Blacks Retail Report

Luxury Apparel
July 2007

Table of Contents

• The Big Picture
• Early Birds
• Spring Trends
• Blacks Bottom Line

The Big Picture

The U.S. economy rebounded in the second quarter, posting GDP growth of 3.4%, thanks to the strength of exports and a lower unemployment rate. This was a substantial gain from the 0.6% rise recorded for January through March.
Better retailers are benefitting from the economic acceleration. Sales of early fall merchandise are strong so far, particularly in the luxury category.

Early Birds

As we’ve mentioned before, landing early fall deliveries is key to making it through the dog days of summer. Retailers who planned an early season are now reaping the rewards. Blacks is seeing big ticket collection items, luxury outerwear and sweaters flying off the shelves.

Retailers who are doing well in this market planned their success far in advance by establishing relationships with vendors to assure receipt of early deliveries. They’ve already blown out a majority of discounted summer goods and are now looking at a floor of full-priced merchandise that includes early fall goods and Wear Now product.  

If you’re a retailer who’s still dealing in discounted summer stock, it’s time to start on your early delivery strategy for spring/summer ’08.  It takes time to shift gears and adapt to this new schedule but the current market leaves little choice. Fashion consumers want to get their hands on the hot, new merchandise as soon as it comes out. If you don’t have it, they will go elsewhere.

Another important strategy is to forge relationships with your vendors that will allow you to fill immediate buys (“Buy Now, Wear Now”) on fast-selling merchandise. To do this you need to get into the vendor’s pipeline and establish your intention to make Wear Now buys. This has to happen seasons before you actually order the merchandise.
Both these strategies take a lot of planning so if you’re not already moving in this direction you should start now.

Buy Now, Wear Now

These “on demand” consumers are actually instigating a new “Buy Now, Wear Now” retail cycle. They continually want new merchandise and it’s up to the retailers to give it to them. Vendors are geared up for this cycle because it ultimately means more business.

To move in this direction, retailers should break their year down into 60-day periods in which you’re buying and flowing in new merchandise. Everyone is facing an on demand business model and it’s important to start the transition now.

Spring Trends

Buyers are back from their first look at spring ’08 merchandise and we’re hearing strong feedback on the quality of goods. Sportswear is going to be the driver this season since there’s little newness in clothing.

There’s a definite athletic influence in sportswear and at the same time we’re seeing premium streetwear seep into the category. Colorations are getting lighter and we’re seeing a return of the much-vaunted gray that never seemed to take hold last season.

Blacks Bottom Line