Jos. A. Bank Clothiers Inc. is bucking the trend.
This story first appeared in the August 26, 2009 issue of WWD. Subscribe Today.
The Hampstead, Md.-based men’s wear retailer said Tuesday it will open 30 to 40 stores in fiscal year 2010, an increase over the 10 to 15 units it will add in this fiscal year.
“Quality real estate opportunities are beginning to open in the marketplace and we are ready to expand our store base at a more rapid rate,” said R. Neal Black, president and chief executive officer. “We believe we are poised to take advantage of these opportunities as a result of our strong financial position. We have a proven ability to open 60 stores a year and these future store openings will put us back on the track we were on prior to the national economic crisis.”
The company has opened over 350 stores in the past 10 years and expects to add at least 130 more as part of its announced long-term intention to operate 600 units around the country.
Black said the company downscaled its store openings in 2009 only because the right real estate wasn’t available. “We never stopped,” he said. “It’s just that the real estate stopped. We’ve always had the interest, ability and resources to keep going.”
Black said that in recent years, a “big part” of Jos. A. Bank’s real estate strategy has been to seek out “new construction, particularly open-air centers. But construction on those developments stopped in the second half of last year. So we had to regroup and look at second-generation space. Now that we’re comfortable with that, we’ve come back out and said we’re getting back on track.”
Black noted that most of the new stores will be in existing markets — the company operates 467 stores in 42 states — rather than new areas. “During this phase of the economy, we’re focusing on filling in,” he said. “We don’t see any new states coming on board in 2010.”
The company’s real estate team is looking at a variety of locations, from freestanding street spaces to malls and big-box centers. “Wherever the customers are, that’s where we’ll be,” Black said. “We’re even thinking we may be able to get locations we couldn’t have before the recession.”
In the first quarter, Jos. A. Bank reported net income rose 16.5 percent to $11.5 million, or 62 cents a share, from $9.8 million, or 53 cents, a year earlier. Sales for the quarter ended May 3 increased 11.4 percent to $161.9 million from $145.4 million. Comparable-store sales rose 4.3 percent as direct marketing sales advanced 12.1 percent.
Black said second-quarter results are scheduled to be released next week, but “through the first quarter, our sales are OK and we’re making money. We have plenty of cash and can open stores. It’s time to be aggressive.”