Chico’s – if you can’t beat Amazon, join ’em
We continue to hear about the retail apocolypse that is destroying brick & mortar retail. Each monthly Retail Sales report shows continued share gains by non-store retail sales, government speak for digital commerce, one of the core drivers of our Digital Lifestyle investing theme. Following the path blazed by Nike (NKE), Carter’s (CRI), Calvin Klein and even Sears (SHLD) – yes we said Sears – is selling Kenmore-branded appliances on Amazon in some markets, Chico’s FAS (CHS) is jumping on board.
For those unfamiliar with Chico’s it is a retailer of women’s “casual-to-dressy clothing, intimates, and complementary accessories” which sounds like something in the cross-hairs of Amazon’s own private label clothing effort. Some retailers like J.Jill (JILL) are looking to build their own digital commerce platform, but Chico’s move is less capital intensive and allows for it to leverage Amazon’s formidable logistis. Not a bad idea for a company whose top line appears to be stagnating.
Chico’s is the newest retailer to set up shop on Amazon. Beginning in mid-May, a select assortment of Chico’s brand merchandise will be available on Amazon. This includes the company’s core collections, Travelers, Zenergy athleisure, no-iron shirts, So Slimming pants and Chico’s jewelry.
All Chico’s merchandise will be eligible for free shipping through Amazon Prime. Chico’s FAS will maintain control of marketing, pricing and promotions for its products on Amazon.
Based on sales, additional Chico’s merchandise, such as White House | Black Market and Soma products, will likely be added in the future, according to the company.
