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Ascena closes Brothers stores and reshuffles Justice

By Angela Gonzalez-Rodriguez

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Business

Ascena Retail Group, Inc. (ASNA), has announced that, as part of a strategic review of its Justice business, it has decided to close its Brothers brand. Besides, it will take Justice’s range back to basics.

Operations are expected to be fully wound down by the end of the company’s fiscal year, reported ‘MarketWatch’.

In this regard, Ascena CEO David Jaffe recognized that they are “mindful of the impact this decision has on our customers and associates. At this point in its evolution, it is appropriate for Justice to focus on its core girls business, including refinement of its merchandise assortment and overall marketing strategy.”

The company has stressed however that wind-down costs associated with the decision to close Brothers are not expected to be material to the retailer’s financials.

For fiscal 2014, Brothers represented less than 1 percent of the total Ascena’s 4.79 billion dollars revenue base for 2014, and the Brothers brand has been operating at a loss since its launch.

Justice’s clothes “too fashionable”

The New Jersey-based retailer acquired Justice (formerly Limited Too) in 2009, which never turned a profit since its 2012 launch.

Additionally, in a conference with analysts, the group’s CEO revealed that total Justice inventory will be down by 20 percent in the spring.

Jaffe said that customer have said in surveys that Justice's clothes were deemed "too fashionable" and considered only for special occasions – not everyday use. That has the chain changing the makeup of what it's going to sell from a merchandise mix of 40 percent high fashion, 40 percent everyday fashion and 20 percent basics to a 20-50-30 percent spread, reported the ‘Columbus Business Journal’.

The chain also is cutting back on promotions this year by as much as 40 percent.

Ascena Retail
Brothers
Justice