The expansion announcement at the Citigroup Retail Conference and Field Trip in Orlando follows the biggest growth year yet for Chico's, which opened 150 stores in 2006. Chico's EVP and CFO Charlie Kleman says the company will also expand the size of its new Chico locations to 3,300 sf and open larger White House/Black Market stores of about 2,600 sf. Chico's will announce a plan for its Soma brand later this year.

The additional retail venues did little to help the company's merchandising efforts, however. In August, the firm's comparative store sales ran negative for the first time in 113 months and October sales were flat at both its Chico's and White House/Black Market stores.

Kleman blamed the sales downturn on higher price points and more casual styles, which were both snubbed by customers in a message that came across "loud and clear" to company management. "The merchandise itself wasn't as new as it should be. It wasn't as innovative as it should be," says Kleman, noting that the casual styles which propped up spring sales weren't moving as quickly by the fall.