NEW YORK — Even in these challenging times, with comparable-store sales and quarterly profits suffering and heightened economic and political uncertainty, a group of apparel executives said success is still achievable by staying true to core strengths, but being nimble enough to adapt to today’s realities.
This story first appeared in the October 17, 2002 issue of WWD. Subscribe Today.
“Decisions made today in this new climate could bring success in tough times,” Joyce Brown, president of the Fashion Institute of Technology, said at the start of the three-hour “Success in Tough Times” conference, held Wednesday at FIT.
Generally conservative in their outlooks for the rest of the year, executives from Jones Apparel Group, Diesel USA, Federated Merchandising Group and Reebok International prescribed tough medicine for the ailing industry. They offered various strategies — including better customer service, increased marketing and product differentiation — to win market share.
Outlining four key strategies for 2002, Janet Grove, chairman and chief executive officer of Federated Merchandising Group, said, “championing change is the priority.” She said further editing and narrowing its assortments, improving the shopping experience with better fitting rooms, enhancing signage, centralizing checkouts, simplifying pricing and fine-tuning marketing strategies should help the department store chain become more competitive for its time-starved customers seeking ease and speed.
Another avenue for Federated to drive sales, Grove said, is to offer newness within its private branded business, which is expected to generate 16 percent of its total volume this year.
Peter Boneparth, ceo of Jones, said retailers need to focus on inventory turnover and not inventory-building to ring up more sales with fewer customers. “Take what you are good at, but make it better,” he said.
Boneparth said Jones has the advantage of its size, product diversity and brand recognition to help it continue to grow, noting the debut of its Easy Spirit casual apparel line for fall. Boneparth said he believes Jones, which acquired LEI and Gloria Vanderbilt this year, still has opportunities in the discount and younger channels to further diversify and balance the New York-based apparel giant. (For more on Jones, see page 9.)
While Federated and Jones have a storied history and have proven themselves resilient in difficult times, new players to the industry face a more daunting challenge. Emanuel Weintraub, a retail consultant, said because of this ultracompetitive environment, his firm predicts that “within five years time, 25 percent of firms doing less than $200 million in volume will either merge or liquidate.
Obviously not wanting his jeans company to fall into that category, Andreas Kurz, ceo of Diesel USA, said his advice for retailers trying to keep afloat during these choppy times is concentrate on their company’s strengths.
“We are in an emotional business,” he said. “Help people out of their misery and give them a reason to buy.”
Other remedies, he said, include offering fresh and innovative merchandise rather than back-to-basics, and increasing advertising.
“Business in tough times is the same as business in good times,” Kurz said. “Business is never not tough.”