Consumers can expect to see unfamiliar store brands cropping up in the Baltimore area as a handful of retailers eye the market for expansion.

Newcomers could include businesses that are well-entrenched in other markets, such as Stein Mart and Gabe's, along with new, fast-growing chains such as Caffe Bene, a South Korean coffeehouse that targets millennials. Wagamama, a British chain of quick-casual Japanese restaurants, says it is considering Baltimore as it spreads to U.S. cities.


All say they are primed for growth as consumer demand strengthens. And they see opportunities in the Baltimore-Washington region.

The off-price department store chain Stein Mart struggled during the recession but has seen its sales rebound and is aggressively seeking new sites. The Jacksonville, Fla.,-based chain, with 263 stores in 29 states, plans to open 10 locations this year, including two in Virginia.

"Once we fixed everything internally, it made sense to get back on track" with store expansion, said D. Hunt Hawkins, Stein Mart's president and COO. "Plus, the economy is improving. We are very excited about the Baltimore area ... Annapolis, Towson, Columbia. We'd like to expand into those areas."

Hawkins described the region as "an area where we don't have a presence but have had success." He said the nearest store, in Falls Church, Va., has performed well since it opened in the spring.

Hawkins said the chain, which targets style-conscious women ages 35 to 65 with above-average household income, is "a perfect fit" for the Baltimore-Washington market.

Stein Mart is planning much of its growth in the near future in its existing markets in the Southeast and Texas. But long term, the retailer envisions 10 to 15 stores in the Baltimore-Washington area, including the four it will have by fall in Northern Virginia.

It makes sense for retailers to branch out in markets similar to those in which they've built a following, said Howard Davidowitz, a New York retail consultant and investment banker.

"You try to grow in markets that are most like markets where you are successful, that is a guiding rule, said Davidowitz, who chairs Davidowitz & Associates Inc.

But elbowing into new markets full of entrenched rivals can be tough, Davidowitz said, especially for those that try to expand too quickly. New players need to test the market and win over customers by setting themselves apart from the competition, he said.

"Depending on the level they're selling at, they typically will do something to get noticed," he said. "Today, everyone is watching every dollar. ... Value is a very powerful message in this economy."

Davidowitz said Stein Mart competes on price but tries to lure shoppers seeking a more enjoyable experience. It designs its space to look more like a department store than a discount outlet.

"The message is, 'We have a great deal and are promotional ... but it's not a mess,'" Davidowitz said. "Stein Mart stores are attractive. It's like the Wal-mart-Target comparison."

Caffe Bene, which plans to open its first Baltimore-area coffeehouse in Ellicott City in mid-August, hopes to set itself apart from the giants of the coffee world — Starbucks and Dunkin' Donuts — by marketing itself as a different kind of coffee-drinking experience.

Founded in 2008 in Seoul, Caffe Bene is now the second-largest franchised coffee chain in the world, with a menu that features Belgian waffles, Italian gelato and fresh-baked pastries in stores designed to look like European coffeehouses of the 17th and 18th centuries. Customers are served at their tables.


"We want to create an environment that's relaxed and conducive for [customers] to stay," said John Barry, franchise sales director. "Starbucks has had a great run for 40 years, but there's a new generation of coffee drinkers."

The chain grew to 900 locations in Korea in its first three years before expanding to the United Store in 2012 with a store in New York's Times Square.

The chain has licensed 100 franchisees in the United States, most of them in and around New York, Los Angeles, Chicago and Dallas.

The first Maryland location, planned for the Enchanted Forest Shopping Center on U.S. 40 in Ellicott City, is part of a push in the Boston-to-Washington corridor.

Barry said Caffe Bene is attracted by the above-average income levels in the Baltimore area. The chain envisions 50 to 60 franchise stores here over three years.

"Baltimore is surely on the map," Barry said. "Wherever there's a Starbucks, that's perfect for us. We can be just down the street a little bit."

Mark Millman, a retail consultant and recruiter based in Owings Mills, said he expects to see more new players coming into the market.

"Real estate is opening up, and Baltimore is becoming a hot, viable retail market," with successes such as Canton Crossing and Harbor East, Millman said. "The cost of doing business in this market is much less than that of Northern Virginia or D.C. ... There's still room here for some new, quality retailers who know how to merchandise, present product, have value and deliver good service."

Expansion by new players shows growing confidence in the economy, said Barbara Kahn, director of the Jay H. Baker Retailing Center at the University of Pennsylvania's Wharton School.

"If you have a successful concept, it invites competition," Kahn said. "Then, when you get competition, you have to do something to differentiate yourself."

For Gabe's, economic conditions are ripe for growth. The Morgantown, W.Va.-based discount clothing chain, which has a store in Abingdon and opened another in Glen Burnie in April, has rebranded itself from Gabriel Bros. and added more branded merchandise as it looks to nearly double its 44 locations.

The chain, which sells specialty store and designer-branded apparel and housewares at discounts, typically looks to take over space abandoned by other retailers.

"The retail climate in general is pretty challenging ... but we have been fortunate," CEO Ken Seipel said. "Our business has been strong. ... Regardless of your income, you want to save money."

The retail environment has meant more leftover store and designer-brand merchandise that can be sold to discounters, he said.

"We're looking up and down the Eastern seaboard, and we've got our eyes on Baltimore," Seipel said. "We've found the Glen Burnie site and are very happy, so now we're starting to expand our search around the Beltway. We like the city and will add a few more stores as soon as we can find the right locations," probably in the next couple of years.

Hawkins says Stein Mart's expansion has been fueled by its success in beating the competition. The chain has competed with department and specialty stores by offering brand names at discounts of up to 60 percent. And it has competed with off-price giants such as T.J. Maxx by offering shoppers a department-store look — arranging merchandise by brand and lifestyle and stressing customer service.

Stein Mart's sales began to rebound in 2012 as it stabilized its management, added more than 350 national brands to its offerings and reinvented its home goods departments.


"It's really going back to our roots," when Stein Mart built a name for itself in the late 1970s selling closeout merchandise from Saks, Hawkins said. "The affinity for the brands is obvious. Customers want to have the branded merchandise."

As the chain eyes the Baltimore area, finding the right location is the biggest challenge: "Real estate is tight up there," he said, with strong competition for the 32,000-square-foot spaces.

The chain is prepared to wait for the right ones, he said. It typically puts stores in neighborhood strip centers with upscale supermarkets and restaurants.

"Trying to find the right market and size [store] is key," he said. "We're very interested in seeing what happens with some of our competitors who may be consolidating and closing stores. We know the markets we want to be in and are being very picky."

Timing of a Baltimore expansion "depends on the real estate market," he said. "If the real estate becomes available, we would definitely move on it."