home than a tube of toothpaste," added Lerew.