Dillard's

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This article is about a department store chain. For The Dillards, a progressive bluegrass band, see The Dillards.
Dillard's
Image:Dillards logogif.gif
Type Public (NYSE: DDS)
Founded 1948
Headquarters Little Rock, Arkansas, USA
Industry Retail
Products Clothing, footwear, bedding, furniture, jewelry, beauty products, electronics and housewares.
Slogan "The Style of Your Life"
Website www.dillards.com

Dillard's (NYSE: DDS), based in Little Rock, Arkansas, is a major department store chain in the United States, with 330 stores in 29 states.[1] Its locations are concentrated in the South, particularly Texas, Louisiana, Alabama, and Florida. It competes on a price level with Belk and Macy's.

Contents

[edit] History

The exterior of a typical Dillard's department store at the Firewheel Town Center in Dallas Fort Worth Metroplex/Garland, Texas.
The exterior of a typical Dillard's department store at the Firewheel Town Center in Dallas Fort Worth Metroplex/Garland, Texas.

[edit] Beginnings

Dillard's is the outgrowth of a Nashville, Arkansas, department store founded in 1938 by William T. Dillard; its corporate headquarters remain located in the eastern edge of Little Rock's Riverdale area, and many of its executives and directors are members of the Dillard family.

Dillard sold the Nashville store to develop a larger one in Texarkana, Arkansas, in 1948, initially as the minority partner in Wooten & Dillard. In 1956 Dillard led an investment group that acquired the Mayer & Schmidt store in Tyler, Texas. This store eventually took on the name "Dillard's Mayer & Schmidt" until 1974, when it was replaced with a mall-based location south of downtown Tyler.

In 1960, Dillard acquired and turned around the failing Brown-Dunkin store in Tulsa, Oklahoma. The success of this turnaround was followed in late 1963 by acquiring the Joseph Pfeifer store in Little Rock, Arkansas, and in early 1964 acquiring the other main store in Little Rock, Gus Blass Co. Dillard used this as an opportunity to relocate his headquarters to Little Rock. In 1969 Dillard and his investors took Dillard Department Stores, Inc., public on the American Stock Exchange.

Thereafter the chain grew rapidly as an anchor in suburban shopping malls, and took advantage of market conditions to acquire smaller chains as well as its ability to turnaround locations that other companies could not operate profitably.

[edit] Acquisitions & growth

Growth of the Dillard's chain came quickly in the 1970s, mainly through expanding into new malls being built in smaller cities in Texas. In 1971 five Texas units were acquired from Fedway, a division of Federated Department Stores (the stores were rebadged as Dillard's in 1972). In 1974 five Leonard's stores were acquired in Fort Worth, Texas, as well as a commitment to open a new downtown Fort Worth store at the Tandy Center (site of the original Leonard's). Also in 1974, the former Brown-Dunkin, Blass, Pfeifer and Mayer & Schmidt stores were fully renamed Dillard's.

The 1980s brought the purchase of many local chains. In 1982, Dillard's leased three units of the defunct Lowenstein's chain in Memphis, Tennessee. In early 1984, Dillard’s acquired 12 Stix, Baer & Fuller stores in St. Louis and Kansas City from Associated Dry Goods Corp., while in fall 1984 two department store divisions were purchased from Dayton Hudson: Diamond's and John A. Brown, with locations in Arizona, Nevada and Oklahoma. Twelve stores in Kansas and Missouri belonging to R. H. Macy & Co.'s Midwest Division, which was later dissolved in 2006, were acquired in early 1986, while the three-unit Hemphill-White's in West Texas was purchased in the summer.

In 1987, Dillard's purchased 26 of Joske's 27 stores in Texas and Arizona as well as the four unit Cain-Sloan chain in Nashville, Tennessee from Allied Stores Corp. This deal gave Dillard's two major anchor locations at several malls in Texas and Arizona with many of the second locations being converted to a separate, expanded home and men's stores, a format that Dillard's utilized greatly, both to grow its store size cost effectively and to prevent competitors from gaining valuable real estate. Additionally the Joske's acquisition gave Dillard's entry into the Houston market. In 1988, Dillard's purchased the three-unit Miller & Paine chain in Lincoln, Nebraska, as well as more significantly, a half-interest and operational control of The Higbee Co., based in Cleveland, Ohio with partner Edward J. DeBartolo Corp. The D.H. Holmes company was purchased in 1989, bringing 18 units primarily in Louisiana, as well two former Goldwaters units in Tucson, Arizona.

[edit] 1990s acquisitions

The Ivey's chain of 23 stores in Florida, North Carolina and South Carolina was added in 1990. This was followed by the acquisition of eight Florida Gulf Coast stores from Maison Blanche Co. in 1991 (which had acquired them as Robinsons of Florida only a few years before). In 1992, the remaining interest in the Higbee's stores were acquired, as well as five Ohio stores from Horne's (as part of a legal settlement, Dillard's having cancelled a 1988 deal to acquire the chain). Also in 1992, three stores from the Hess's chain liquidation (five other former Hess's were acquired in 1994), two E.M. Scarbrough's locations in Austin, Texas, three former Thalhimer's in North Carolina and Tennessee, a former Lord & Taylor store in Memphis, Tennessee and three former Belk-Lindsey stores in Florida were acquired by Dillard's. Except for two Belk of Columbia stores acquired in 1995, acquisitions were eschewed for several years until in early 1997 ten buildings in Florida were acquired from Mervyns, seven southern Virginia stores were purchase from Proffitt's (which had acquired them from Hess's in 1993), and three Macy's units in Houston, Texas were absorbed.

[edit] Acquisition of Mercantile

The deal-making culminated with the purchase of Mercantile Stores Co., Inc. in 1998. This brought several chains, including Bacon's, Castner Knott, de Lendrecie's, Gayfers, Glass Block, Hennessy's, J.B. White, Joslins, Lion, Maison Blanche, McAlpin's, Root's and The Jones Store. Dillard's sold 26 stores of the former Mercantile Stores to May Department Stores Co. and Saks Incorporated and traded an additional seven stores to Belk for nine of theirs in southern Virginia and Chattanooga, Tennessee. Overall this deal enabled Dillard's to enhance its position in several markets in the South, Midwest and Mountain States.

[edit] Discrimination

In May 2001, Dillard's was ordered by a jury to pay $800,000 in a wrongful death trial in a Houston state court. The case involves the death of a man who Dillard's alleges was psychotic. Police officers were called in to the store to handle the man who had become belligerent. An employee claims she saw officers beating the handcuffed man, who died two days later after being on life support.

Dillard's pulled advertising from some CBS affiliates after the network's "60 Minutes" featured a story about Dillard's alleged discrimination against minorities. The show described a lawsuit against Dillard's and some security guards who allegedly harassed and beat black customers, leaving one person dead. The company did not pull ads from ABC or NBC affiliates.

Dillard's was sued by more than 80 African American shoppers in Texas claiming racial profiling. The company has also been sued by customers in Mississippi, Kentucky and Georgia on similar allegations.

In July 2001, a woman filed a discrimination suit against Dillards, claiming she was detained and strip-searched while shopping in the store in July of 2000. The woman, who was three months pregnant at the time of the incident, said she was confronted by a security guard after using the restroom. The guard told her an employee saw her enter the restroom with clothing and accused her of hiding the items under her own clothes. No stolen items where found. The woman is seeking more than $10,000 in compensatory damages and an unspecified amount in punitive damages.

In April 2001, a federal appeals court upheld the $1.2 million verdict against Dillard's in a discrimination lawsuit. The suit was filed by a black woman who said she was denied a free cologne sample because of her race.

A lawsuit was filed against Dillard's and a security guard for malicious prosecution, as well as other allegations, relating to an incident in June 1999. Two minority women were detained and searched after a purchase, only to find valid receipts for everything. They were then detained for another hour and issued citations for another unrelated offense that was allegedly fabricated. Later, they were charged with criminal trespass after trying to resolve the matter with an elder family member. They were found innocent of all charges. In 1995, a former Dallas Cowboys player, also a minority, was detained and accused of shoplifting at the store. He was awarded a $22.5 million verdict.

In May 2001, Dillard's was ordered to pay more than $56,000 in damages for pain and suffering, $1.1 million in punitive damages, and more than $146,000 in attorney's fees to two Arkansas women who had filed a racial discrimination lawsuit against the department store. The lawsuit alleged that the women were wrongfully detained at a Dillard's store in 1996 and accused of shoplifting. No evidence of theft was found.

In February 2002, the US Equal Employment Opportunity Commission on behalf of a former Dillard's employee filed a lawsuit against the company claiming religious discrimination. The lawsuit alleged the company refused "to honor the religious beliefs of one of its employees." The part-time employee, who is also an ordained Baptist minister, claimed the company scheduled her to work on days and times that conflicted with her religious obligations, even though she told management that she could not work then.

[edit] Ethics

In January 2003, a Texas district judge ordered Dillard's not to destroy security personnel notebooks and logs that plaintiffs in lawsuits against the retailer claim may show systematic targeting of minority and low-income shoppers for surveillance and intimidation. According to documents given to an attorney for a plaintiff in a discrimination suit against the store, a Dillards official in May 2000 ordered that all security officer notebooks, logs and other documents be sent to corporate headquarters and that no copies be retained by local stores. An internal e-mail dated July 2001 stated that "All unauthorized forms or notebooks containing narrative information of non-arrest activity must be destroyed."

Dillard's is listed in a Government Accounting Office database of more than 900 publicly traded companies that have restated their financial results because of accounting irregularities since the beginning of 1997. Dillard's was listed for a 2001 restatement for revenue recognition related issues.

[edit] Health And Safety

In 2005, Dillard's paid $15 million to settle a lawsuit brought on behalf of a 5 year old girl whose fingers were amputated in a defective escalator at the company's St. Petersburg, Florida store. At the time another lawsuit against Dillard's was under consideration in Iowa. In that case another child also lost fingers.

Dillard's has a policy of hiring armed, off-duty police officers to provide security. Since 1994, at least six people have died after confrontations with Dillard's security officers. In all cases but one, the victims were minorities. None of the victims had weapons.

[edit] Special Awards

In 2002, BusinessWeek named Dillard as having one of the worst corporate boards. The company was listed because CEO Willaim Dillard, before his death in February 2002, presided over a board in which included four of his children. There was no nominating committee for board members and two-thirds of board elected by holders of privately held Class B shares.

[edit] Today

After the acquisition of Mercantile, Dillard's ceased expanding through acquisitions (though eight locations of the defunct Montgomery Ward, and four locations from ZCMI in Utah and Idaho were acquired in 2001).

The chain continues to expand and has recently begun adding stores in non-mall shopping centers : its largest store at 350,000 square feet (33,000 m²) is located at Scottsdale Fashion Square in Scottsdale, Arizona.

In 2004 Dillard's store credit card operation, operated as Dillard's National Bank, was sold to GE Money Bank. Customers can now be issued Dillard's/American Express cards as well the traditional Dillard's store charge. These cards can be used at any store that accepts American Express.

[edit] Current locations

[edit] Future locations

[edit] Former locations

[edit] References

  1. ^ Dillard's Investor Relations. Dillard's. Retrieved on March 9, 2007.

[edit] External links

Store Conversions to Dillard's

1998: Castner Knott | Hennessy's | J.B. White | Gayfers | The Lion | Joslins | Maison Blanche | McAlpin's | Bacon's
    1992: Higbee's | Joseph Horne     1990: Ivey's     1989: D.H. Holmes     1988: Miller & Paine
    1987: Joske's | Cain Sloan     1986: Hemphill-Wells     1984: Stix, Baer & Fuller | John A. Brown | Diamond's
1974: Leonard's | Gus Blass | Mayer & Schmidt | Pfeifer's | Wooten's    1972: Fedway      1960: Brown Dunkin
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