The beleaguered PacSun continues to forecast losses into 2012, indicating a hard hit for the action sports-based retail chain which is hoping to recreate a more fashionable presence in the new year. As we’ve noted based on our Youth Culture Studies data, various action sports-based brands and extending lifestyle apparel and footwear brands have fallen off the radar of cool among 13-25-year-olds for the past few years. While there are pockets of brands that continue to do well, having changed designs, styles, target markets, and direct-to-consumer strategies, a large portion of brands within the industry were got caught without the foresight of understanding a new generation of consumers.
According to PacSun’s conference call with analysts on March 13th, 4th quarter net sales from 2011 were $234.2 million compared with $237.6 million the previous year.
Some losses, according to the retail chain, come from closing low-performing store totaling 119 in 2011. In 2012, according Gary Shoenfeld, the President and Chief Executive of PacSun, they will close another 110, ending with a total of 550-600 stores in 2013.
Plans for the upcoming year include greater ecommerce efforts especially among teens, which to many in the industry, comes as being late-to-the-game, while pushing some of its new brands and trying to diversify its merchandise between older brands already carried by the store and new.
American Apparel Get $80 Million
Billionaire George Soros plans to give American Apparel a line of credit worth $80 million. Soros, a notorious hedge fund manager, is no stranger to moving into difficult financial investments. He increased his investment in Israeli tech company Converse even though it had been delisted from NASDAQ.
American Apparel, which has been on the cusp of bankruptcy since 2010 has been through a series of financial changes not to mention various sexual harassment lawsuits against CEO Dov Charney. However it still remains an inspirational brand within youth culture, now having changed positions in preferences compared with other apparel brands and T-shirts as illustrated in our Spring Youth Culture Study 2012.
H&M Up 13%
Fast-fashion retailer H&M has a completely different story. February total sales for H&M increased by 13% compared with sales the same month in the previous year. The good news about Leap Year is the extra day provided a bonus 3% for the month.
For the 1st quarter, which for H&M extends from December 1, 2011 to February 29. 2012, sales increased 13%.
