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[5 comments]

Lands' End gets off to a good start post Sears

June 17, 2014

Lands' End celebrated its fiftieth anniversary last year, but the bigger news for company in 2013 was the announcement that it was being spun off by its parent company, Sears Holdings. So far, so good for Lands' End as the casual clothing brand and retailer announced a 3.6 percent increase in sales during its first quarter sans Sears. The company's same-store sales were up 3.4 percent during the period.

"We are excited to be operating, once again, as an independent public company and believe we are well positioned to execute against our strategic initiatives to drive sales and earnings growth," said Edgar Huber, president and chief executive officer, Lands' End, in a statement.

Mr. Huber said Lands' End used improved assortments, targeted promotions and inventory management to help improve its gross margins and operating income along with sales. He said the company was "focused on improving the contemporary relevance of the Lands' End brand."

Sears Holdings CEO Edward Lampert has said in the past that Lands' End has the potential to become a $5 billion global brand. Sears first acquired Lands' End in 2002 for $1.9 billion.

In a RetailWire poll last October, 73 percent rated the chances of Lands' End achieving success apart from Sears Holdings as good (38 percent) and excellent (35 percent).

Discussion Questions:

What will it take for Lands' End to build on its positive first quarter going forward? What rivals should be most concerned about Lands' End now that it is no longer part of Sears Holdings?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Are you more or less optimistic about Lands' End's prospects on the heels of the company's first quarter earnings report?

Comments:

One quarter does not equal a long-term trend, but the early signs for Lands' End are encouraging. If the company emerges from the shadow of Sears Holdings and continues to focus on the fundamentals (merchandising, promotions and inventory management) it should continue to grow. Lands' End luckily survived its years of ownership by Sears with most of its brand equity and reputation intact.

As a growth opportunity, Lands' End is different from most retailers who have too much square footage and not enough web presence. This may be one case where a bigger brick-and-mortar footprint (limited mostly to its Inlet stores today) can help the overall brand strategy. Certainly Eddie Bauer is the competitor most likely to lose market share at the expense of a thriving Lands' End.

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Dick Seesel, Principal, Retailing In Focus LLC

Lands' End needs to take us back to the Lands' End we knew and introduce that version of Lands' End to the Millenial world. They used to be a loud brand and after Sears got them they went quiet. Now is the time for Lands' End to bring back yesterday in the context of today. This means across their merchandise mix, marketing and channels. This has to be a careful effort, so that they do not alienate their Baby Boomer shoppers while they chase Millenial money. Balance, Lands' End—balance as well as your canoes do.

 

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Tom Redd, Vice President, Strategic Communications, SAP Global Retail Business Unit

Lands' End disappeared when they were owned by Sears. It is good for them, and us, that they are now regaining their position as a brand to be desired.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

Take a bath, Lands' End. Wash off the dust of Sears and become your former self. Your rivals will take notice that you are back, and they will have to sharpen their game.

It may not be "Happy Days Are Here Again," but there will be one less eddy in the retail river.

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Gene Hoffman, President/CEO, Corporate Strategies International

The fact that Lands' End survived its ownership by Sears Holdings with even a modicum of brand equity left is a testament to the heritage/strength of the brand and suggests that the company does have the opportunity to re-introduce/introduce its wares to a whole population of consumers who wouldn't set foot in a Sears store.

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Kelly Tackett, Research Director, Planet Retail

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