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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Alighieri who wrote (522010)	10/20/2009 11:15:51 AM
From: one_less	1 Recommendation Respond to of 1588157

Retailing Expert Advises Some Specialty Retailers To Abandon The Mall And Put More Emphasis Into Online Sales 67 WALL STREET, New York - October 19, 2009 - The Wall Street Transcript has just published its Online And Direct To Consumer Retailing Report offering a timely review of the sector to serious investors and industry executives. This 38 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online. Topics covered: Online Retailer Profit Margins Vs. Bricks-And-Mortar Retailers - Uptick In Internet Commerce - Secular Shift In Market Share To Internet Retailers - Post-Crunch Consumer Confidence - Growing Market Share For Online Travel Agents - Possible Consolidation Of HSN, Inc. - Amazon As The "Wal-Mart Of The Internet" - Online Marketing Vs. In-Store Marketing - Maximized Markdowns - Online Traffic Conversion Rates - Social Networking To Drive Brand Awareness - Online Sales Holiday Outlook - E-Commerce As A Path To International Expansion Companies include: Abercrombie & Fitch (ANF); Amazon (AMZN); Ann Taylor (ANN); Apple (AAPL); Ask.com (IACI); Bebe (BEBE); Best Buy (BBY); Bidz.com BIDZ); Dell (DELL); Dick's Sporting Goods (DKS); Expedia (EXPE); GSI Commerce (GSIC); GameStop (GME); Gap (GPS); General Motors (GM); Google (GOOG); HSN (HSNI): Hot Topic (HOTT); Interactive Corp. (IAC); Liberty Media Interactive (LINTA); LivePerson (LPSN); MercadoLibre (MELI); Move Inc. (MOVE); Orbitz (OWW); Pacific Sunwear (PSUN); Quiksilver (ZQK); Ralph Lauren (RL); ShopNBC/ValueVision (VVTV); South Korea's Gmarket (EBGMy); Sport Supply Group (RBI); Staples (SPLS); Starbucks (SBUX); Target (TGT); Timberland (TBL); Urban Outfitters (URBN); VeriSign (VRSN); Wal-Mart (WMT); WebMD (WBMD); eBay (EBAY); hhgregg (HGG); priceline.com (PCLN). In the following brief excerpt from just one of the interviews in the 38 page report, an industry expert discusses the outlook for the sector and for investors. Brian Sozzi is a New York-based Analyst for Wall Street Strategies, Inc. He covers the apparel/hardline goods sectors of the retail industry. Mr. Sozzi is a frequent contributor to Fox Business Network, Forbes, Bloomberg, The Wall Street Journal and other media outlets. Mr. Sozzi: Retail is kind of intriguing. You have to sit back and take a hard look at what the asset base is. Let's take specialty apparel, for example. The asset base in specialty apparel is the brand name because these companies don't own land, they own maybe one or two distribution facilities, some of them own none, and they have a ton of operating leases as a percent of total revenue. So you're paying a likely premium for an intangible asset, a brand name, and I don't know if you want to pay that premium given the ever-changing circumstances of retail and the outlook for the sector five years forward. Right now I say, for instance, that Urban Outfitters is a great company. But one slight change in broader fashion trends and missed execution by management, and their earnings can plummet pretty significantly over the course of a year. "Be careful what you pay for" is a good way to put it. TWST: Are there any names that stand out as being really at risk or possibly not surviving this recession? Mr. Sozzi: One example that falls within my sector coverage is Quiksilver (ZQK). Quiksilver is dealing with significant issues. It's heavily leveraged and made a really bad acquisition back in 2004 for a ski business, which they sold for next to nothing earlier in the year. Unfortunately, they are unable to delever the business, as they're operating within a model of surf wear-inspired gear that is not in line with the strong fashion trends in retail currently. So here lays Quiksilver with a shift in its business, a ton of debt and tepid global consumer base, and one has to wonder if survival into 2011 is likely. TWST: What are the top one to three things that you'd like to you see these companies do in 2010 related to the online sides of their businesses? Mr. Sozzi: First and foremost, many of these companies have a good portion of lease renewals coming up. I don't want to see them re-signing leases. I want to see them completely exit these markets where the economics of the market no longer make sense. Pacific Sunwear (PSUN), I believe, has over 300 lease renewals up over the next two years. I don't want to even see them entertain to stay in certain underperforming malls where anchor tenants have left. The stores in question are in bad locations economically, so even if you get lower rents, who is to say it's low enough? So that is rooted in what I call the new realities in retail, where consumers increase savings, meaning what dollars allocated to spend are funneled to a select few who were there for their customer base in 2008 and 2009 in terms of price and merchandise quality. More broadly, I want management teams thinking about how they can improve productivity with the stores already opened. How can you improve manufacturing functions? How can you improve brand awareness? How can you improve the close rates of your associates? Those are things I'd be thinking about - thinking within your current box. TWST: Is that because of the recession or just because they could do more sales online and don't need that physical space? Mr. Sozzi: Online is where retail is heading. It's cost-effective and more consumer engaging. Today you can go on Gap's Web page and pull up 20 pages of sale items. Even in good economic times, the sales will be there. Chances are a consumer has went into the store, they know what the product feels and fits like, so why not just order online if you're going to save 25% to 50%? I think retailers have done a great deal to push the envelope online, whether it's through blog pages, customer reviews or unique merchandise, but none of these attributes, by and large, were available to consumers at the click of the mouse in recent years. The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 38 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online . The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations. finance.yahoo.com