By  on September 29, 2005

NEW YORK — Finish Line Inc. is targeting affluent female customers with its new yet-to-be-named women's athletic retail format.

"Our new concept will be a unique, multichannel premium athletic specialty store that speaks to active, trend-conscious women through its products, brands, store environment and elevated level of customer service," said Alan H. Cohen, Finish Line's chairman and chief executive officer, in a call with financial analysts last week. "Our new store will be primarily mall-based and targeted to 25- to 40-year-old active women who exercise at least one time per week and have a household income of $80,000 plus."

The announcement confirms a WWD report that the athletic retailer was planning a women's specialty chain.

Finish Line executives declined to be interviewed or give further details about the concept, but Cohen said the company sees potential for up to 200 stores for this chain and that each store will be about 4,000 square feet. He said he was unable to share the name of the chain since the company is in the final stages of trademarking it.

The product mix will be about 70 percent apparel and accessories, and 30 percent footwear, and the first stores are scheduled to open in April, he said. While the core Finish Line stores are primarily in regional malls, he said the new concept will be in "the best malls in the country."

"The apparel offerings will be multibranded, in addition to housing a collection of private label, basics and athletic fashion basics," he said. "Potential store locations include high-profile malls, lifestyle centers and street locations."

Among the brands the stores likely will carry are Under Armour, Nike and Adidas, and perhaps even Adidas by Stella McCartney and other fashion-forward labels, sources said.

Finish Line has hired Jeff Pofsky to be the vice president and general merchandise manager to oversee the team developing the concept. Pofsky was most recently senior women's apparel buyer at Target.

Analysts were bullish on the development, which comes when many retailers are consolidating.

John Shanley, an analyst with Susquehanna Financial Group, wrote in a report, "We are optimistic about the new retail strategy, given our belief that there is likely a lack of an apparel-focused specialty athletic store format serving the active woman shopper, particularly within the ranks of these targeted consumers with a substantial higher level of household income."Shanley also told WWD that the company was well funded and in a good position to finance this new chain. Finish Line has about $120 million in cash.

There are few athletic specialty chains for women. With this concept, Finish Line will compete with Lucy, the fast-growing women's athletic retailer, which now has 20 stores, and NikeWomen, which has 12 units. Both of those chains are on an aggressive growth track, and are opening units around the country.

The Finish Line chain also will compete with health clubs such as Equinox, which has 27 boutiques, as well as better department stores such as Nordstrom.

The move into this specialty concept comes when Finish Line has been facing some sales softness. Hit by lower-than-expected sales for back-to-school, earnings slipped 7.8 percent to $18.9 million, or 38 cents a share, from $20.5 million, or 42 cents, in the quarter ended Aug. 27. Sales grew 9.4 percent to $341.6 million, while same-store sales slipped 2 percent.

"Our sales performance during the b-t-s selling season was below expectations and promotional, and we expect business to remain challenging during the second half of the fiscal year," said Cohen.

Finish Line operates 639 Finish Line stores selling athletic apparel and accessories, and 38 Man Alive stores that primarily carry men's urban apparel.

For the six months, profits edged up 2.5 percent to $31.6 million, or 63 cents, from $30.8 million, or 63 cents. Sales grew 11 percent to $632.8 million and were flat on a same-store basis.

Women's footwear was "disappointing," and apparel was also a soft category, said Cohen.

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