Brooks
Brothers, the retailer famous for clothing titans of American business,
40 U.S. presidents, and boys going to their first school dances, filed for bankruptcy yesterday. You’ll never guess why...
It was because of the global pandemic
Despite generating more than $991 million
in sales last year, temporary store closures caused revenue to tank
while the preppy retailer struggled to pay rent on its expansive store
portfolio.
- It had roughly 250
stores in North America pre-pandemic, a product of CEO Claudio Del
Vecchio’s aggressive growth efforts. Brooks Brothers added about
one-third of its current U.S. store count under his leadership.
Del Vecchio
doubled down on its U.S. presence because Brooks Brothers is American to
its core. The 202-year old company that clothed Abraham Lincoln and
Teddy Roosevelt is also one of the last remaining retailers committed to
manufacturing some of its products in the U.S.—it has three factories in Massachusetts, North Carolina, and New York.
Problems existed before the pandemic
Corporate
America’s dress code shifted from pinstripes and button downs to
athleisure and fast fashion. The U.S. men's suit market shrank 8%
from 2015 to 2019 while the sports apparel market grew 17% over the
same period, according to Euromonitor. Credit to Brooks Brothers, it
recognized the change and released a line of casual clothes called
Golden Fleece in 2016.
-
It worked: Casual sportswear
accounts for around 80% of Brooks Brothers total sales, while tailored
clothes, like suits, make up the rest.
-
But not well enough: Brooks Brothers
still can’t compete with the online presence of newer, trendier
brands—only about 20% of its 2019 revenue came online, compared to 54% for Lululemon.
Bottom line: Remember, bankrupt ≠ gone forever.
Brooks Brothers secured $75 million in financing as it looks for a
buyer that “aligns with our core values, culture, and ambitions,” said a
company spokesperson. Translation: they'd better wear a suit.
|
I AM A REPUBLICAN BORN AND BRED
IN AMERICA .I BELIEVE IN EQUALITY AND JUSTICE AND THE CONSTITUTION OF THE UNITED STATES.I SERVED IN THE UNITED STATES AIR FORCE
MAJORED IN GEOLOGY AND MUSIC AND WENT TO ANGELO STATE IN SAN ANGELO, TEXAS
No comments:
Post a Comment