Ann Taylor and Lane Bryant’s parent company announced it will close as many as 667 stores in the next two years. Ascena Retail Group Inc., which owns both the business casual and plus-size women’s clothing stores, said that 268 stores are closing while 399 stores will close if rent agreements can’t be made.
Ascena owns both Ann Taylor and Lane Bryant, along with Loft, Maurices, Dressbarn, Catherines and girls’ clothing retailer Justice. While chief executive David Jaffe didn’t specify which stores will close, he did indicate that all subsidiary chains would be affected. Store traffic has declined and Jaffe pointed to the rise of e-commerce as an important factor. He explained,
“We expect these factors will remain major headwinds for the foreseeable future and reflect an accelerated shift to consumer demand toward e-commerce.”
Online shopping’s consumer shakeup impacts more than just Ascena’s group of stores. E-commerce affects all levels of retail from luxury to typical mall stores. The L.A. Times reports that department chains Macy’s, Sears and J.C. Penney are all closing stores. In the meantime, Payless ShoeSource Inc. and Gymboree Corp. have both filed for bankruptcy. On the luxury end, Michael Kors recently announced that they will be closing up to 100 stores. Meanwhile, Ann Taylor’s direct competitor, J.Crew has also seen serious declines in recent years. Currently, they are in the midst of a huge shakeup. In the last two months, both creative director Jenna Lyons and CEO Mickey Drexler have announced their departure from the company.
The decline of in-store sales for Ascena chains is striking. A year ago, its third quarter profit was $30 million dollars. This year, that profit was only $9.6 million. With those kind of numbers, its no wonder that Credit Suisse predicted that between 20 and 25% of America’s malls will close by 2022.