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Feature Article, May 2006
Plus-Size Growth
Leading women’s plus-size apparel retailer Charming Shoppes accelerates growth based on multi-channel strategy.
Susan H. Fishman
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Charming Shoppes will open nearly 160 news stores in fiscal 2007. Pictured: the company’s Lane Bryant store.
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America’s Number 1 specialty shop for women’s plus-size apparel, Charming Shoppes, Inc., is bumping up its growth strategy in 2007, primarily in the Lane Bryant brand. The company’s strong growth plan will add roughly 5 percent to its total retail square footage, with close to 160 new stores in fiscal year 2007, including 75 to 80 new outlet stores.
Charming Shoppes is the parent company of three distinct retail store brands — Lane Bryant, Fashion Bug and Catherines Plus Sizes — and Crosstown Traders, Inc., a direct marketer of women’s apparel. The leading multi-channel specialty apparel retailer currently has more than 2,235 stores in 48 states. The company is planning several strategic initiatives to continue to increase shareholder value over the next 3 to 4 years and to drive annual revenue from approximately $2.75 billion during the fiscal year ended January 28, 2006, to approximately $4 billion within the next 3 to 4 years.
Plans include an acceleration of the company’s new store opening plan with 60 Lane Bryant stores, 75 to 80 Lane Bryant Outlet locations, five Catherines Plus Sizes stores and 15 Fashion Bug stores. The company also plans to relocate 85 stores and close roughly 50 stores across its brands.
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Last year, Charming Shoppes began testing expanded floor space and expanded product offerings within the Cacique name, starting with a 25-store test. With good results, the company expanded it to another 47 stores and eventually developed a Cacique store.
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“We’re a premier name in women’s apparel,” notes Gayle Coolick, director of investor relations for Charming Shoppes, Inc. “We’re a traffic driver and a destination shop, and we service 62 percent of the female population. So we have a strong following of the majority of female shoppers.”
The Lane Bryant brand alone reached over $1 billion in sales for 2005. An essential component of growth at Lane Bryant includes expansion of its intimate apparel brand, Cacique, through a new Lane Bryant store concept. Last year, the company began testing expanded floor space and expanded product offerings within the Cacique name, starting with a 25-store test. With good results, the company expanded it to another 47 stores and eventually developed a Cacique store.
“We took six stores in the last 6 months and reconfigured the floor space to include two storefronts — one for Lane Bryant sportswear and another for Cacique,” says Coolick. “It’s done so strongly that it is our ‘go forward’ look wherever possible for Cacique.”
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Inside a Lane Bryant store. Lane Bryant’s parent company, Charming Shoppes, currently operates more than 2,235 stores in 48 states.
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The new side-by-side concept will begin its rollout in fiscal year 2007. The majority of full-line store openings for Lane Bryant are expected to be in the new, larger store format. The company also has 35 relocations planned for Lane Bryant, 20 of which will be in the new format. So by the end of the year, there will be 70 or more stores in the new double-front format.
The Lane Bryant customer is a moderate to better spender, ranging in age from 25 to 45, who shops for style as well as size.
“We have a strong African-American shopper for the brand, and we’re not married to any one demographic when it comes to ethnicity,” Coolick notes. “We feel we can enter a lot of different markets and succeed because we have a broad customer following.”
Because Lane Bryant is a specialty retailer, the company looks for markets with at least a percentage of plus-size women and a population of roughly 100,000. The store is primarily in mall locations with a growing presence in strip and lifestyle centers, which is the company’s highest priority right now, says Coolick.
“We find that it’s convenient to the customer,” she says. “These stores are doing probably 95 percent of the sales we see in a mall location with smaller square footage and lower occupancy costs. As a destination store, we’re seeing a lot of success with those locations.”
The company is well represented in the Midwest and Northeast, and expects to continue to add fill-in locations in those regions, but the broader growth opportunities are in the South and the West, according to Coolick.
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An essential component of growth for the Lane Bryant brand includes expansion of its intimate apparel brand, Cacique, through a new Lane Bryant store concept.
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In addition to the plan for retail store growth, Charming Shoppes will also enter the outlet channel through Lane Bryant Outlet, during July and August 2006. The company will open approximately 75 to 80 outlet store locations, acquired through the assumption of Casual Corner store leases from Retail Brand Alliance.
“It’s an amazing opportunity to step into 80 real estate slots all at once,” says Coolick. “We had the opportunity to assume the store leases all in one fell swoop and to enter the outlet channel today, instead of growing by five or 10 stores a year and trying to gain brand awareness.”
Additionally, Charming Shoppes will continue to build its infrastructure to prepare for the launch of new catalog offerings and the launch of the Lane Bryant catalog late in 2007. The company is also preparing for accelerated growth in e-commerce, and will add cross-channel selling tools to further enhance sales growth.
©2006 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.
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