Plus-size women’s apparel retailer sets liquidation sales
It’s almost closing time for Fashion to Figure.
A U.S. Bankruptcy Court judge in New Jersey approved an order authorizing a joint venture of SB Capital Group and 360 Merchant Solutions to conduct liquidation sales at all of Fashion to Figure’s remaining stores.
Headquartered in Manhattan, B. Lane Inc. (doing business as Fashion to Figure) filed for Chapter 11 protection on Monday, November 13, 2017. At the time of the filing, the plus-size retailer operated 26 stores as well as an e-commerce site. Immediately following the filing of the Chapter 11, the retailer closed seven locations and consolidated store inventory into the remaining 19 locations. SB Capital and 360 plan to operate “Total Liquidation” sales in the 19 Fashion to Figure stores, and will operate the e-commerce site as part of the total liquidation.
Fashion to Figure was co-founded in 2004 by brothers Michael and Nicholas Kaplan, great-grandsons of Lena Bryant, the founder of the plus-size clothing chain Lane Bryant. The store’s name was derived from a quote Lena Bryant made in a 1950 interview in which she stated, “You should never ask women to conform their figures to fashion, but rather bring fashion to the figure.”
Several factors contributed to the bankruptcy filing and the ultimate decision to close the stores, including an ill-timed expansion.
Strong Black Friday weekend bodes well for Cyber Monday
Online led the way on Thanksgiving and Black Friday, boasting hopes for a record Cyber Monday.
Online sales grew across the three-day period from the Wednesday before Thanksgiving to Black Friday, showing 21% year-over-year revenue growth and 11% purchase growth. Average order value over the same period was up 9%, according to Rakuten Marketing.
Thanksgiving Day saw a surge in online spending, with sales surging 18.3% to $2.87 billion, compared to last year, according to Adobe. On Black Friday, shoppers spent $5.03 billion online, higher than Adobe had forecast.
“Shoppers capitalized on deep discounts on Black Friday, resulting in the largest Black Friday online ever,” said Taylor Schreiner, director of Adobe Digital Insights, in a report by TechCrunch. “Conversion rates across all devices saw double digit growth throughout Black Friday.”
Adobe projects that Cyber Monday will be be “the largest U.S. online shopping day in history,” with $6.6 billion in sales.
On the store side, shopper visits declined a combined 1.6% for Thanksgiving and Black Friday when compared to the same days in 2016, ShopperTrak reported. Black Friday 2017 shopper visits decreased less than 1% when compared to Black Friday 2016.
“There has been a significant amount of debate surrounding the shifting importance of brick-and-mortar retail, and the fact that shopper visits remained intact on Black Friday illustrates that physical retail is still highly relevant and, when done right, profitable,” said Brian Field, senior director of advisory services for ShopperTrak.
“This year, a greater number of brick-and-mortar retailers opted to close on Thanksgiving Day, which not only allowed store associates to be with their families, but also redistributed shopping visits to surrounding days.”
The International Council of Shopping Centers reported that more than 145 million adults spent time at malls and shopping centers over the Black Friday wekend and estimated spending, on average, $377.50.
“It was a huge win,” Rod Sides, vice chairman of consulting firm Deloitte, told USA Today. “I think bricks and mortar (malls and stores) held their own this weekend, which is exactly what (retailers) were wanting and needing this holiday season.”
Analysis: Holiday Outlook Strong. But Not For Everyone
Retailers remain relatively bullish as they prepare for this year’s critical holiday season. And they have good reason to stay optimistic. The U.S. Consumer Confidence Index has reached its highest level in 17 years, buoyed by a stock market that doesn’t seem to have begun defining its upper limits and the lowest unemployment rate in nearly a decade.
There is a danger in looking exclusively at national numbers and blended averages or “peanut buttering” success across product categories. This holiday period won’t be great for retailers serving the charred remains of neighborhoods in Santa Rosa, California or the storm-ravaged communities across the Gulf of Mexico and the Caribbean, where consumers are going to be spending their money — assuming they have any to spend — rebuilding rather than accessorizing. And sadly, too many customers in communities from Las Vegas to Sutherland Springs, Texas will be recovering from man-made tragedies as devastating to them as any natural catastrophe.
That said, A.T. Kearney’s proprietary holiday spend research, based on a survey of over 1,000 participants, indicates that the 2017 holiday spend numbers will likely finish moderately ahead of 2016. To understand who wins and who loses this year requires deconstructing those projected final numbers a bit.
Based on our survey work and analysis, we project that the percentage of people doing most of their shopping on Black Friday and Cyber Monday may decrease this year by as much as four percentage points over last year. This really isn’t that surprising. Several major retailers including Home Depot, Ikea, and Office Depot have announced they will be closed on Thanksgiving to give their employees time with their families. And others, including REI, will be closing their stores on Black Friday itself. Consumers, once almost frantic to get in on exclusive Black Friday discounts, now feel more confident that significant discounts will be available throughout the holiday period.
Higher Spending to Benefit Select Categories
Our research indicates that about a third of consumers believe they will be spending more total dollars this year. But that increased spending will largely benefit categories such as electronics, where high demand items tend to carry larger price tags — those $900 iPhones, for example — as well as higher ticket “must have” goods in general.
We found the median price respondents expect to pay (including taxes and discounts) for their highest value item has increased by 52% since 2015. In other words, consumers will be spending more dollars but purchasing fewer items.
Demand for key items will be high, triggering early promotional battles and punishing those retailers who go out-of-stock on those items and/or have reordering issues. Since this year’s projections favor high-end electronics, which are brand- and model-specific, we expect to see online sales once again gain ground on physical stores.
E-commerce sales are expected to rise by 16.6% this holiday and 10% of responding shoppers rated mobile, tablet, or click-and-collect as the most important channel, a 7% increase from 2016.
So, things will be good, but not for all categories, all channels, or even all geographies. This year’s holiday period is one rising tide that will not, in fact, float all boats. While overall, 2017 holiday sales will go down as a modest success, many physical stores will show year-over-year declines.