Dressbarn Is The Latest Retail Brand Doomed To Disappear
The New Jersey-based Ascena did not say when the closings would take place, merely that it will close the stores eventually and that it has tapped A&G Realty Partners to assist with real estate matters related to the process. For now all Dressbarn stores are open, as is the brand's website.
"This decision was difficult, but necessary, as the Dressbarn chain has not been operating at an acceptable level of profitability in today’s retail environment," Dressbarn Chief Financial Officer Steven Taylor said in a statement.
According to Ascena, the closure will have no impact on the company's other woman's clothing brands, and will in fact strengthen its overall financial performance.
Ascena's recent financial performance has been poor. The company suffered more than $1B in losses over the past four years and is carrying about $1.6B in debt, according to data compiled by Bloomberg.
In a separate effort to improve its bottom line, Ascena recently sold its Maurices brand, a discount retailer, to European investors for about $300M. The company still owns a variety of other women's fashion brands.
Dressbarn is the company's only other discount chain, but Ascena also owns upmarket Ann Taylor, Loft and Lou & Grey, along with the plus fashion specialists Lane Bryant, Catherines and Cacique, and tween specialist Justice. Ascena owns about 3,500 stores all together.
The overall retail environment has been difficult on clothiers lately, with sales growth nearly flat in that retail segment.
Sales at clothing and clothing accessory stores dropped 0.2% in April compared with the month before, and only eked out a gain of 0.2% in sales compared with April 2018, according to the Census Bureau.
Discounters like Dressbarn are seeing stiff competition from fast-fashion chains like H&M and Zara, which are winning over a growing number of younger shoppers, as well as heat from the omnipresent Amazon, Bloomberg reports.
Though the Dressbarn closures represent the demise of an entire brand, they don't represent the first round of shuttered stores for Ascena. About two years ago, the company downsized hundreds of its locations, including Ann Taylor, Dressbarn and Lane Bryant.