Chicago Tribune from Chicago, Illinois • 34

Business 2 Section 4 Chicago Tribune, Monday, July 8, 1991 r'Jj J-J 'J wiJUJUiW unm William Gruber On business Valencia Horine Frale 1980 and previously managed the former Holiday Inn Lake Shore hotel. He reports that the Mart Plaza hotel in the first half of 1991 had the highest occupancy rate an average of 68 percent among the 40 dowrn town hotels. Boulevard Bank will offer free blood pressure, cho lesterol and diabetes tests Tuesday. i Because of the economy, most firms still are being tightfisted when it comes to scheduling company picnics or other social gatherings, according to Eliza beth A. Kretchmer, president of Eventful Occasions Inc.

But Kretchmer, who bought out her partner early this year, says the firm is busy arranging family events. Three entrepreneurs will "reveal how to succeed in DuPage" at a luncheon Wednesday sponsored by the DuPage Area Association of Business and Industry. Fred KoeLler owns Lynfred Winery; Roselle, the only winery in the county. Paul Stolzer is president of Big Apple Bagels, Naperville, which rums out 7,500 bagels a week. Alan Young is president of Dauphin Technology a laptop-computer maker in Lombard.

Summer doldrums? The Chicago Convention and Tourism Bureau expects a busy July, with 77 conventions, trade shows and other meetings scheduled here! this month. The biggest will be the National Sporting Goods Association show at McCormick Place July 15 to 18, which is expected to draw 85,000 people and fill; 8,000 hotel rooms. The general public is not COMING AND GOING: John J. Frale, former ex-; ecutive vice president and interim president of Affiliated Bank-Franklin Park, was elected president of the Bank of Commerce Industry, 6100 Northwest; Hwy. James M.

Mann, who also was an officer at Affiliated, was named vice president for commercial lending Jorge I. Valencia was promoted to princi-' pal of Ferguson Partners a real estate advisory firm. dent, Robert Adelizzi, to resign in May, the thrift firm's directors sent for the 57-year-old Wageman for help. Wageman spent 12 years at First National Bank of Chicago, where he rose to vice president. He joined LaSalle as an executive vice president in 1974, becoming president in 1979 and CEO in January 1983.

He left LaSalle the following July to become president of the troubled First National Bank of Midland, Texas. That bank failed several months later, and Wageman resigned when it was acquired by Re-publicBank Corp. of Dallas. Then Wageman moved to Sunbelt Savings Association, which in 1982 posted the largest loss for a thrift until then. When the Federal Home Loan Bank combined Sunbelt, with seven other insolvent Texas in 1988, he took the reins of the merged institution.

"I don't enjoy living dangerously," Wagemen said in a telephone interview. "But these fellows rang our bell and asked for help. I liked the opportunity and the challenge." Although HomeFed has "serious problems," as he put it, Wageman doesn't think it's in danger of a government takeover. "This company is not like Columbia a savings and loan in Beverly Hills, which federal regulators seized early this year. We're more like Bank of America.

There's no junk bonds. The problems are all real estate because of new problems in California. We have a lot of loans that have to be worked out." A footnote: Wageman, who was born in Chicago and has a sister living here, says he grew to love Texas and the Southwest while he worked there. Following the example of First National's former chairman, Gay-lord A. Freeman, Wageman says he would like to buy a ranch.

Freeman, who died recently, owned a big ranch in New Mexico. Sick California calls Wageman Although Thomas Wageman doesn't carry a medical bag, he is a doctor of sorts. The former Chicagoan has made a specialty of trying to cure ailing banks and savings and loan associations. Wageman, who was president of LaSalle National Bank until mid-1983, last week was named president and chief executive of San Diego-based HomeFed holding company for the nation's sixth-largest financial savings institution. HomeFed, with assets of $16 billion, was considered until recently to be one of the strongest thrifts in the country.

It has core deposits of $12 billion and 210 branches in California. Suddenly, a large portion of the real estate loans on HomeFed books went into the non-performing category, and its previously strong capital position eroded to dangerous levels. After government regulators forced its former presi Row LA. leads Chicago The Los Angeles area, which has wrested the No. 2 population ranking from Chicago, also leads the Windy City in several business categories.

In terms of buying power, it led the nation with $68.2 billion in retail sales last year, according to the July issue of Los Angeles magazine. Chicago was second, with $49 billion, and New York City third, with $46.7 billion. But L.A. was fourth in business failures, with 463, while Chicago came in fifth, with 409. In savings-and-loan failures, the California city ranked second, with six, while Chicago was fifth, with two.

L.A., however, led in the number of Rolls-Royce dealerships, with four. The Chicago and New York areas each had three. BUSINESS BEAT: William J. Horine is the new president of Rotary One for 1991-92. Horine has been general manager of the Holiday Inn Mart Plaza since Ads Commission regulations regarding alcohol advertising.

"We are responsible broadcasters, and we do do a lot for the community," Green said. About 1 million1 people 75 percent black and 7 percent Hispanic or Asian listen; to the station each week. Johnson Publishing publish-, er of Ebony, Jet and Ebony Man; magazines, also had no comment' on the issue. According to the June, 1991 issue of Black Enterprise, magazine, the Chicago-based cor-, poration, with 2,382 employees, earned more than $252 million in! 1990. Also declining to comment was George Miller, executive vice presi-: dent at Chicago-based Proctor, Gardner Advertising Inc.

As long as there's a market for the products in minority communities, they should be marketed there; via all forms of the media, said Louis Carr, Midwest advertising director for Black Entertainment Television. "It's not up to the media to say what African-Americans should or shouldn't consume. I think that certain appropriate groups are obligated to talk about the health risks and then it's up to the public to make their choice based on the information given to them," he said. The cable TV network recently gained controlling interest in black-oriented Emerge magazine and plans to introduce another publica-; tion for black teenagers. "The medium is primarily a forum for the facts to be aired, not a place for us to opinionize.

We cover a lot of controversial subjects in order to inform our viewers of the different views that are out there on particular subjects, and then it's up to them to make choices based on that," Carr said. "We're in a very, very peculiar; position in the media because we go out and tell major corporations that they need to send a direct invitation to the black consumers to purchase their products," Carr said. "You have to look at it from a consumer's standpoint. There are consumers out there who are always going to smoke, who are always going to drink liquor and beer." 1 -a. H-S sponsibility in dealing with black issues.

You have more of a vested interest. This is our community first. "I've seen a lot of liquor ads where it is very suggestive, very provocative, with a lot of sexual innuendoes. To me, that's like running an X-rated movie in prime time," Morris said. Morris mentioned a recent cigarette ad campaign.

He describes an ad in black communities that featured young blacks, while the version in white communities featured mature whites. "That, to me, is irresponsible," he said. "I think that both advertisers as well as the agencies anyone who is involved in creating images that are going to be seen by the public they have the responsibility to advertise good judgment and good taste in the development of those images. "I think we owe it to ourselves and our community to be vigilant of those who do seek to exploit it with the wrong messages," Morris said. Morris said though blacks spend $1.5 billion on alcohol and $1.7 billion on tobacco products, they spend even more on products that aren't advertised to the same degree.

For example, blacks spend about $7 billion annually on automobiles, he said. "If other manufacturers and marketers chose to target their message the same extent that the liquor and tobacco industries have, we wouldn't have a problem," Morris said. It's a solution agreed upon by most black leaders, who express a need to pressure other industries to advertise and sponsor events in minority communities, to help alleviate dependency on the alcohol and tobacco industries. Pfleger cited athletic shoe and sporting clothes industries among those that should take particular interest in minority community advertising and event sponsorship. Black shoppers account for 40 percent of the athletic shoes sold in the U.S.

Many other forms of minority-oriented media are keeping mum about their roles and responsibilities regarding the promotion of alcohol and tobacco products. The Chicago Defender, a black owned and operated daily newspaper, has not taken a position on the issue, said public relations director Michael Brown. WGCI, a Gannett-owned but predominantly black-managed Chicago radio station, also has not adopted a policy on the issue, said station manager Darryll Green. Green said the station complies with Federal Communications Between 1993 and 1998, Target plans to open 35 ison, Wal-Mart will have opened 24 Chicago area or more stores in the Chicago area. By compar- stores by the end of this year.

Continued from page 1 casional messages on health problems related to alcohol, Hacker said. "For a long time, the issue was providing business for black-owned businesses and getting more blacks involved in these areas. It's a sad commentary that the alcohol and tobacco businesses have actually led the way in providing opportunities," Hacker said. Pfleger said it's time to weaken the allegiances that black media have developed to the alcohol and tobacco industries. "They threw money out to buy power and to buy silence," Pfleger said.

"I think today we've got to not become dependent on that money and not allow that money to keep us silent from the wrongs they're doing. If they want to sponsor events, fine, but at the same time, groups should be just as vocal about the harm those industries are doing in the communities; and if that means then that the industry will pull back its dollars, then so be it. Members of the minority media are in a peculiar situation, said Marie Smith, managing editor of news at Black Entertainment Television, a black owned and operated cable network that reaches 31.2 million households in the U.S., of which 81.4 percent are black. "In the name of advertisement and the development of black business, we become enablers for the destruction of our people," she said. Eugene Morris, president of Chicago-based E.

Morris Ltd. advertising, agreed that though minorities in the media have a responsibility to make sure ads do not damage a community, alcohol and tobacco industries should continue ads and sponsorships. "I don't think that the advertising of alcoholic beverages is wrong. I just think that you have to do it in a responsible way," said Morris, whose 4-year-old agency has handled alcoholic beverage accounts but does not currently do so. "As long as it is legal to do that, I think that black people should be allowed to make a choice like anyone else.

"One of the key reasons why the alcohol and tobacco industries have chosen to target blacks with a lot of advertisements is because that's where their business is. If blacks drink and smoke in disproportionate numbers to the overall population, that's where you go," he continued. "But I also think that anyone black has a greater re Dayton feet. Much of the store is filled with basic items that, apart from Target's distinctive color-coded signs could be located in any of several discount-oriented chains. But to avoid the cluttered look, Target shuns center aisle displays, a hallmark of Wal-Mart stores.

It does allow some goods, such as bottled juices offered at a special price, to be put out in cut-down shipping cartons, however. "It gives people the feeling that Target has a lot of merchandise," said Randy Rients, one of the managers at the sparkling Target Greatland prototype store, which opened last year. Rients points to the store's sweep of cashier stands 32 lanes covering 89 yards as an example of how Target tries to eliminate the annoying long lines found in some discount stores. Target has adopted a one-plus-one checkout watch, which means it aims to have each customer wait for no more than one person ahead to check out. As with Wal-Mart, store employees are on a first-name basis with managers.

But executives have taken the idea of customer service a step further, with the slightly jarring habit of referring to shoppers as "guests," not "customers." "It's a way of stressing that what's most important is taking SPEAK SPANISH ITALIAN OR PORTUGUESE BY AUGUST 26 For just $15 a weak Small Classes 348-2216 The Spanish Studio Private classes also available. 722 Drveraey 230 N. Michigan, 11th Floor 823 Davis, Evanston 17 W. Maple, Hinsdale 1448 E. 63rd (By Appt.

Only) in than other goods because there's a fashion element involved, a presentation element," said John Landschulz, a retail analyst with Howe Barnes Investments Inc. "The Target stores have this department store backup, which gives them a head start, he said. Target's buyers who are organizationally separate from the company's department store buyers are probably more closely attuned to subtle changes in fashion than buyers at other discounters, he said. That gives Target an edge with shoppers who are both price-and fashion-conscious. "When you're in soft goods and you have things that are fashionable, people are going to buy them," Landschulz said.

"You have to be in the right pricing category, but to present it in a timely fashion is more important than beating the next guy by a few cents," he said. Landschulz estimates that about one-third of Target's sales are in soft goods apparel and home fashions. "The focus on Wal-Mart is good price for basic items you need. Whereas the focus of Target is on its fashion in basic goods," he said. "We try to deliver terrific values, but in a class environment people feel comfortable in," Ulrich said.

"We don't do anything that would imply a warehousey feel or clutter," he said. What may surprise many Chicago area shoppers most familiar with the Field's segment of Dayton Hudson's chain is that Target is the company's biggest division by far as well as its Tastest growing. Target stores last year generated $8.1 billion in sales, or 55.5 percent of Dayton Hudson's $14.7 billion in revenue. Its 420 stores comprise more than half of Dayton Hudson's outlets, topping the department store division and its moderate department store chain, Mervyn's. Profits for Target have risen consistently with its growth.

In the Chicago area, Ulrich noted, Venture stores "have done the groundwork" to introduce customers to the upper end of the discount trade. "Venture already started the move to more upscale," he said. "On identical products, we're competitive with anyone" in price, Ulrich said. "And we offer seme things of better quality." The basic Target store has 100,000 square feet, filled with a variety of private-label and brand-name apparel, home furnishings, sportswear and domestic supplies. Its new prototype store in Apple Valley, Minn.

which it intends to copy here with 1 models is 169,000 square Continued from page 1 non Hills, incidentally, also will be across the street from one of Dayton Hudson's better-known stores locally, Marshall Field in Hawthorn Shopping Center, whose product mix and department store prices do not provide competition for Target. Between 1993 and 1998, Target plans to open 35 or more stores in the Chicago area. By comparison, Wal-Mart will have opened 24 Chicago area stores by the end of this year, with more expected, while mart operates about 50 and Venture 38. "What we evaluate are the types of retail competition in a market, and Chicago is not over-stored by any means," said Robert Ulrich, chairman and chief executive of Target stores, in a recent interview. "There is no one like us," he said.

"We're an upscale discounter." This description rolls off Ul-rich's tongue with practiced familiarity, although to a linguist, the word "upscale" paired with "discounter" might seem contradictory. But for Target, the juxtaposition is the cornerstone of its strategy and the way it seeks to differentiate itself from Wal-Mart, mart and regional discount chains. The strategy has been successful for Target in other areas of the United States, where it has carved a niche in a market populated at one end by the discounters and at the other end by moderate department stores such as J.C. Penney Co; Sears, Roebuck and and locally, Carson Pirie Scott Co. and Kohl's department stores.

"We see a huge gap between what a discounter offers and a Carsons or Penneys," said Ulrich. "We're clean, bright and open. We make it very easy to shop. "We are different because of our department store background," he said, citing as a key asset Target's ties to parent Dayton Hudson which in addition to Chicago-based Marshall Field Co. owns two other upscale department store chains.

"In terms of people walking in the store, we feel we're much more like a department store than a discount store, only with a broader assortment," Ulnch said. "We're generally quicker in trends whatever color, style is in fashion, we tend to have it first. We feel there is a significant difference," he said. Outsiders tend to agree. "The soft goods are harder to compete Today we're the largest evening program and the second largest graduate business program in the country.

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care of your guests, Rients said. Like other leading chains, Target has invested heavily in retail technology so it can manage its inventory on an almost minute-by-minute basis. It also has ventured into information-sharing relationships with key vendors. Target has several vendors hooked into its electronic systems, so orders, payments and other sales data on those products are transmitted immediately to suppliers, allowing faster replenishment of goods in the stores. Target's Apple Valley store, for instance, is about 99 percent fully stocked, Rients said, a notable achievement.

By the end of this year, Ulrich said, goods representing half of Target $8.1 billion volume will be hooked up electronically to their suppliers. "There is an incredible need to be incredibly efficient in how we handle our merchandise," Ulrich said. As for Dayton Hudson's other plans for the Chicago market, Field's and Target appear to be the only immediate players. Officials said that in about five years, they may seek to open several of its moderate-price Mervyn's stores in the area. But in the immediate future, that chain's expansion plans are focused on Florida.

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