“Fashion trends are important, but not all trends are suitable for this customer,” CEO Elizabeth Williams says. “What’s going to make this customer look good and feel good? Fit and comfort are crucial, and fit must be consistent. Also, a woman in this age range already has a wardrobe – she’s adding pieces to her closet.”
Avenue is a private brand – it develops its own products. “The eye should be drawn to the neckline, not the waist,” Williams says. “The length of the garment is also important. And we make sure our garments are easy care and machine washable.”
Avenue’s most direct competition comes from fellow specialty plus-size retailers Catherine’s and Lane Bryant. But it also competes with a range of other retailers from Chico’s to Macy’s to Target. “Everyone is getting into plus-sizes,” Williams says. “But the larger discount chains are sticking mostly to basics – not the ‘apparel to suit your lifestyle’ that we carry. And the other specialty retailers are aiming at either younger or older customers.”
The other advantages working in Avenue’s favor are high brand recognition and a loyal customer base – and new initiatives following the 2012 Chapter 11 filing and restructuring of the company under the new ownership of Versa Capital Management.
The lead-up to Avenue’s Chapter 11 filing included mismanagement of product, promotions, real estate and operations, according to Williams. The number of stores shrank from 433 in 2011 to 289 post-bankruptcy and the number of employees dropped from 4,200 in 2011 to 2,500.
Avenue has recruited a strong new executive team, starting with Williams, who worked at Macy’s for 12 years, Dayton Hudson for three, Sears for six and Charming Shoppes for 12. She came out of retirement to head Avenue because she loved its potential. “Turnarounds are exciting because you can start from scratch and build a solid framework for long-term sustainable growth,” she says.
Turnaround initiatives included analyzing product design, color and sizing, changing the model size to match the customer and changing sourcing from direct to domestic importers. “Our lead-times have dropped from eight to nine months before to four to five months now, based on how we’re sourcing our merchandise,” Williams says.
According to Williams, the new company has turned operations from cumbersome to streamlined, managers from implementers to decision-makers, real estate terms from unfavorable to favorable, expenses from excessive to realistic and product from outdated to on-trend. Before Avenue’s Chapter 11 filing, 269 stores were losing money; currently, only a few stores are still in the red. Within 19 months of emerging from bankruptcy, the company as a whole achieved profitability.
Its growth plans include opening more new stores, expanding product categories and increasing its customer base. With e-commerce, it plans to expand exclusive product offerings and enter new markets and categories.
The Avenue website was improved and relaunched this past summer. The redesign makes it easier for customers to find what they want, with easier-to-use navigation, better visual presentation of products including larger on-model images and clearer display of color and sizes, and the ability to see the shopping bag without leaving selling pages. The site also gives Avenue the ability to segment customers by shopping behavior.
Technical improvements include better search engine optimization and responsive design for mobile and tablet devices. The enhanced site is easier for the company to manage and execute pricing and promotions with flexibility.
“The biggest challenges at this point are continuing to have current trends available for our customer on a monthly basis and expanding our presence in the market place,” Williams says.
“Women usually have about five stores where they regularly shop,” she says. “For plus-size women, we want to be the first store where they shop.”