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  • After thirteen months of declines in miles driven in the U.S., Pep Boys highlighted that both April and June showed increases. While it is still early in the recovery process, Pep Boys management believes the miles driven trend has stabilized. Importantly, on an absolute basis, total miles driven remains well below 2007 levels.
  • After one of the toughest years on record in luxury retailing, Neiman Marcus suggested that the bulk of its cost cutting efforts (both near and longer-term) are essentially complete. The company will continue to look for additional savings but it appears at this time there is little opportunity to cut meaningfully from current expense levels. If sales were to dramatically take a turn for the worse, then the company would consider store closures. However, with some improvement in August in the full priced selling of early Fall merchandise, a “doomsday” scenario does not seem likely at this time. We do wonder how customer service levels are holding up, given the company has 18% fewer associates than a year ago and 20% less than two years ago.
  • Without the aid of calendar shifts related to Back to School or Labor Day, Talbots is seeing substantially improved trends quarter to date. Current same store sales are down 10%, which marks a 15% sequential improvement from 2Q. While it’s still early, management attributes the improved performance to better product/merchandising, a significant increase in the number of transactions, increased units per transaction, and a very significant increase in conversion. Interestingly, compares for Q3 to-date are still tough for the next several weeks at which point they will become substantially easier.
  • In an effort to drive sales (knowingly at the expense of margins), Men’s Wearhouse continues to show positive results from its aggressive promotional stance in the suit category. Over the first half of the year, MW generated a 4.1% increase in dollars and a 23% increase in unit sales in its suit business. MW stands out as one of the few retailers that is strategically attempting to grow or hold unit share at the expense of aggressive promotion (while controlling inventories along the way).


-Peak Sport, Chinese Sportswear Maker Sponsoring NBA Players, Files for IPO - Peak Sport Products Co., the Chinese sportswear maker and distributor that sponsors seven U.S. National Basketball Association players, may raise as much as HK$1.9 billion ($246 million) in a Hong Kong initial public offering, according to a sales document. <bloomberg.com/news>

-Walmart Supplier Li & Fung Reports More Orders, `Positive Buzz' in U.S. - Li & Fung Ltd., the biggest supplier of clothes and toys to Wal-Mart Stores Inc., sees a “more-positive buzz” in the U.S. and has been getting “pretty strong” re-orders from retailers, driving up its shares. <bloomberg.com/news>

-Beige Book release shows Back-to-school purchases helped improve sales for retailers in some parts of the country but volume was weak - Based on anecdotal reports from retailers, economic activity in the U.S. “firmed” toward the end of summer. Overall, the majority of the 12 districts in the Fed report said consumer spending was still soft, but stabilizing. Boston, Kansas City and Philadelphia attributed marginal improvements in sales to b-t-s purchases. Boston observers said value-driven shopping will be the “new norm” and recovery could be long and slow. Philadelphia-based stores said the b-t-s shopping in August drove a small increase in sales, with youth apparel described as “solid or strong.” New York stores said consumer spending was close to expectations for July and August, but was significantly lower than a year ago. <wwd.com/business-news>

-Fred Schneider, CFO at Skechers USA Inc., has resigned from his post, effective February 2010 - Skechers announced the news early Wednesday and said David Weinberg, Skechers’ COO, will assume the additional CFO responsibilities. Weinberg had served as CFO for the company before Schneider was named to the position in 2006. Schneider served on Skechers’ board of directors and as chairman of the audit committee for two years prior to becoming CFO, and has also held senior roles at Pasadena Capital Partners, Leonard Green & Partners and KPMG LLP. <wwd.com/business-news>

-Affliction Holdings LLC is evolving its rock ’n’ roll image -The company announced on Wednesday it had inked two licensing deals with Evolutions Footwear and August Accessories. Evolutions will develop a line of boots, sandals, athletic and sport-casual shoes under the Affliction label, to be sold in department stores, specialty chains and boutiques in spring ’10. Meanwhile, August will produce belts, hats, watches and cold weather accessories bearing the Affliction moniker.  <wwd.com/footwear-news>

-Helly Hansen Names CMO, Plots Retail Expansion - Helly Hansen appointed former Timberland marketing exec Erik Burbank as its global head of marketing. The hiring comes as the Norwegian outdoor clothing brand revealed plans to ramp up its retail expansion efforts, particularly in opening up flagship stores. <sportsonesource.com>

-Speedo extended its long-time partnership with swimming superstar Michael Phelps through 2013 - As part of Phelps’ new Speedo deal, the brand will donate $10,000 to the Michael Phelps Foundation for every World Record Phelps sets; Phelps has committed to match each donation as well. <sportsonesource.com>

-New York Fashion Mega-Party Opens as Designers Scramble to Beat Slump - As New York Fashion Week opens today, the bottom line is survival, with hundreds of couturiers showing spring collections geared to getting them through a long sales slump. <bloomberg.com/news>

-The Container Store thinks outside the box and expands purchase pick-up - The Container Store recently offered a 15% discount on orders purchased on its web site but picked up in stores, resulting in online average ticket orders doubling those of in-store purchases.<internetretailer.com>

-YesAsia gives YesStyle.com a makeover - YesAsia.com is giving its apparel e-commerce site, YesStyle.com, a complete redesign and making the brand multichannel. <internetretailer.com>

-Bluefly rehires its former chief marketing officer - Online apparel retailer Bluefly has rehired Bradford Matson as chief marketing officer. Matson resigned in January, but has been working in a consulting role with Bluefly since then. <internetretailer.com>

-Columbia Sportswear launches new ecommerce site with an emphasis on brand and user experience - Demandware, Inc., the leading on-demand ecommerce solutions provider, today announced that Columbia Sportswear Company (NASDAQ: COLM), a global leader in the active outdoor apparel and footwear industries, has launched its first ecommerce site - Columbia.com -- using the Demandware eCommerce Platform. The site is part of Columbia`s expanded direct-to-consumer strategy, which also includes branded stores and outlets in key global markets, and was designed to help build and drive demand for the Columbia brand across all of its sales channels.   <reuters.com>

-Hanes endorsement of Michael Jordan Continues to Payoff - Michael Jordan will go down not only as one of the greatest athletes of all time, but he’ll likely be remembered as the greatest endorser of all time. Hanes Brands has aired over 25 commercials with Jordan over the past two decades, including the most recent spot with Charlie Sheen pitching the brand’s Lay Flat Collar undershirts and No Ride Up boxer briefs. “Michael’s appeal is extraordinary,” said Sidney Falken, senior vice president of the Hanes brand. “He is able to appeal to such a wide range of people, men and women, young and old.” Hanes execs also say that Jordan appeals to people of all classes. Unlike its main competitor, Fruit of the Loom, the $4.5 billion apparel brand is sold in both high-end stores and in the mass market retailers. As a result, Hanes has one of its products in 85 percent of US households. ” Despite the fact that Jordan has been retired for almost 6 ½ years, a Harris Poll taken in June revealed that he was America’s second favorite male athlete, behind Tiger Woods. Jordan was the only male athlete on the list who is retired.  <cnbc.com>

-China’s silk garments exports from January to July 2009 is down 21.94% but silk exports to Italy are  up 3.63% - Silk exported to Italy was the only market to register an export volume growth. The US remained the largest market of China's silk garment exports, accounting for over 40% of market share. In the first seventh months of 2009, China’s exports of silk garment to the US was down 34.45%. Average unit price stood at $13.5 per set, up 11.75% year on year. Zhejiang, Guangdong, Jiangsu, Shanghai, and Sichuan are the key export provinces and cities of silk garment manufacturers. Exports from Zhejiang accounted for nearly half of China’s silk garment exports. <fashionnetasia.com>

-Men have become big spenders on accessories in 2009 - Belts. Bags. Bracelets. In the latest evidence of Modern Man’s indulgence of the self, sales of men’s accessories in the first half of 2009 were up more than 7 percent over the same period in 2008, according to NPD Group, which tracks retail sales. (Women’s sales were down 11 percent.) The best sellers seem only too fitting: wallets (to pump up your currency) are up 30 percent; belts (to slim down your debt) are up 38 percent. And there are plenty of other hot spots, from well-known and expensive brands to obscure and thrifty ones. Pricey designer sneakers are walking out the door at Barneys New York and Jeffrey New York. Men’s bags, sales of which are up 14 percent, are among the year’s top sellers at Gucci and Prada.  <nytimes.com>

-Levi Strauss & Co. is celebrating the official opening of its largest Levi’s store in Europe today, a 6,480-square-foot flagship in Rome - The new flagship store is intended to herald a new direction for the brand in Europe. A new customer direction is becoming more prevalent in Northern Europe and the company intends to make moves to capitalize on the shift. Levi’s has opted for an understated and almost minimalist design approach with the Rome location, with little furniture and bare walls in order to enhance the feeling of space and put focus on the product. <wwd.com/retail-news>

-Salty Dog apparel brand is sold to a resort destination firm - Joint venture between Gordon Brothers Brands and Branded, LLC announced today the sale of the Salty Dog(TM) apparel brand to Jake Dog, LLC, a well-known resort destination firm based in Hilton Head, SC. Salty Dog is authentic. It's one of the few great main floor department store brands and a natural fit for Jake Dog LLC. Salty Dog, a historic American Heritage brand first introduced in 1937 by Canton Textile Mills, was later owned by the Gant Corporation and then Phillips Van Heusen before being acquired in a joint venture between Gordon Brothers Brands and Branded, LLC. "We are excited to acquire the Salty Dog apparel brand. Working with Gordon Brothers Brands and Branded, LLC proved to be a smooth and seamless transaction and we look forward to furthering the success of the vintage Salty Dog brand," stated Robert Gossett of Jake Dog LLC.  Jake Dog, LLC operates five restaurants throughout the island of Hilton Head in South Carolina. In addition to the cafes, they have three apparel shops on the island. Both the restaurants and stores are extremely popular tourist destinations.  <prnewswire.com>

RESEARCH EDGE PORTFOLIO: (Comments by Keith McCullough):  AMZN 

09/09/2009 10:35 AM


Runkle was long it; we sold it; and now we want to be short it. Seems like an objective thought process. Kindle's issues are pending. Compares here are tough. Very expensive stock. KM