A majority of vendors expect revenue growth to resume next year, even though a significant number of retailers don’t expect consumer spending to return to pre-recessionary levels until 2011 at the earliest.
Those are two of the conclusions from a new study by CIT Group Inc., which provides financing to small and medium-sized businesses.
Among the vendors queried, 29.8 percent of whom work in apparel and accessories, 17.3 percent expect significant growth in their revenues next year and 42.3 percent expect some growth.
However, expectations differed widely based on company volume. Among firms with revenues of $50 million to $1 billion, significant growth was expected by 22.6 percent, versus 11.8 percent for firms under $50 million, and some growth by 52.8 percent of the higher-volume companies, versus 31.4 percent of their smaller counterparts. More than half the vendors — 54.8 percent — will pursue aggressive pricing to support growth.
Despite upbeat expectations for their own businesses, 57.7 percent don’t believe economic growth will return until after 2010.
CIT found that 47 percent of retailers felt the financial markets would turn around in 2010. However, 45 percent said consumer spending would not return to 2007 levels until 2011 or 2012 and 17 percent said that might not even happen until after 2012. As for the upcoming holiday season, 67 percent said they will stock less inventory than last year, while 66 percent will offer greater discounts. Exactly half of the suppliers said they believed financial markets will turn around next year.
Among the retailers responding, 17.3 percent were from the specialty apparel sector, 15.5 percent were department store executives and 10.9 percent came from the discount channel.
Nearly half, or 48 percent, of retailers believe mergers and acquisitions will increase over the next 12 months, with 34 percent attributing the expected change to greater availability of credit and 32 percent citing reduced valuations.
Among the vendors, 66.3 percent said they have been impacted by a retail customer’s bankruptcy filing in the past 12 months, and 58.7 percent expect to be affected by such a filing over the next 12 months.
More than two in five — 42.3 percent — expect their ability to secure financing to remain the same over the next year. In addition, 45.2 percent expect their financing needs to grow over the next 12 months. Of those who expect to seek financing, 34.6 percent said it will be used for customer financing while 20.2 percent will use it for acquisitions. In general, 72.1 percent will use financing for working capital needs over the next 12 months, with 50 percent for growth and 28.8 percent for acquisitions.
In total, 110 respondents were executives and financial decision makers at middle-market retailers with revenues of $25 million to $1 billion, while 104 executives and financial decision makers were suppliers in the middle market having revenues of $2 million to $1 billion.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)