In the money: Christopher & Banks to cut average prices by 20%
Christopher & Banks' newly appointed interim CEO Joel Waller has revealed plans to cut average prices at the US women's wear retailer by approximately 20%.
The comments came after Waller admitted that clothing retailer's fourth-quarter results were "clearly disappointing", attributing the decline to customers rejecting the 23% increase in its fall and holiday assortment, combined with a "dramatic over-assortment" which meant that there was too much updated styling while "several key categories were abandoned.
Waller joined the company in mid-December, and revealed the "foundation" of its turnaround strategy yesterday (27 March).
The company will look to rebalance the assortment to offer the "right mix of products". It will improve the price value proposition by offering lower opening price points in all classifications. Christopher & Banks will also work to improve its inventory management, while developing a "more effective promotional strategy," said Waller.
Waller said the company will simplify its customer experience by reducing the number of price points offer - and the ticket prices on its good, better and best categories will all be lower than last year. He said that the approximately 20% reduction in ticket price will allow it to have a "much better value proposition" and allow it to "drive increased sales".
Waller also plans to reduce the number of SKUs the company offers by 25%, which he said will allow it to offer a more "focused and compelling product assortment". It will also work to improve its speed to market. He said the company has analysed and reduced its product development cycle in order to simplify and accelerate the development process. The company will make "better use of our US vendor relationships", cutting development to delivery time from 180 days to 90, which will give it the ability to test and re-order popular products, added Waller.
The interim CEO said that the women's wear chain is testing a number of promotional strategies, and those that prove successful will be "rolled into our future plans".
"We recognise that the landscape remains promotional and we will need to remain competitive. As such, we will continue to offer our customers special deals, but in a very strategic way, with pre-planned events. We will also be addressing markdowns on a more timely and frequent basis," he said.
The comments came as the company reported that net losses widened to US$31.7m over the nine weeks ended 29 January from a US$16.7m loss over the thirteen-weeks ended 26 February 2011. Same-store sales declined 14% over the nine weeks.
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