Dear Mr. Berko: Please tell me what you think of Nordstrom. I bought shares of its stock at $32 in 2005. Should I sell the stock and take my big profit or continue to hold?
LP, Syracuse, N.Y.
Dear LP: If the well-known humorist, philosopher and manservant Sancho Panza were alive today, he might be heard lamenting, “The firing of those delightful piano players in all 238 stores suggests that Nordstrom has lost its elegance, its pedigree and its cachet.” And Sancho would be right as a trivet. Small tells such as this suggest a major change in management's direction.
Nordstrom (JWN-$56.72) management seems to be down-classing. And this is depressingly evident to many devotees who peruse the aisle clutter, the reduced inventory choices and Target-priced merchandise. Even more disappointing are the salesfolks who work the floor. I remember the salesperson in the San Diego store who greeted me by name in 1995, 1998 and again in 2001. I also remember my sales representatives from the Boca Raton and Tampa stores. They, too, knew my name and my size, which admittedly is easy to remember. The fellow at the Boca Raton store would reach me by phone when he saw something he thought I'd like.
These sales associates were proud to work at Nordstrom. They were compensated well. They earned good benefits. And they comported themselves as professionals. But that was another era in another time. Today the lines among Nordstrom, Dillard's, Macy's and even Kohl's are blurred.
JWN, a $12.7 billion-revenue chain, is one of the strongest operators in the department store business. JWN prided itself on being customer-centric. It filled an enviable niche in luxury shopping without being extravagant.
JWN offered high-quality merchandise, with-it fashion, superb service and a liberal merchandise return policy. In fact, it's rumored that a Nordstrom location in Chicago once accepted the return of four automobile tires that were purchased from Sears because the customer insisted they were purchased from Nordstrom, even though Nordstrom doesn't retail tires. But those days are gone. Though JWN's merchandise, in most cases, is still a cut above, it lacks the exclusivity, the character and the wow factor that made Nordstrom an intriguing shopping experience.
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