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It’s been another week with far more retail news than there is time in the day. Below, we break down some things you may have missed during the week, and what we’re still thinking about.
From eBay’s latest investment to Lowe’s throwing birthday parties, here’s our closeout for the week.
What you may have missed
1-800-Flowers launches a marketplace
In addition to floral arrangements, 1-800-Flowers.com has expanded its assortment by launching a new marketplace dubbed Gifts & More. It features over 200 new brands and 15 product categories including home décor, spa gift baskets, party supplies and DIY activities.
“This addition will help us continue to bring new trends to market as we support local independent sellers, providing them with an innovative platform to sell their goods on a national scale,” Abhay Patel, president of 1-800-Flowers.com, said in a statement.
EBay invests in luxury platform Cudoni
Ebay’s venture arm invested $9 million in Cudoni, according to Business of Fashion. Cudoni is a luxury resale site based in the UK that sells throughout that region and Europe. Cudoni helped raise a portion from existing investors like Andrew Jennings and The Daily Mail Group Ventures. It sells from over 4,000 luxury brands ranging from clothing to jewelry, and more.
Cudoni’s site states that sellers on the platform receive extensive market research and knowledge from specialists in order to maximize all possible earnings. Ebay is investing in apparel resale during a time of exceptional growth for the segment. The money will go toward sales and marketing functions at Cudoni.
Class-action lawsuit filed against Foot Locker under California privacy law
A class action lawsuit was filed against Foot Locker on Monday, alleging the retailer acted in violation of the California Invasion of Privacy Act. The plaintiff is asking for $25,000,000 in damages.
The suit claims that Foot Locker “ignores” CIPA’s rules on wiretapping and eavesdropping of electronic communications by using an embedded code in its chat feature that “records and creates transcripts of all such conversations,” according to court documents. Those court documents allege that Foot Locker eavesdrops by allowing “at least one independent third-party” to intercept the communications and store transcripts, all without proper consent.
Several retailers have been hit with lawsuits under CIPA, as Sephora settled a suit for $1.2 million in August. Meanwhile, Crocs and Adidas are both actively dealing with separate litigation related to CIPA.
Retail Therapy
Levi’s CEO misquotes Mark Twain about skinny jeans
Mark Twain is famously one of the most misquoted people of all time, and Levi’s CEO Chip Bergh this week piled on with one of the better-known Twain distortions.
Bergh told an analyst who asked about the supposedly dying skinny jeans trend that two such styles are still the bestsellers in women’s. “As Mark Twain once said, ‘The news of my death has been greatly exaggerated,’” he said. “I’ve been known to say skinny jeans will never die.”
Twain did say something like that, in an attempt to quell a rumor that mixed him up with a gravely ill cousin, according to Professor Joe Fulton, a Mark Twain scholar at Baylor University. The accurate quotation: “The report of my death was an exaggeration.”
But, according to Fulton, there may be a stronger tie between Levi’s and Twain than Wednesday’s Q4 earnings call. Twain – who was 18 when Levi’s was founded and spent pivotal years in its original trading areas – may very well have been a customer.
“It seems very likely Twain did wear blue jeans, possibly even Levi blue jeans, during his time in the Nevada Territory and California,” Fulton said by email. In the semi-autobiographical “Roughing It,” Twain describes “pantaloons” modified with “ample additions of buckskin, to do duty in place of leggings, when the man rode horseback so the pants were half dull blue and half yellow, and unspeakably picturesque.”
Twain, most often pictured in a light three-piece suit and shock of white hair, wrote about acquiring a taste for western style, though he doesn’t specify Levi’s or blue jeans, Fulton said.
“I had grown well accustomed to wearing a damaged slouch hat, blue woolen shirt, and pants crammed into boot-tops, and gloried in the absence of coat, vest and braces,” Twain said. “I felt rowdyish and ‘bully’…”
No word on whether his pants were a skinny cut, or closer to the “looser, baggier fits” that Bergh said drove half of Levi’s sales of bottoms in the fourth quarter.
Lowe’s wants kids (and parents) to Build-A-Birthday
The North Carolina-based home improvement retailer said last week it’ll begin offering birthday party packages for kids. The packages include DIY projects for 12 to 20 kids ages 5 and up, who can choose to build projects like a butterfly house, a sports arena, wooden castles, race cars, or custom peg wall shelves. It’s an extension of the company’s existing kids’ DIY weekend workshops.
Image courtesy of Lowe’s.
A Lowe’s employee will serve as “party captain” and monitor the partygoers, who get to wear safety goggles, aprons and “party construction hats.” The packages start at $349 and upgrades including party favors and pizza, drinks and desserts from Domino’s can be added. The party packages will initially be offered at 10 stores in New York, New Jersey, North Carolina, Indiana, Illinois, Tennessee, Texas, Arizona, Utah and California.
What we’re still thinking about
$300M
That’s how much Serta Simmons hopes its funded debt will shrink to, from around $1.9 billion, under a restructuring agreement. The mattress manufacturer on Monday filed for Chapter 11 bankruptcy protection, which CEO Shelley Huff said would leave the company with “a stronger financial foundation to drive profitable growth.”
Serta on Tuesday filed a lawsuit related to the terms of a 2020 loan. The loan helped the retailer’s finances at the onset of the pandemic, lowering its interest expense, increasing its cash position to $300 million and lowering its debt by $400 million.
65
That’s how many U.S. employees were laid off by DTC athleticwear brand Gymshark this week. The layoffs, which impacted employees in the brand’s Denver office, are part of a U.S. restructuring.
The brand, based in the U.K, employees around 900 employees globally.
“We are taking this move purely for commercial reasons to centralize our operations and continue to safeguard the future of the business,” according to a company spokesperson.
What we’re watching
The bad news in retail keeps on coming
So far, 2023 has carried on two trends from the end of 2022 that retailers would probably rather do without: layoffs and increasing financial distress. The pace of bankruptcies in the industry has picked up once again, with Sears Hometown filing for Chapter 11 at the end of last year and Party City and Serta Simmons joining it this month. The distressed list is longer than that, though, with Bed Bath & Beyond and Rite Aid also on the watch list for bankruptcy.
Even retailers that don’t feel the need to file for bankruptcy are turning to deep cost-cutting measures, including layoffs. Just this week, the e-commerce businesses of Hudson’s Bay and Saks Off 5th confirmed layoffs and activewear brand Gymshark cut 65 U.S. employees. Over the month at large, popular DTC brands Wayfair and Everlane both announced job cuts, and Amazon increased its layoff count. It’s tough times in retail for everyone, but the financially vulnerable and the e-commerce-dependent are getting hit hardest.
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