DANA POINT, Calif. — Apparel retailers and suppliers are looking to expand their market reach this year with new stores and concepts as well as brand extensions and international expansion, said company executives at the ICR Xchange Conference held here last week.
American Eagle Outfitters, for example, said it will open 50 new namesake stores and 15 stand-alone stores for the innerwear subbrand aerie by the end of 2007. The aerie subbrand could have sales volume of $5 billion in three to five years. The company plans to grow its knits category extensively in 2007.
True Religion said it will focus on growing its stores this year. The company said it expects to open seven stores in 2007, bringing the company total to 11 in the U.S. Retail stores account for 5 percent of its current business. Men’s denim will also be a key part of its business this year.
Brand management firm Iconix told attendees that its road to growth lies with additional channels beyond just its core women’s apparel brands. Brand identity is its key driver, the company said. The company said it will focus on extending its existing brands to “lifestyle status,” moving brands into the international stage, and acquiring new licenses. Guess said it will open 10 more of its G by Guess concept stores in 2007. The new banner has a retro feel, according to company executives, and is geared toward a trend-right, but not cutting-edge, younger consumer. The price at the concept will be between retail and factory outlet price points.
Urban Outfitters will announce a fourth concept sometime this year, according to company executives. The new as-yet-unnamed concept will be consistent with the company’s current comfort zone. Urban will also focus on growing its initial margins, investing in design and merchant talent as well as building its back office shared services this year.
VF Corp. sees its lifestyle brands as its growth driver moving forward. The business currently generates 35 percent of the company’s revenue, a number the company hopes to move to 60 percent in the next two years. The company also intends to invest in its direct-to-consumer business to strengthen its brands mostly through its retail stores, which currently number 600 and drive close to $1 billion in sales.
Pacific Sunwear said it is in the process of “slowing down the growth of stores,” due to a year defined by consistent negative same-store sales. The Anaheim-Calif.-based company plans to drive sales in its top-performing stores by implementing its primarily cosmetic “Refresh” concept in its top 20 doors.
Long-term objectives for Everett, Wash.-based action sports retailer Zumiez include investing in training and technology and providing growth opportunities for store employees. The 236-store chain will open 50 stores in 2007 in California, the Northeast and Florida.
Wet Seal said a focus on “cleaning up” its contemporary Arden B. division is a top priority for 2007. The company will bow 60 to 70 Wet Seal stores this year. The firm said it sees an opportunity to grow the Wet Seal business to 600 to 700 stores and the Arden B. business to 200 to 250 stores in the next five years.
Quiksilver said it will drive company growth through a combination of organic growth, new products, new territories and retail expansion. While the bulk of the company’s revenue comes from its Quiksilver brand, which is expected to be close to $1 billion in two to four years, the largest growth rate is predicted to be its DC Shoes, according to the company.
Teen retailer Charlotte Russe will open 50 stores and remodel an additional 25 in fiscal 2007. The company sees significant growth opportunity in the tops category, which currently accounts for around 41 percent of total store sales.