By  on May 9, 2016
The Scoop store at Brookfield Place in New York.

NEW YORK — Scoop NYC has an anniversary this year – 20 years in business – but instead of celebrating, the retailer is holding store closing sales. The contemporary chain, whose concept is "the ultimate closet," abruptly shuttered its New York flagship in SoHo on Monday.Sales at the remaining 15 stores began on Saturday. An employee at the Third Avenue location between 73rd and 74th Streets said all merchandise is 10 percent off, with the exception of hats and boots, which are reduced by 30 percent. A source said merchandise should be sold out in eight to 12 weeks. Scoop.com is also promoting 10 percent off site-wide.Scoop’s 10,000-square-foot flagship at 473 Broadway is representative of the retailer’s challenges. Some of Scoop’s stores are considered to be too big, and the company has been saddled with high rents, which chipped away at profitability, sources said. Many leases were signed when vacancy rates were lower and landlords could command top dollar.Scoop explored the possibility of selling the chain. "In recent months, they retained an investment banker to assist in the sale process," said the source. "Although there were expressions of interest from quite a few parties, the sense was that the prevsiling headwinds were too strong to overcome."Scoop's units include Brookfield Place, and men’s and women’s stores in the Meatpacking District in Manhattan. There are also stores in East Hampton and Wheatley Plaza in Greenvale, N.Y.; Brentwood and Beverly Hills, Calif.; Bal Harbour, Fla.; Atlanta; Chicago; Boston, Las Vegas, and Dallas.Despite margins in excess of 46 percent and increasing productivity of more than $1,200 per square foot, Scoop would have needed to achieve comps in the double-digits companywide to cover the rents at some of the legacy doors, the source said.Scoop's ultimate closet concept was innovative when the retailer launched, but it became widely imitated. Even brands that Scoop helped establish such as Rag & Bone and Alice + Olivia went on to open their own stores, which Scoop saw as competition. Retailers such as Bergdorf Goodman, Neiman Marcus, Saks Fifth Avenue and Bloomingdale's jumped hard on the contemporary  bandwagon, which had always been Scoop's stronghold.Scoop's objective was to open more stores. The unit Scoop opened last year at Brookfield Place in lower Manhattan was reportedly profitable. However, it wasn't enough and the number of stores Scoop needed to open was unattainable. Nor were fewer  stores the answer. "They needed scale not less units," said the source. "That's really the issue and that became evident."Susan Davidson, Scoop's chief executive officer, on Sunday discussed some of the brand's achievements. "We redesigned our Web site, which won awards and was on its way to becoming our second door," she said. "We experimented with smaller footprints in Meatpacking District, where we featured emerging designers. We did Scoop Party and Scoop Beach concepts."There's real love for the brand from our customers," Davidson said. "We started to expand our own private label with fur, leather, cashmere, shoes made in Italy and accessories. We grew our accessories business from 8 percent to 25 percent. Private label had strong growth even in these difficult times. It was some of our most fashionable products."Davidson said Scoop's legacy "will be the passion and commitment of the team. As they move forward, they're going to have  great success."Scoop was founded in 1996 by Stefani Greenfield and Uzi Ben-Abraham, offering an edited mix of designers such as Chloé, MissoniStella McCartney and Roberto Cavalli. The retailer was acquired by Ron Burkle’s Yucaipa Cos. in 2007.Melanie Cox, a consultant to Prentice Capital and Cerberus Capital on specialty retail investments, was named president and ceo of Scoop in 2008. The following year, Burkle hired Davidson, who was president and ceo of Creative Design Studios. Prior to that, Davidson spent 10 1/2 years at Liz Claiborne.Burkle has a decidedly mixed track record in fashion. His involvement has included stakes in American Apparel, which Yucaipa sold off in 2011, Barneys New York, Sean Jean, Zac Posen and Garrard, the U.K.’s crown jeweler.There were rumors that Yucaipa in 2012 was bidding on John Varvatos’ business, which was owned by VF Corp., but Varvatos was acquired by Lion Capital LLC. Yucaipa had also reportedly been negotiating for Catherine Malandrino; however, that ended up being acquired by Elie Tahari and Arthur S. Levine.Burkle is also known to have an interest in entertainment. He bought a 60 percent stake in Soho House in 2012 and invested $30 million to expand Relativity Sports after Relativity Media filed for bankruptcy protection. “Ron has been completely supportive of our strategy,” Davidson said in 2012. “I don’t think he wants to sell it. I don’t want to speak for them. He’s owned Sean John for years. I think he likes the fashion portfolio.”At the time, Davidson also said that having Yucaipa as an owner allowed her to invest in the Scoop brand.While Burkle may have decided that he doesn’t like the returns on the Scoop investment anymore, that doesn't mean he's happy about shuttering the chain. A source said the demise of Scoop is "difficult for Burkle. He doesn't like to lose."

To Read the Full Article
SUBSCRIBE NOW

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus