Finance

During this whirlwind of retail bankruptcies, while the pandemic rages on with no end in sight, it should be a field day for private equity firms, awash in cash, to swoop in like vultures to acquire these bankrupt retailers on the cheap. However, several experts in the space told me that many of them are holding their "powder" (not acquiring) because of the big unknown. That is, without some indication of when the pandemic will end, how it will end and when consumers will feel safe enough to return to physical shopping. What will the ultimate …

Heading into the Homestretch, It’s Sycamore by a MileRead More

There are certain commonalities, trends, and uncertainties we should (hopefully) have top of mind as we take this epic journey that increasingly looks to be lasting a while. To set the stage, read this article by John Mauldin, whom I have a lot of respect for. You won't like it -- I don't like it -- but I've never thought it was my job to help you think happy thoughts. John is telling you something important more succinctly than I could (and with great charts!). The 10-Qs and 10-Ks for VF, Deckers, The Buckle, Tilly's, Abercrombie …

What’s Money Got to Do with It?Read More

The moment of truth is nearing for J.C. Penney. The struggling department store chain faces a July 15 deadline to gain lenders' approval for its bankruptcy reorganization plan and thereby unlock additional bankruptcy funding. Unless two-thirds of its bankruptcy lenders consent to its restructuring plan by then, J.C. Penney will be required to pursue an immediate sale of its assets. That could lead to a liquidation and the effective disappearance of this iconic brand. J.C. Penney's rapid fall from relevance over the past decade, plunging mall …

J.C. Penney May Survive Covid-19 (For the Wrong Reasons)Read More

Our Covid-19 response -- like virtually all policy -- is being shaped by people who are leading protected lives. They personally have little at stake economically to counter their natural concern that one day they might be accused of having done too little. But sweeping protective measures now in force carry such high costs that we must wonder how deep cost/benefit analysis has been, and how much sensitivity there has been to the lasting damage being inflicted on countless vulnerable lives. Locked Down and Out Our current lockdown was …

At What Cost?Read More

Besides online sales, what retailers need most right now is rent relief, in any size, shape or form! Many of them may need rent abatement for the entire time they are closed. Retailers, even the golden children, direct-to-consumer brands, are having a make or break moment. The cost of overhead is one of their largest expenses and with none-to-few revenues; this imbalance will be a retailer killer. In a normal environment there would be lots of guidelines and a legal framework to follow, AKA your lease. But this roadmap may not be enough. These …

What Retailers Really Need NowRead More

In the words of New York Times Columnist Paul Krugman, "At this point I've lost count of how many times markets have rallied in the belief that Trump was winding down his trade war, only to face announcements that a much-anticipated deal wasn't happening or that tariffs were being slapped on a new set of products or countries." While this could be the genesis of a new drinking game, the current tariff tumult, which it appears has reached a truce, is hardly entertaining for procurement officers who are trying to strategize around the shifting …

Reflections of a Trade War CorrespondentRead More

Heading into the home stretch of the 2019 Holiday season it looks like a bipolar mix of optimistic mania on one extreme and relative ho-hum on the other. Customer Growth Partners holds the mania ticket, predicting 5.6 percent growth (even up from their original 4.3 percent). And at the opposite pole, NPD is forecasting a relatively unexciting 2.7 to 3.2 percent. With six fewer shopping days between Thanksgiving and Christmas this year over last and high levels of inventory due to early over-buying to offset potential tariff increases, I would …

My Optimistic 2020 Playbook…with CaveatsRead More

This isn't another article prattling on about the so-called "retail apocalypse." Instead, we are going to take a look at what the retailers that are closing up shop have in common, as well as what they could have done differently if they wanted to stick around. Retailers that are going bankrupt or shuttering stores this year may not appear to have many similarities at first glance. But many struggling retailers that appear to be on opposite sides of the spectrum--such as Topshop and Kmart--have far more in common than meets the eye. Apparel …

Here’s What Recent Store Closures Have in CommonRead More