Update on Retail Bankruptcies in 2014

The first half of 2014 has seen a number of regional apparel and other retail bankruptcy filings, starting with the January filing of Dots. While initially planning to reorganize, the 27-year old retailer was forced to liquidate its 400 locations after a viable sale of the chain failed to materialize. Ecko and Brookstone filed in April and ended up conducting 363 asset sales, while Coldwater Creek moved quickly to liquidate its 365 stores. More recently, Love Culture filed for bankruptcy, the victim of unprofitable leases and severe cash drain due in part to investments it made in its online business. Continue reading

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What’s Left for Retail M&A in 2014?

The first half of 2014 may have been slow from a sales perspective, but retail and consumer products executives are not pulling the brakes on deal flow.

In fact, Dealogic reported in July that the value of announced deals in the global consumer products industry had reached $69.7 billion during the first half of 2014, almost four times the $18.8 billion seen in the same period last year and the highest since 2008. Dealogic data also indicates that retail is having the best year since 2005, with $31 billion in deals so far in 2014.  Continue reading

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Three Tips for Franchising Success

Earlier this month, we had the pleasure of attending and sponsoring the annual FaegreBD Franchising Summit. While slowed consumer spending and a lively national debate around minimum wage rates and unionization have made for a challenging climate, franchising leaders are resilient and committed to the business model. Continue reading

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Marketplace Fairness Act: Is Change Around the Corner?

Congress has shelved and unshelved the proposed Marketplace Fairness Act for years now. The act, which the House passed in July and is expected to hit the Senate floor this September, focuses on enacting legislation that would allow states to collect the sales and use tax from Internet or remote sellers. At the most basic level, the act would levy a tax on online purchases. Continue reading

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Breaking Down Walls: Four Trends Reshaping the Future of Brick-and-Mortar

Digital’s transformative influence in retail is a theme that my colleagues and I have written about extensively, and it’s real. But despite all the headlines surrounding the growth of e-commerce and mobile sales, there’s a glaring figure that’s often overlooked: With only five percent of total U.S. retail sales being made through exclusive online retailers, such as Amazon, and another five percent via the online channels of traditional brick-and-mortar stores, the remaining 90 percent of retail sales still occur in-store. In other words, brick-and-mortar is—and will continue to be—a vital fixture in the industry moving forward at least for the near future. In fact, even some of the most successful brands that began online—including Birch Box, Warby Parker and Rent the Runway—have experimented with or permanently set up shop in a physical location.  Continue reading

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Retailers Reconsider In-Store Floor Space, Turning Department Stores into “Mini-Malls”

As retailers balance the increasing need for varied products and the decreasing need for space, many large anchor tenants like Macy’s and J.C. Penney are choosing to lease their square footage to specialty retailers, creating “stores-within-a-store” or “mini-malls.”

These sublease arrangements can provide various benefits to the anchor tenants. For example, they can: Continue reading

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BDO Knows Retail & Consumer Products Alert: What Does a CEO/CFO Need to Know about an Inversion Transaction?

Over the last several months, a number of major U.S. corporations, including Walgreens most recently, have announced tentative plans to relocate their headquarters abroad. This complex practice, known as an “inversion transaction,” can significantly reduce corporate income tax liabilities for businesses. However, it’s also currently subject to increased levels of scrutiny from Congress, shareholders and the public. With the scope and number of these transactions on the rise, and with the issue now in the international spotlight, it’s increasingly important that retail and consumer products companies understand what exactly inversion involves, as well as its potential advantages and risks.

For these insights and more, read our latest BDO Knows Retail & Consumer Products Alert, and let us know your thoughts and questions in the comments section below.

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Mid-Year Retail IPO Outlook – All About Alibaba?

This week the NRF lowered their expectations for retail sales growth in 2014. The group adjusted its forecast to a 3.6 percent increase for the year, down from the 4.1 percent increase they had predicted in January. Still, they were bullish for the second half of the year, noting that consumers are likely to feel more optimistic about spending in the months ahead. With back-to-school on the horizon and holiday preparations already underway, what is the outlook and appetite for IPOs in the retail and consumer industry during the back half of the year? Continue reading

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Christmas in July? Natalie Kotlyar Weighs in on the 2014 Holiday Shopping Season

It may still be July, but retailers have been hard at work for months in an effort to prepare for the 2014 holiday shopping blitz. Last season, digital trends significantly impacted sales, pushing retailers to reconsider and reshape their strategies in order to maintain their competitive advantage during the busiest time of the year. As our own Natalie Kotlyar recently discussed in Retail TouchPoints2014 Holiday Outlook Guide, retailers are now focused on leveraging last year’s digital success stories and lessons learned to stay ahead of the pack and distinguish themselves in today’s extremely competitive market. Continue reading

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