On Friday it launched Super Weekend, which ended Sunday, a sales event that provided for discounts of between 30 percent and 60 percent in stores and online, including 30 percent off newly arrived spring merchandise. Super Weekend is the latest in a series of ongoing promotions that started even before the recent Thanksgiving Day-Black Friday kickoff to the holiday selling season.
In October, the women’s specialty retailer said its board approved the evaluation of “strategic alternatives,” which includes, but is not limited to, “partnerships, joint ventures or a sale or merger of the company.” It hired Perella Weinberg Partners as its financial adviser.
Sources familiar with some of the ongoing discussions said last week that the “sale process has not gone well.” Other sources said a few asset disposition firms have started circling around the specialty chain.
To be sure, the presence of liquidators doesn’t necessarily mean that a bankruptcy or liquidation is on the horizon. One option could involve a downsizing that entails store closures, speculated one of these individuals.
Sources said Coldwater currently is meeting with prospective lenders. In July, it closed on a $65 million senior secured term loan provided by Golden Gate Capital, a private equity firm. It also has a $70 million revolving credit facility with Wells Fargo Capital Finance, which is set to mature on May 16, 2016. Sources said the company has enough liquidity to last through this spring, but a new facility will enable it to have more time for its turnaround efforts to gain some sort of foothold with consumers.
On Dec. 11, the Sandpoint, Idaho-based firm said its third-quarter net loss widened to $23.8 million, or 78 cents a diluted share, from a year-ago net loss of $20.5 million, or 67 cents. Net sales fell 17.9 percent to $154.5 million from $188.1 million. The last time it posted a quarterly profit was the second quarter of 2010. The last time it posted full-year profits was in 2006. It is set to post fourth-quarter and full-year results on March 5.
Shares of Coldwater slipped 1.6 percent to close at 88 cents in Nasdaq trading. It has until July 1 to raise its share price to $1 or risk delistment. The specialty chain has two big albatrosses: huge retail boxes and merchandise that hasn’t been resonating with the consumer.
Coldwater, which started as a catalogue firm selling Northwest-style fashions in 1984, began a push into brick-and-mortar four years later when it opened its first retail outlet on Cedar Street Bridge in Sandpoint, Idaho. One huge problem is that it expanded too aggressively with boxes far bigger than needed, critics have said. One of those contacts said the average-size store is 6,800 square feet. This person noted that Coldwater’s competitors such as Chico’s and Talbots have many stores that are just half the size of Coldwater’s boxes.
What the chain does have are decent real estate locations. “The real estate is in good markets and well located. They are in the areas where the demographics fit who is the chain’s targeted consumer,” said Andrew Graiser, copresident at A&G Realty Partners.
Lisle Davies, chief executive officer of consulting firm Davies + Co., said, “If there’s compelling product out there, people will buy.” As for Coldwater, Davies noted, “Their merchandise has not been resonating with the consumer. That, coupled with oversized stores, Coldwater can’t get the productivity it needs.”
According to Davies, the product at Coldwater is nondifferentiated and can be found somewhere else. “That’s different from a Talbots, which has a more conservative dress-up point-of-view for the professional woman, or Ann Taylor, which is more fashionable,” she added.
Consultant Walter Loeb said, “I’m not sure Coldwater has any meaning to customers. The assortments are confused. The stores are too large.…Coldwater targets women ages 40 to 60, but they already have Talbots as an option.”
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye