Sears Shouldn’t Even Attempt Fast Fashion

by James Brumley | March 28, 2014 10:18 am

Sears Shouldn’t Even Attempt Fast Fashion

Kudos to Sears Holdings (SHLD[1]) for being willing to make changes in an effort to turn its business around.

Sears185 Sears Shouldnt Even Attempt Fast FashionToo bad its recently introduced strategy — “fast fashion”[2] — is going to be too difficult for the struggling retailer to execute.

The basics of Sears’ new fast fashion strategy: Through in-store floor space designated as “Here + Now,” Sears aims to rapidly source, stock and, sell through trendy fashions in a matter of weeks — if not days — rather than the usual multimonth cycle that department stores normally need to secure and sell inventory.

The goal is to meet the ever-changing fashion needs of teens, tweens, and even (very) young adults, as shops like H&M (HNNMY[3]), Forever 21 and Bebe (BEBE[4]) have successfully done, and done so at affordable prices.

Sears will be able to compete based on price, for sure. But it’s unlikely SHLD will ever be able to muster the quick turnaround time it needs to become a true fast fashion player.

Why Sears Will Stumble With Fast Fashion

While there’s no clear-cut definition of fast fashion, those who have a good grasp on the idea recognize that Zara is as good of a prototype for the idea as any other player out there. Zara is capable of designing, manufacturing, and getting garments on its store shelves in a month[5]. That means the looks seen on catwalks in March could literally be mimicked and on Zara’s shelves in April.

Other boutiques like Bebe and Forever 21 still outsource the manufacture of their apparel, but being smaller retailers with less square footage to stock (and presumably good relationships with their suppliers), these nimble companies can respond to pop-up trends just as quickly as self-sourced names like Zara can.

Will Sears Holdings be able to replicate the process in its own stores?

I doubt it.

For starters, this is going to be an awkward shift in the way Sears approaches handling inventory. Most department stores buy an entire season’s clothing lineup four months in advance, at least. Staggered deliveries of those goods can mean the merchandise arriving in stores could have been selected as much as six months earlier — a virtual eternity in the world of fashion.

For Sears’ Here + Now shops to truly deliver fast fashion, SHLD will need to completely overhaul the way it chooses and orders apparel for its juniors department. That likely will mean new manufacturers must be brought on board.

Such paradigm shifts are difficult to make, however, particularly considering how Sears Holdings is a logistic-centric retailer largely managed by a committee of warring factions[6] … consisting of people who understand accounting statements but might not understand fast fashion.

Even if the department store chain does manage to get the logistics part of fast fashion down, there’s still the issue of spotting new fashion trends to quickly copy, then designing appropriate looks, or trusting the manufacturers to come up with the right looks and fashions … all within a matter of weeks.

While it would be unfair to say Sears’ buyers and fashion-oriented folks are completely off the mark in terms of fashion sense, the people at Forever 21, Bebe and Zara have been doing fast fashion for a while now.

Sears has a steep learning curve ahead of it; it’s not exactly known as a trendy teen shopping destination.

Bottom Line

It’s admittedly a fresh idea from a company that’s in desperate need of fresh ideas. And Sears Holdings most definitely has the pedal to the metal with letting the world know it’s aiming for relevancy again. Case in point: The retailer has also partnered with Seventeen magazine[7] to create a clothing label for juniors/teens; select stores will even play host to Seventeen-branded boutiques.

The problem is, teenage girls can be some of the most vexing, cruel, fickle consumers on the planet, and they can spot a fashion faux pas a mile away. If Sears executes this plan with anything less than perfection, it’s only going to do more damage to its already-shaky reputation.

My prediction: Fast fashion is apt to end up being something Sears wishes it had tested and tinkered with first before rolling it out company-wide and touting the daylights out of it.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

Endnotes:
  1. SHLD: http://studio-5.financialcontent.com/investplace/quote?Symbol=SHLD
  2. “fast fashion”: http://chainstoreage.com/article/sears-debuts-new-omni-channel-fast-fashion-format-april
  3. HNNMY: http://studio-5.financialcontent.com/investplace/quote?Symbol=HNNMY
  4. BEBE: http://studio-5.financialcontent.com/investplace/quote?Symbol=BEBE
  5. in a month: http://www.npr.org/2013/03/11/174013774/in-trendy-world-of-fast-fashion-styles-arent-made-to-last
  6. logistic-centric retailer largely managed by a committee of warring factions: http://www.businessweek.com/articles/2013-07-11/at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-troubles#p1
  7. partnered with Seventeen magazine: https://fashiontech.wordpress.com/2014/03/27/10404/

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