Minneapolis—In the wake of an increased fourth quarter loss, Joel Waller, interim ceo at Christopher & Banks, vowed to “regain lost business” by cutting base merchandise retails by 20% this year.
Waller, who replaced Larry Barenbaum who resigned last month, told analysts in a conference call on Tuesday that new merchandise, some priced 23% higher, brought in for holiday was a mistake, one that turned off the store’s core consumer.
For its quarter ended Jan. 28, the specialty retailer reported a net loss of $31.7 million, or 89 cents a share, compared with a net loss of $16.7 million, or 47 cents a share, in the same quarter a year ago. Net sales totaled $68.8 million with comparable store sales down 14%.
That was below analysts’ average estimate which forecast a loss of 47 cents a share on sales of $94.28 million.
“Our financial results were clearly disappointing in the fourth quarter, primarily due to a merchandise offering that was priced too high, over-assorted and lacked some of our traditional key categories,” said Waller. “However, I do believe that by developing and executing on the right strategic plan we can get the company back on track.”
New Planned Promotional Calender
That will include a pricepoint roll back effectively eliminating the price increases that arrived with the holiday merchandise. In addition the retailer will reduce the categories of merchandise in stores and instead increase depth in a few key product categories.
He also said Christopher & Banks will adopt a smarter approach to promotions. Instead of discounting to clear out stocks of unsold inventory, the retailer will develop a planned set of price promotions throughout the year.
Waller, whom Barenbaum originally appointed as president, added that “since joining the company in mid-December, I have found that Christopher & Banks has a loyal customer, giving me the confidence that we can win her back. My priority is to bring stability to the organization while testing and developing merchandising and marketing strategies that will resonate with our customers.”
In November, the company announced a strategic review that included closing about 100 underperforming stores and laying off hundreds of employees. Now the company says 103 stores were slated for shuttering, with most closing by the end of this month.
While the company said it would this year would see “a limited number of store openings and thus minimize capital expenditures,” its plans called for converting 22 dual stores where a Christopher & Banks and a C.J. Banks stores were combined into one location.
An additional 20 dual stores were created by adding plus-sized merchandise to existing Christopher & Banks stores.