By  on April 13, 2010

Jos. A. Bank Clothiers Inc. is turning its attention to factory outlets.

The 473-unit Hampstead, Md.-based retailer said Monday it plans to test the concept with five stores this year, and, if successful, could add 50 to 75 units around the U.S. in 2011 and beyond.

“We’ve been looking at the factory outlet concept for a long time as a potential brand extension,” R. Neal Black, president and chief executive officer, told WWD. The company operates seven outlets, but Black said they’re older units, scattered around the country, that carry clearance merchandise. “It’s really hit or miss for the customers in terms of size and styles and, although they do a lot of business, they don’t make a lot of money,” said Black.

The existing stores are not located in any A-list centers, he said, with the exception of one in the Leesburg Corner Factory Outlets in Leesburg, Va. “That store has done such tremendous volume that we don’t have enough product to keep up with the demand,” he said.

The performance of that unit, which was recently relocated and expanded, prompted the company to look into testing the concept in other “legitimate outlets centers. We’ve found that there’s virtually no overlap with our current customer base,” Black added, “so we’re putting our foot in the water and developing product for fall.”

Black said men’s wear, “and tailored men’s wear in particular, is generally underrepresented in the factory store shopping centers.” The top two existing men’s wear players, he said, are Brooks Brothers and Polo Ralph Lauren Corp., “but both have low penetrations of tailored clothing.”

As a result, the mix in the beginning at the Jos. A. Bank outlets will be 50 percent tailored clothing and 50 percent sportswear and furnishings, he said, but will be tweaked depending upon the sales results. “We want to give the bigger ticket items every opportunity to sell,” he said, “so we’ll start with that and adjust accordingly.”

The merchandise will sport “compare at” labels offering 40 to 80 percent off similar merchandise found in other stores, he said. Coupons provided by the center will offer additional savings. Black stressed the goods in the outlets will be “different styles and assortments” than those found at the regular Jos. A. Bank stores and will be produced from different piece goods.

The stores will generally be between 3,500 and 4,000 square feet, slightly smaller than the traditional Jos. A. Bank store at 4,500 square feet. The first ones will open around July, Black said. He declined to provide exact locations, saying leases have not yet been signed, but said the company is looking at “core centers in the Northeast and going South.” It is seeking space on Long Island, the New Jersey Shore, in New England and in the mid-Atlantic states. “The good centers are highly leased,” he said, “so there’s not a lot of space available.”

The addition of these factory outlets will be incremental to the company’s goal to expand to about 600 full-line stores in the U.S.

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