Retail Traffic

RETAIL FACE OFF: Back-To School Brawl

There's a rumble in the schoolyard again. Several down-at-heels teen retailers are hanging their hopes on the 2004 back-to-school shopping season. Charlotte Russe has been on a downward spiral since 2002. Former teacher's pet Hot Topic took a tumble in early 2004 when teens traded their Doc Martens for flowered skirts. Wet Seal teeters on the verge of bankruptcy and has lost almost all its core customers. And stalwart Gap is hoping to outdo last year's single-digit back-to-school comp gains and 2002's dismal season. Here's how the competitors stack up as the season unfolds:

2003 Same-Store Sales -10.10% 7% -16.40% 7.40%
Target Teen Budget Fashionista Prep Budget Fashionista Goths and Skaters
Sales Per Sq. Ft. $229 (-11%) $431 (+23%) $228 (-12%) $619
Sales Per Store $1.625 million (-13%) $3.78 million (+10%) $856,000 (-15%) $1.145 million (+3%)
No. of stores 311 1,389 604 554
Average Store Size 7,067 sq. ft. 8,524 sq. ft. 3,843 sq. ft. 1,788 sq. ft.
Hot Item skirts woven striped polo shirts “Granny Chic” line graphic tees with edgy phrases
Buzz June had the first-positive same-store sales in 11 quarters Brewing an H&M-style concept called D-Fifty Buying 20-page inserts in CosmoGirl! and TeenPeople magazines to lure back core customers. Denim bottoms will roll out for the first time for back-to-school season.
Prognosis “The company has made strides to improve visual merchandising and implement better inventory controls, helping to quickly capitalize on emerging feminine fashion trends - particularly the recent re-emergence of bright, vibrant colors as a driving force,” says Jeffrey Klinefelter of Piper Jaffray. A seven-week run of TV ads featuring Sarah Jessica Parker will be a home-run for driving sales and traffic, says CIBC World Markets analyst Anne-Marie Peterson. “The Wet Seal remains a wild card with the all bets on a back-to-school turnaround,” says Wedbush Morgan Securities analyst Adrienne Tennant. “The current feminine fashion cycle represents a virtual polar opposite to Hot Topic's edgier, darker fare,” says William Blair analyst Sharon Zackfia. But, “fashion trends ebb and flow and Hot Topic has been remarkably adroit at staying relevant to its customer over time.”
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