KTA PANEL: RETAIL MALAISE WILL DRAG ON
Byline: S. Gray Maycumber
AVENTURA, Fla. — There is little good news for the retail business for the rest of the Nineties and thus, a fairly tough outlook for soft goods suppliers, apparel manufacturers and the textile sector.
This was the consensus at the opening business session of the annual meeting of the Knitted Textile Association here Friday. The meeting concluded Sunday.
The opening session was to have been addressed by former New York Governor Mario Cuomo, but he canceled 12 hours beforehand, and a panel, scheduled for the following day, ably filled in. As KTA president Peter Frank, sportswear division manager of Malden Mills, said, “We in the textile industry are used to cancellations, and we always bounce back.”
Several panel members predicted that 1995 was not the watershed in retail closings, and that there would be more this year, as mergers and bankruptcies increase. The panel was kicked off by factoring executive Richard V. Romer, executive vice president at CIT Group/Commercial Services, who said, “The retail industry has serious problems and will be haunted by these for years to come.”
In particular, he said, America is overstored. “Despite this, retail space is continuing to grow.”
Romer noted an added problem: “The consumers who drove consumption to the levels of the Eighties have changed their spending habits. They are followed by a generation who are less motivated by fashion than their elders.”
But, he emphasized, the largest problem is “sameness of product.” He said this comes not only from an attempt to keep prices down but also “from the partnership between the supplier and the retailer, [which] much reduce creativity, ingenuity and new products.”
Also agreeing that “the customer is looking for newness and not finding it,” was Thomas J. Burns, senior executive vice president, general merchandise manager of the Doneger Group. He felt that retailers and manufacturers could help this situation by offering more “multifunctional apparel.” He cited the men’s wear industry as doing this with casual business wear and jumping aboard team sportswear for activewear.
Burns feels private label is an important focus for improving retail sales. “We have seen private label expand from a basic commodity business to fashion-forward, cutting edge items and collections.”
Steve Kernkraut, managing director of Bear Stearns, agreed that “these are dire times for retailing.” But he noted that specialized retailers merchandising “narrow and deep, which department stores can’t do, such as The Gap and the Men’s Wearhouse, will do well in ’96.”