by The Editors on February 11, 2009
Nike plans to eliminate 4 percent of their 35,000 person work force (about 1,400 jobs) according to a story on Oregonlive.com.
The decision to reduce our work force is a difficult one, but it will put our business in the strongest position possible to continue to deliver long-term profitability and growth,” President and CEO Mark Parker said in a statement. . . . The layoffs would be Nike’s first since 1998 and 1999, when the company cut about 2,500 positions — but not the first belt-tightening measure of this recession. Late last year, Nike executives instituted a hiring freeze, reined in travel spending and said they would slow their plans for opening new stores in 2009.
At least Nike is giving some numbers and speaking up about the layoffs unlike some action sports footwear companies we know.
[Link: OregonLive.com]
by The Editors on February 10, 2009
Another analyst who follows Quiksilver’s stock has downgraded her rating thanks to Quik’s rather large debt, according to a story in the Orange County Business Journal.
Caris & Co. analyst Claire Armstrong Gallacher downgraded Quiksilver’s stock to “average” from “above average,” saying the company’s profits are “at risk” due to its heavy debt and the retail sector’s downturn. . . . “Given the large debt burden, tight credit markets and worsening consumer spending trends we would recommend investment in companies with debt free balance sheets,” Gallacher wrote.
The stock closed the day down 24 cents to $1.59.
[Link: OC Business Journal]
by The Editors on February 10, 2009
During the 2008 Q4/Year End conference call with analysts, VF Corp CEO Eric Wiseman said that the company will “remain very interested in acquisitions” for 2009. Though he said they were going to be very careful with their acquisitions and he didn’t mention any companies by name.
The biggest news of the call is that Vans is crushing, which isn’t news to anyone. “At Vans we enjoyed an extremely positive year,” said Stephen Murray, President of VF Corp’s Action Sports Americas. “Domestic sales were up 13 percent and we were up in every category except snow, and that is a small percentage of our business.” More Vans notes:
- Footwear sales up 11 percent
- Apparel and accessories grew by 40 percent
- Launch of boys apparel line was particularly successful
- Direct-to-consumer business grew 20 percent
- Vans stores saw an 8 percent increase in sales
- E-commerce grew by 40 percent
- The company plans to open more Vans stores outside California in areas where they feel their retail distribution is lacking
Follow the jump for info on Reef and VF Corp Overall. . .
[click to continue…]
by The Editors on February 10, 2009
Source Interlink (the parent company of the ASG Group) has decided that if the magazine companies aren’t going to pay the 7 cent per copy increase, then there is a conspiracy against them, according to a story on Folio.com.
Source Interlink filed a lawsuit on Monday claiming rival wholesalers, as well as publishers, are attempting to force the company out of business. . . . The suit, filed in New York federal court, seeks emergency court intervention to prohibit the defendants—including publishers Time Inc. and Hachette—from monopolizing the U.S. magazine wholesaler market, a Reuters news report said. In the suit, Source alleges that the defendants “conspired” to force the company to sell its distribution business at a steep discount to rivals Hudson News and News Group.
Questions: what does this mean for Surfer, Surfing, Snowboarder, and Skateboarder? If the distribution business is sold, then who will distribute the Source Interlink magazine titles? Or will those be sold, too?
[Link: Folio]
by The Editors on February 9, 2009
Looks like getting printed action sports magazines that last mile to the newsstand is going to get a little harder now that Anderson News has “suspended normal business activities,” according to a story on Folio.com.
The decision comes roughly three weeks after the Knoxville, Tennessee-based Anderson, along with fellow wholesaler Source Interlink, threatened publishers with separate 7-cents-per-copy price hikes. . . . Publishers largely balked at the 7-cents-per-copy surcharge and refused to pay, upset at the wholesalers’ sudden and “unilateral” decision to boost costs. . . . In a statement announcing the suspension, the company said it will “continue to hold discussions with publishers and retailers, trying to develop a viable model that allows it to remain in business.” Anderson said the situation is “a mess for us all.”
No doubt.
[Link: Folio]
by The Editors on February 5, 2009
Oh, the things being a publicly traded company will make you do. First, create a special line just for core retailers because distribution has mainstreamed all over hell. Then, after maxing out on the surf/skate/snow market that was the whole genesis of the brand, branch out into motorsports because if you’re not growing the shareholders get pissed.
Enter Volcom MX. NASCAR is next; or maybe they’ll just leave that to Electric.
[Link: Volcom.com/mx via Transworld Business]
by The Editors on February 5, 2009
With a knack for overstating the obvious, retail consulting group Customer Growth Partners President Craig Johnson lays down the bad news in a story on CNN:
This is not a good time for retailers. If people are fearful for their jobs, they will tightly hold on to their money and not spend it. This [situation] makes it very difficult for retailers.”
Really? What an insightful comment. For all the number from the major retail chains click here for a January same-store chart.
[Link: CNN]
by The Editors on February 4, 2009
According to MarketWatch Zumiez same store sales are down. . . again:
Zumiez (ZUMZ:7.18, -0.23, -3.1%) said late Wednesday that its January sales at stores open at least one year fell 14.8%. Analysts, on average, had expected the same-store sales to fall 14.1%, according to Thomson Reuters. Total net sales for the four-week period ended Jan. 31 decreased 2% to $20.3 million, said the specialty apparel retailer.
[Link: MarketWatch]
by The Editors on February 4, 2009
Source Interlink Co.s the parent company of the ASG Group (publishers of Snowboarder, Surfer, Surfing, and Skateboarder magazines) is denying that it is shutting down its magazine distribution business after major publishers pulled their titles from the magazine distributor thanks to the proposed 7 cent per issue fee Source was hoping to charge:
Gillis said the country’s biggest publishers, along with national distributors Curtis and Time Warner Retail, are shutting Source and Anderson out of the magazine supply chain in a bid to wrest pricing control away from retailers. “This is about American Media and Curtis and Bauer and Time Warner trying to control retailer pricing by eliminating magazine wholesalers so they don’t have so many they’ve got to do business with,” he said.
Guess it’s kind of hard to distribute magazines if no one is giving you magazines to distribute.
We’re kind of glad it only took two minutes to distribute this post to the world and that we didn’t have to deal with anyone to make it happen. No wonder print advertising is so expensive. . .
[Link: Foliomag.com]
by The Editors on February 2, 2009
NHS management breathed a sign of relief when the Consumer Product Safety Commission voted unanimously to postpone by one year a new federal law that would have required products made for children 12 and under to be tested for lead starting Feb. 10, 2009.
But that relief came after NHS’s owner Richard Novak had already laid off 17 employees because of sagging sales and worries about the new regulations.
A victory for good sense,” said Tim Piumarta, director of research and new product development at NHS, a Santa Cruz company with sales of $23 million a year. “This untenable legislation, as it was written by non-scientists in Congress, threw the entire global product supply channel into mass confusion.”
NHS and many other companies will now have a year to work out the lead details before complaining about it again next year.
[Link: San Jose Mercury News]
Nike plans to eliminate 4 percent of their 35,000 person work force (about 1,400 jobs) according to a story on Oregonlive.com.
