Sponsors
Billabong ▼ -0.020 | PPR ▲ +1.35 | American Apparel ▼ -0.029 | The Buckle ▲ +0.01 | Columbia ▲ +0.06 | Deckers Outdoor ▲ +2.55 | Dicks ▲ +0.12 | Foot Locker ▲ +0.18 | Genesco ▼ -0.02 | Iconix Brand Group ▲ +0.01 | Jarden Corp ▲ +0.85 | Nordstrom ▲ +1.03 | Luxottica ▲ +1.64 | Nike ▲ +1.05 | Pacific Sunwear ▼ 0.00 | Skullcandy ▲ +0.09 | Sport Chalet - 0 | Urban Outfitters ▲ +0.06 | VF Corp ▲ +0.35 | Quiksilver ▲ +0.07 | Zumiez ▲ +0.81 | Macys ▲ +0.45 | Tillys ▼ -0.04 |
Ticker Sponsor
Readers Say
Keeps me in the loop
Keeps me in the loop

Being an Executive Edition member allows me to not miss a beat when it comes to the Industry business news. Definitely keeps me in the loop plus goes great with my morning joe.

- By Tony Perez, Surfer and Surfing magazines
Useful on a daily basis
Useful on a daily basis

It's well balanced information that is useful on a daily basis. I'm very satisfied with the Executive Edition. I start each day with SES and a big cup of coffee!

- By Tom Ruiz, EVP Sales, Volcom
Industry Insight

SDSI: 7 new companies accepted into the Springboard business mentoring program. AGENDA: Registration and travel planning now open for January and February trade shows.

Details on Industry Insight.


Tiffany Montgomery
Print This Article

Urban CEO on fashion shift

By Tiffany Montgomery
March 09, 2011 7:00 AM

I’m catching up on the Urban Outfitters earnings conference this week where there was a lot of talk about the fashion shift happening in contemporary apparel.

 

CEO Glen Senk said Urban Outfitters designers are still figuring out the new trends and have not hit the bull's-eye yet. As a result, apparel sales were weak during Q4 and the company’s gross margins suffered – falling to 39.7% vs. 41.7% - as stores moved through inventory.

 

The best-performing categories at Urban Outfitters during the fourth quarter were footwear, accessories and home goods.

 

Senk theorized that fashion-forward young women are pulling back on spending on apparel as they also navigate the change.

 

“I’m not aware of anyone in contemporary apparel that is enjoying big business right now,” he said.

 

He wished the company had boosted inventories in non-apparel categories to capture more business in the areas where shoppers are spending.

 

Urban Outfitters customers are early adopters, Senk said, so when the chain does figure it out, he believes it will likely be ahead of many retailers.

 

Senk said it could take an additional three to six months for Urban to navigate the shift, as there are a lot of moving parts to consider – fabrics, silhouettes, prints, color, the relationship of tops to bottoms.

 

Senk does not think the fashion shift will be as difficult for customers to adopt as the big-over-little trend, and the new styles are more “friendly” to customers.

 

He wouldn’t go into detail about what the new trends area for competitive reasons. The Urban Outfitters website features some styles in the “new arrivals” section that show the waists of the models, with shirts tucked into pants and shorts in some cases, though it’s unclear if that is what the shift is.

 

Looking at the big picture, Urban Outfitters still had strong results in fiscal 2010. Net sales rose 17% to $2.3 billion. Net income increased 24% to $273 million. Gross margins improved to 41.2% vs. 40.6% and operating margin improved to 18.2%.

 

The Urban Outfitters and Anthropologie chains also each surpassed $1 billion in sales last year.

 

 

Emails for Small Business with Constant Contact

 

 


Articles You Might Have Missed