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Industry News - March 11, 2008



Retail Bankruptcies and Store Closings Sign of Grim Economy
Dark clouds hang over some long-standing, well-respected retail chains. Earlier this year, more than two dozen leading names in retail announced they were closing stores or filing for Chapter 11 bankruptcy protection. Some shuttered their operations for good.

Problems range from poorly supported brand images and unmet shopper expectations to ineffective pricing structures. The declining economy exacerbated many of these problems.

“There are various reasons why some retailers have failed recently,” says Richard Hastings, Economic Advisor, The Federation of Credit and Financial Professionals. “Most point to a significant mismatch between retailer brand and merchandising, as well as meeting shopper expectations. As the chasm increased, financial stresses were impossible to sustain.”

According to Hastings, the economy has affected consumer confidence and may have sped up some retailer’s inevitable downturn. “The ‘consumer economy’ is in recession and we expect this to be a prolonged issue. All it will take is a slightly slower consumer economy to encourage many CFO’s to rethink budgets and investments and in some instances, close stores.”

Here is a list of some of the more prominent retailers that are closing stores or shuttering operations for good.

CompUSA: All 103 stores will be sold or shut down. After being acquired by an investment firm, the company's business and assets are being sold. The retail stores that don't sell will be shut down.

Levitz Furniture: The furniture retailer has liquidated its assets and closed all of its 76 stores.

Bombay Company: The company unveiled plans to close all 384 U.S.-based Bombay Company stores. The company’s online storefront has discontinued operations.

Sharper Image: The company recently filed for bankruptcy protection and announced that 90 of its 184 stores are closing. The retailer will still operate 94 stores to pay off debts, but 90 of these stores have performed poorly and also may close.

Charming Shoppes: The operator of Fashion Bug, Lane Bryant & Catherine's plans to close 150 underperforming stores, lay off 150 employees and reduce the amount of stores it will open in 2009.

PacSun 'Demo' Stores: Pacific Sunwear will close its 154 Demo stores after a review of strategic alternatives for the urban-apparel brand. Seventy-four underperforming Demo stores closed last May.

Talbot's Kids, Mens: The company reported that 78 stores will close after disappointing sales were reported for the children's and men's apparel stores.

Ethan Allen Interiors: The company announced plans to close 12 of 300+ stores in an effort to cut costs.

Movie Gallery-Stores: The video rental company plans to close 400 of 3,500 Movie Gallery and Hollywood Video stores in addition to the 520 locations the video rental chain closed last fall.

Other retailers facing closures include Rite Aid, Macy’s, Sofa Express, Kirkland’s, Sigrid Olsen (part of Liz Claiborne), Jasmine Sola and Rent-A-Center.

-Christina Zarrello



Fresh & Easy Announces Ten Additional Stores
Fresh & Easy Neighborhood Markets announce plans to open ten additional stores in Arizona. The grocery retailer currently has 15 markets operating in the state. Fresh & Easy currently has 58 grocery markets open throughout Southern California, Arizona and Nevada. At roughly 10,000 square feet, Fresh & Easy markets are smaller than the typical supermarket providing customers with a faster, easier shopping experience. The company, a subsidiary of U.K.-based Tesco, has invested $2 billion over five years in Fresh & Easy.

Tommy Bahama Launches its First E-Commerce Site
Tommy Bahama launches tommybahama.com, the brand's new e-commerce site with Escalate Retail's Blue Martini E-Commerce Suite. Tommy Bahama's first ever e-commerce website went live on Blue Martini in October 2007. Thus far, the site has increased the company's presence and product availability. One of the company's main challenges in implementing the e-commerce site was the ability to translate the company's “life is one long weekend” philosophy to the Web, which Escalate's platform has been able to help it achieve.

Foodtown Adds Shelf Edge Technology to Guide Dietary Needs
Foodtown implements a customizable in-store nutritional program to support its newly launched “Easy to Eat Well” program. Foodtown selects Vestcom to provide its Northeast grocery stores with data-driven shelf tags that operate as color-coded “flags”. These flags are used to identify foods that meet specialty dietary needs. Shelf-edge dietary tags are part of Vestcom’s new health and wellness education marketing programs available to retail chains. “Easy to Eat Well” is a customer service imitative designed to save Foodtown customers time and help make healthier food choices by providing them with wellness information at the shelf edge.

L’Occitane en Provence Implements BI and Planning Tools
L’Occitane en Provence chooses IBM Cognos 8 Business Intelligence and IBM Cognos 8 Planning as the framework for its global performance management project. The provider of cosmetics with natural ingredients creates reports to suit their needs without depending on the availability of technical teams. In addition, L’Occitane en Provence leverages IBM Cognos 8 Planning for budget preparation and can simulate accounting of results by field of activity. This enables the retailer to prepare the structure of the budget, incorporate financial and non-financial data and to facilitate reporting and monitoring.

More Technology News


Microsoft, IBM Collaborate on Pre-Installed Software for Retail
Microsoft and IBM announce that they are collaborating to deliver pre-installed Windows Embedded-Based POS software for retail. IBM selected Microsoft’s Windows Embedded for POS as the pre-installed operating system for its new AnyPlace Kiosk models, Self Checkout Devices and SurePOS point-of-sale devices. The integration provides retailers with a POS platform to help workers, while connecting consumers to products and information in a retail environment. The pre-loaded IBM systems have increased language support for 33 dialects and support industry standards including biometrics, electronic journal, bill acceptor, Smartcard and ClearInput.

JDA Software, Management Dynamics Help Improve Global Trade Management
JDA Software and Management Dynamics team up to deliver upgraded supply chain software and information services. By combining JDA Software’s Transportation Logistics & Management solutions and Management Dynamics’ Global Trade Management (GTM) suite, this integration addresses automation needs for importers, exporters and logistics service providers. The integrated offering also provides a network design and trade strategy tool to determine supply chain configuration for various global sourcing and distribution models. Some other features include supply chain e-commerce services, multi-model shipment planning and execution capabilities and export compliance solutions.

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