Jeff Green Partners

Is The Other Shoe About to Drop for Specialty Retail?

admin — Thu, 18 Jun 2009 15:18:38 +0000

It has been awhile since we have heard much about any smaller specialty retail closures. Sure, we have heard a lot about box closures (Gottschalks, Mervyn’s, Circuit City and Linens ‘N Things), but all has been quiet on the specialty retail front for some time. Until yesterday.

Eddie Bauer declared Chapter 11 and Ruehl has will be liquidating completely as per this article in today Women’s Wear Daily (http://www.wwd.com/business-news/eddie-bauer-files-chapter-11-2173510?src=nl/mornReport/20090618). Neither of these developments is surprising per se, though I believe it portends the beginning of other similar announcements from specialty retailers…will the Martin & Osa concept really survive? I can’t help but postulate that this is the beginning of a rash of specialty store closures.

The Homogenization of the Department Store Industry?

admin — Mon, 13 Apr 2009 16:54:14 +0000

Is the behemoth known as Macy’s going to homogenize the traditional department store industry, offering the consumer few shopping alternatives going forward? It appears so.

With the recent announcement of the liquidation of Gottschalks, one wonders whether the regional department store industry can survive. The Bon Ton, with 280 stores operating under the Bon-Ton, Bergner’s, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger’s and Younkers nameplates is struggling, with March sales down more than 11% compared to March of 2008. Dillard’s, with well over 300 stores fared even worse in March, 2009, with sales decreases of just over 20% compared to the same time in 2008. Prepare to see both chains close some stores in the near future.

So, what are the options other than Macy’s for those consumers looking to shop the traditional department store? The most likely scenario in this economic climate is that the consumer will trade down to the junior department stores (Kohl’s, JC Penney and to a lesser extent Sears) and the off-price chains such as Ross, TJ Maxx, Marshall’s and Stein Mart. A few consumers (very few) are expected to trade up to Nordstrom, Saks and Neiman’s.

Fortunoff Begins Liquidation

admin — Thu, 26 Feb 2009 16:52:05 +0000

The final nail is in the coffin for Fortunoff. The sale will continue until all merchandise is liquidated. So, what was Fortunoff’s downfall? I believe it was an ill-defined brand. Being known as they were for such varied merchandise as jewelry, home furnishings and outdoor furniture, Fortunoff’s model was one of a specialty department store, at a time when consumers were more interested in smaller specialty store shopping.

Big Box Vacancies

admin — Wed, 04 Feb 2009 18:36:16 +0000

Big box vacancies are increasing exponentially. The following article from the St. Louis Post Dispatch does a great job of framing the issue and suggesting some alternative (and VERY creative) reuses.

Macy’s Huge Lay Off

admin — Mon, 02 Feb 2009 20:30:13 +0000

I don’t get it. How can Macy’s cut 7,000 employees by only closing 11 stores. It doesn’t make sense. I am on watch for a second round of Macy’s store closings.

Home Depot to Close Expo, Yardbird’s and HD Bath

admin — Mon, 26 Jan 2009 18:54:52 +0000

Hot off the press…It was just announced that Home Depot is closing all their peripheral brands, about 48 stores in all. Closing will be all remaining Expo, Yardbird’s and HD Bath Locations.

Kansas City Retail Market

admin — Mon, 26 Jan 2009 13:45:01 +0000

I spent a few days last week in the Kansas City market. First of all, it is one of the nicest markets in the US, especially the area around Country Club Plaza. Retail on the whole is performing well in the market. The most successful retail properties seem to be Town Center at Leawood and Oak Park Mall. However, one real concern in the market is the number of big box vacancies. In fact, there is a project in the suburb of Merriam with a recently completed Circuit City that never opened.

Integra Real Estate Resources, Inc in their IRR-Viewpoint, noted that the Kansas City Market Area has 43.9 million square feet of retail with a vacancy rate that is just shy of 10%.

Circuit City to Liquidate

admin — Fri, 16 Jan 2009 16:35:53 +0000

Sad to say, there is no surprise here. What is frightening is the number of power center vacancies due to the recent liquidations: Goody’s, Linens ‘N Things and now Circuit City. And are there any growing specialty box tenants to take their place?

Holiday Retail Sales

admin — Wed, 07 Jan 2009 19:36:54 +0000

I had the chance to address holiday sales on Money for Breakfast December 26th. MasterCard Spending Pulse Unit was already reporting that December sales through Christmas Eve were down 8% over 2007. That’s sales! The bigger question is what does this mean for profits? As I mentioned in the segment, this could equate to profits being down as much as 10% to 12%. While we won’t have final sales numbers until Thursday, it doesn’t look like gift card sales or deep discounts after Christmas saved the day. I hate to think about what this means for so many retailers already on the brink.

Best Buy 3Q Results

admin — Thu, 18 Dec 2008 17:03:59 +0000

Best Buy’s 3Q results came out Tuesday morning. I was pleasantly surprised to see their results were higher ($0.35/share) than Wall Street’s estimation ($0.24/share). I had the opportunity to discuss Best Buy and their earnings on Tuesday morning’s Money for Breakfast. We all thought the numbers were good. However, I found in later reports, many of the stories had a negative spin. Interesting how these things are perceived. If we keep telling consumers things are bad, things will be bad. As Bing Crosby sang, “accentuate the positive.” I’m sticking with my original opinion that Best Buy’s numbers were good! Let’s see if that sparks some positive feelings in the market!