Two Fashion Bug Plus stores in Baltimore are closing as part of the national retailer's move to refocus and scale back operations in the face of weak sales sapping the apparel industry.
Charming Shoppes Inc., a Bensalem, Pa.-based chain operating more than 1,300 Fashion Bug and Fashion Bug Plus stores across the country, is shuttering shops by as early as January in the Parkside Shopping Center and on Wabash Avenue, store employees confirmed yesterday.
None of the other 22 Baltimore-area stores are closing and all of the estimated 20 displaced sales clerks and store managers will be relocated, according to employees contacted yesterday.
Company officials could not be reached for comment. But analysts said the chain, which focuses on women's apparel in shops averaging 8,000 to 9,000 square feet, is planning to close 60 stores while opening 47 -- a net loss of 13 -- over the next several months.
"This year, they're definitely more in a retrenchment," said Elizabeth Pierce Ladd, a retail analyst with Salomon Brothers Inc. in New York.
"It's symptomatic of the entire group. Retail in general is over-stored. Therefore, I expect to see a lot of consolidation and pruning of real estate."
The unforgiving retail environment has left Fashion Bug and other apparel retailers like Joppa-based Merry-Go-Round Enterprises Inc. to grapple with the capricious winds of fashion.
"Both are companies that for a long time did get it right, did offer customers what he or she wanted, and for both it was a time when the apparel business was good," said Sally H. Wallick, an analyst with Legg Mason Wood Walker Inc. "And then each got off track and made merchandising mistakes."
The result: Charming Shoppes recently reported an 18 percent drop in sales over seven months ended Aug. 26 compared with the same period last year, while sales in stores open at least a year fell 22 percent over the same time.
To reverse the trend, Charming Shoppes has brought in several new key executives, including a new president and chief executive. In addition, analysts said, the chain has been shoring up its financing, negotiating a permanent letter of credit to purchase merchandise overseas; until now, they said, Charming Shoppes has obtained financing on an ad hoc basis.
For all of the retailer's recent moves, analysts are uncertain whether Charming Shoppes can recapture its main customer: moderate-income "pink-collar workers," such as bank tellers who work in the service-sector, shop in strip centers and buy junior, misses and large size clothing.
"It remains to be seen," said Ms. Ladd of Salomon Brothers. "Six months ago, I was very concerned. Let's just say now they're in an interesting position."