Betsey Johnson's Closing Doors Opens Opportunity for EXPR and KORS
Privately held long-time luxury retailer Betsey Johnson has seen the last of its flowery patterns and animal prints. The funky, gleefully spirited brand is going out of business, as it has been announced that an "everything must go" blowout sale has begun and will extend until everything is off the shelves, including the actual shelves themselves.
During the 20-50% off sale, customers can purchase the newest Betsey styles at a discounted rate with no chance of return. Inventory will not be replenished following the final sale of items, including the actual décor that furnishes the iconic and eclectic 54 Johnson stores and nine outlets.
It was announced on Facebook (NASDAQ: FB) just a few hours ago that the brand would be hosting its final sale, with fans of the prom-attire line begging, "Please don't close!"
In a statement released on May 10, Chief Executive Officer Jonathan Friedman sympathized with teenage girls and women across America that are mourning the loss of the stylish retail brand.
"While the sales are ongoing, Betsey Johnson customers are still our main priority. We hope that they use this opportunity to find great discounts on all of the latest Betsey Johnson fashions," Friedman said.
While Betsey and her fans may be crying tears flecked with cobalt blue eye shadow and chunks of thick black mascara, other high-end retailers are able to rejoice at the prospect of attracting her groovy clientele.
Michael Kors (NYSE: KORS) could potentially see shares being bought up by investors following the demise of Betsey Johnson, as it recently experienced a sell-off of shares following Fossil's (NASDAQ: FOSL) dismal first quarter results. Her loss is his gain, as the two brands compete at a comparable price level and attract a fairly similar customer base.
Likewise, Express (NYSE: EXPR) has seen a recent spike in men's retail spending, but have lost some of their women fan base. According to Piper Jaffray, men have been picking up their fashion game lately, and the ladies in their lives are likely not far behind. With this extra push from Betsey Johnson's abandoned female shoppers, there is an even better chance that EXP will experience better-than-expected summer months.
For many women, today marks the beginning of the end of an era with the news that Betsey Johnson will soon cease to exist. Merchandise is expected to sell at warp speed, as the brand is known to sell most inventory at full price until it is pushed to off-price stores such as T.J. Maxx and Marshalls (NYSE: TJX). With the discounted price tags and coveted outfits, Betsey Johnson has seen the end of its retail reign.
EXPR is currently trading at $23.53, up 17.95% year-to-date, while KORS is trading at $40.14, up 47.34% year-to-date.
Latest Ratings for FB
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