Tag Archives: Business

Macy’s Is Making Its Own Version Of T.J. Maxx And Nordstrom Rack

The “off-price” channel, home of discounted designer goods, is the place to be in retail. Macy’s plans to pilot a new off-price chain as well as expand its Bloomingdale’s outlet locations.

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The success of T.J. Maxx and Nordstrom Rack is pulling Macy’s into the off-price chain game — and highlighting the pervasiveness of outlet culture in America.

The department store company, which announced plans last month to explore a set of off-price stores, said yesterday that executives are working on a pilot of a T.J. Maxx-like chain, as noted by Fortune. Notably, TJX, which owns T.J. Maxx, Marshalls, and Home Goods, today reported annual sales that surpassed Macy’s for the first time ever, underscoring the strength of its treasure-hunting business model.

Sapna Maheshwari/BuzzFeed / Via chartbuilder

The Macy’s off-price chain will differ from Bloomingdale’s outlets, which Macy’s is also expanding, Chief Financial Officer Karen Hoguet said on an earnings call with analysts.

“It may help bring a whole new customer to Macy’s,” she said on the call. “Initially, we were nervous about putting one of the Bloomingdale’s outlets too close to a Bloomingdale’s store, and what we found is it served as an entry point for the customer. And instead of taking business away from the base Bloomingdale’s store, we actually brought new customers who learned and got comfortable with Bloomingdale’s from the outlet experience, and then went to the Macy’s store. So it’s very possible we could find that with Macy’s as well.”

The move highlights the way Americans are shopping in a post-recession world, and the appeal of chains offering goods at a permanent discount. The rise of TJX has been meteoric in the past 20 years — the company reported annual sales of $29.1 billion today, surpassing Macy’s yearly revenue by a full $1 billion.

Shoppers, hungry for deals in a sluggish economy, and influenced by the low price points popularized by fast-fashion chains, are into the idea of off-price stores, which offer a unique value proposition. While T.J. Maxx and Marshalls sell private-label goods, their more than 900 buyers are always on the hunt for “order cancellations, manufacturer overruns, closeouts, and special production direct from brands and factories.”

They carry a wide array of labels, as illustrated by the #maxxinista hashtag shoppers are encouraged to Intagram and tweet with — Kate Spade, Diane von Furstenberg, Steve Madden, to name a few. To many shoppers, the retailer feels more like an outlet channel than many factory stores, where the vast majority of brands now make lesser-quality goods specifically for their outlets.

Nordstrom has doubled down on its own version of T.J. Maxx with Nordstrom Rack. There are now 167of its discount stores, compared to 116 full-price locations, and Rack represented the chain’s biggest source of new customers last year, executives said on an earnings call last week. Neiman Marcus is aiming for the market, too, with its Last Call chain. Rather than dumping excess goods into T.J. Maxx and Marshalls — which advertise that their prices are 50% below department-store chains — companies like Macy’s and Nordstrom can use their own off-price stores to try to sell them off themselves.

“The off-price sector is one of the few in retail that’s actually growing, so everybody has to pile into it,” Rick Snyder, an analyst at Maxim Group, said in an interview with BuzzFeed News. “It appeals to the consumer who really wants to get something nice, but really can’t afford to pay full price for it, or the person who wants to treasure hunt.”

“Knowing that 80% of outlet merchandise is actually direct-to-outlet, you have a much better chance of getting a real deal at a T.J. or a Ross than you are at an outlet,” he added.

Of course, Nordstrom executives said at a September 2013 conference that only 18% to 19% of merchandise in Rack stores is transferred from full-line stores. Other goods are special closeout buys from vendors, and Nordstrom is aggressive about maintaining the integrity of the pricing it displays on tags, Blake Nordstrom, the company’s president, said at the time.

Still, it’s not always clear whether you’re “really” getting a deal or not.

But for many consumers, it’s about the value they feel they’re getting, and there’s a special thrill in seeing the price they’ll pay versus the “suggested retail price.” Plus, with a T.J. Maxx or a Nordstrom Rack, they don’t have to travel to and through a whole outlet mall; they can find the store in a suburb and trawl through tons of different designers under a single roof.

As more and more retailers push into the “off-price” channel, what remains to be seen is what they’ll end up selling. Will they remain deal destinations?

“What eventually is going to happen is as this excess inventory sort of gets absorbed into all these new off-price distribution points, you’re going to find the same thing happening as what happens as outlets,” Snyder said. “Some percent, whether it’s 50%, 70%, or 80%, is going to be manufactured direct for the off-price channel, because there are only so many overruns.”

Read more: http://www.buzzfeed.com/sapna/macys-goes-off-price

Headscarf Case Cements The Abercrombie “Look” In Legal History

Under former CEO Mike Jeffries, Abercrombie & Fitch developed a hyper-specific look for its customers and its employees. That look has now stumbled its way into the Supreme Court.

Samantha Elauf (center) her mother Majda Elauf (left), and Equal Employment Opportunity Commission General Counsel David Lopes leave Supreme Court Wednesday. Chip Somodevilla / Getty Images

Abercrombie’s famously stringent “Look Policy” for sales associates–which specified everything from the maximum acceptable number of earrings (2) to the maximum length of fingernails (1/4 inch)–was discussed by the nation’s highest court today.

This, of course, has a significance all of its own: It means Abercrombie’s hyper-specific, borderline absurd dress code, enforced by former CEO Mike Jeffries, has been cemented in U.S. legal history for as long as this nation stands.

It also contributed to a more narrow debate in the Supreme Court, related to the company’s decision not to hire a 17-year-old Muslim woman in 2008, after determining her headscarf failed to comply with its look policy. Samantha Elauf, who scored well enough otherwise to be hired as a “model” at an Abercrombie kids store in Tulsa, Oklahoma, was told her hijab precluded her from getting the job, as it was against policy for models to don headwear.

A snapshot from Abercrombie’s 2013 “Hairstyle Sketchbook” Obtained by BuzzFeed / Via buzzfeed.com

The Equal Employment Opportunity Commission won an initial religious discrimination suit against Abercrombie that was filed on Elauf’s behalf, but another court reversed the ruling in 2012, saying a job applicant “must present the employer with explicit details sufficient to give it ‘particularized, actual knowledge’ before an employer need consider accommodating the applicant’s religious practices.’

That court said it doesn’t matter if a company has more knowledge than an applicant about how its rules might conflict with their religious practices. In other words, they said Abercrombie can’t be held liable for failing to accommodate Elauf’s headscarf, as it wasn’t the retailer’s responsibility to ask about it and her ability to comply with the look policy. Instead, the court said, it was Elauf’s fault for never informing Abercrombie that she wore her hijab for religious reasons and thus needed an accommodation. The Supreme Court listened to arguments today about whether the burden of asking for such a religious exemption falls on an employee or the employer.

Abercrombie argued that employers should not be forced to stereotype applicants as requiring religious exemptions and that Elauf should have figured out her hijab might violate the Look Policy and brought it up prior to the hiring decision. The EEOC contended that applicants are at a big informational disadvantage regarding a potential employer’s policies and that if a problem is sensed, it’s a company’s responsibility to start a dialogue.

“If she had told him, this is for religious belief and I need an accommodation from the Look Policy, at that point, under the statute, there would be a duty to accommodate,” Shay Dvoretzky, the lawyer arguing on behalf of Abercrombie, said today. “What we want to avoid is a rule that leads employers, in order to avoid liability, to start stereotyping about whether they think, guess or suspect.”

“The point is to initiate the dialogue,” Deputy U.S. Solicitor General Ian Gershengorn said, arguing on behalf of the EEOC. “Had that happened here, then we would be talking about a different point in the process about whether there was a reasonable accommodation that could be done and whether it could be done without undue hardship. But that dialogue never happened here, and that is the problem with the case as we see it.”

“This is what makes this a very important case…unlike employees, who are in a position to go back and forth with their employer and understand the work rules, applicants are at a serious informational disadvantage,” Gershengorn said. “They don’t know the work rules. And in this case, it is undisputed that (Elauf) did not.”

The justices exhibited their knowledge of 2008-era Abercrombie and its preppy fashions and ban on the color black while asking about the circumstances under which an employer can reasonably consider the possibility of a religious exemption.

Justice Alito outlined a situation in which four people show up for a job interview at Abercrombie — a Sikh man in a turban, a Hasidic man in a hat, a Muslim woman in a hijab and a Catholic nun in a habit. (He noted that he realized this would sound like the start of a joke, to laughter in the courtroom.)

“Do…those people have to say, ‘We just want to tell you, we’re dressed this way for a religious reason, we’re not just trying to make a fashion statement’?” Alito asked.

“One can certainly imagine cases in which it is more obvious than others that a particular garb is likely worn for religious purposes,” Dvoretzky responded. “There are some circumstances in which it is certainly more likely than others, but the question before the Court is to devise a rule that’s going to apply across the board..”

Abercrombie argued that it would treat any applicant with a head covering similarly, whether it was a hijab, a baseball cap or a yarmulke, and that the company is entitled to make style judgments in job interviews that result in hiring decisions. That argument didn’t fly over so well, however.

“If I walked into an Abercrombie interview wearing a suit, presumably Abercrombie could tell me, ‘When you come to work, please don’t wear the suit, please wear our clothes,'” Dvoretzky said “But it would also be equally rational for Abercrombie to say, you know, if this person is coming in wearing a suit, that’s not compatible with our style. And likewise for the headscarf.. (The district manager’s) testimony…is that he would have taken the same action for somebody who came into an interview wearing a headscarf, a baseball cap, a helmet or another religious symbol.”

Chief Justice Roberts shot back: “That doesn’t work in a case like this. It’s not a question, are you treating everybody the same. You have an obligation to accommodate people with particular religious practice or beliefs, so to keep constantly saying, ‘Oh, we would have treated somebody with a baseball cap the same way,’ doesn’t seem to me is very responsive.”

Justice Kagan noted that stereotyping in order to ask a job applicant about religious accommodation, based on a hijab or other indicator, is better than cutting them out altogether.

“You’re essentially saying that the problem with the rule is that it requires Abercrombie to engage in what might be thought of as an awkward conversation, to ask some questions,” Justice Kagan said. “But the alternative to that rule is a rule where Abercrombie just gets to say, ‘We’re going to stereotype people and prevent them from getting jobs. We’ll never have the awkward conversation because we’re just going to cut these people out and make sure that they never become Abercrombie employees.'”

The court is expected to issue a decision in the case by the end of June.

An Abercrombie spokesperson emphasized in an e-mailed statement today that the company “consistent with the law, has granted numerous religious accommodations when requested, including hijabs.” A more recent copy of the company’s look policy, obtained by BuzzFeed News and included below, supports that.

“The narrow issue before the Supreme Court is whether an employee who wants a religious accommodation must ask for one, or whether employers are obligated to guess and speculate about an employee’s religion to ascertain the need for religious accommodation,” the spokesperson said.

Abercrombie, the hottest teen retailer in the late 90s and early 2000s, has been struggling in recent years, losing sales and shuttering stores. Jeffries, the company’s modern-day founder who ran the company since 1992, was ousted in December. The executive was famously specific about dress codes in Abercrombie stores, and even had a 40-plus page manual specifying the appropriate behavior for staff on the company’s corporate jet.

The company says its stores now have more than 50% non-white staff today, up from less than 10% in 2004.

Obtained by BuzzFeed / Via buzzfeed.com

Obtained by BuzzFeed / Via buzzfeed.com

From the Supreme Court’s website:

Supreme Court / Via supremecourt.gov

Read more: http://www.buzzfeed.com/sapna/abercrombie-headscarf-case

The top ten horrible Halloween costumes that aren’t Ray Rice

Nowadays if someone sees a bad Halloween costume, it’s going to end up on internet. Halloween is still a few days away and we’ve already found some really bad costume ideas on Twitter.

 10. The “Invisible Pedestrian”

When you’re a kid knocking on strangers’ doors at night asking for candy, naturally the first rule is “safety first.” This costume could not be less safe it was made out of broken glass.

9. Baby Butt

Tobacco marketing aimed at kids is just getting ridiculous.

8. Ferguson Protester

Watch out for rubber bullets.

7. Toilet

Seriously, have some self respect. Actually this one could lead to some awkward situations if fellow party goers have had too much to drink

6. “Prison Princess”

“Prison Princess” is probably also a euphemism for something we’d rather not discuss here.

5. Human Centipede

Just no. Seriously. No.

4. Ice Bucket Challenge

Why not just use a real ice bucket?

3. Hashtag

This one’s for the people who really want to dress up as a major Obama administration foreign policy initiative.

2. Sexy Ebola Containment Suits

No wonder the CDC needed to change those protocols.

1. Beyonce’s Silhouette

It looks Charles Clymer morphing into “Rodan.”

Heh.

Read more: http://twitchy.com/2014/10/28/the-top-ten-horrible-halloween-costumes-that-arent-ray-rice/