Ann Taylor Case
Introduction/Case Issues
Ann Taylor is being affected by external and internal factors that are making the company fight for survival in the specialty retail industry.
Ann Taylor is being affected by the declining economy, which is generating a wave of retail closures. The company is being threatened by slowing consumer demand due to the worsened macroeconomic conditions. Shoppers are now more careful when spending their money and as a result Ann Taylor lost $333.9 million in 2008 and the uncertainty continued for 2009. This loss also affects the company in the stock market because it makes it reluctant to give any profit forecast for the coming quarters and therefore causes lack of confidence from investors. The economic situation also limits the company to develop its new projects. Ann Taylor wanted to create a new chain of stores to target the 50+ segment because this particular segment has been the most significantly underserved in the market, but a result of the overall economic condition this new concept offering had to be delayed.
As an attempt to revitalize the flagship AT brand, Kay Krill, the CEO of Ann Taylor, has a very aggressive agenda consisting of opening a beauty business and an upscale expensive product in some of the top-selling Ann Taylor location around the world, among other projects. This is considered an issue because her agenda is too aggressive as the economy worsens. This agenda makes business very risky, which is one of the reasons why the company had to close its shoe store, reduced accessory inventory that the stores carried and eliminated the makeup line.
Another issue is that according to Talbot’s CEO Trudy Sullivan nobody is clearly winning in the 35+ consumer space right now and according to The National Retail Federation one of the retail niches that is showing the greatest growth is the ones aimed at women over 35. This means that Ann Taylor does not have a competitive advantage on this segment and therefore is
Ann Taylor is being affected by external and internal factors that are making the company fight for survival in the specialty retail industry.
Ann Taylor is being affected by the declining economy, which is generating a wave of retail closures. The company is being threatened by slowing consumer demand due to the worsened macroeconomic conditions. Shoppers are now more careful when spending their money and as a result Ann Taylor lost $333.9 million in 2008 and the uncertainty continued for 2009. This loss also affects the company in the stock market because it makes it reluctant to give any profit forecast for the coming quarters and therefore causes lack of confidence from investors. The economic situation also limits the company to develop its new projects. Ann Taylor wanted to create a new chain of stores to target the 50+ segment because this particular segment has been the most significantly underserved in the market, but a result of the overall economic condition this new concept offering had to be delayed.
As an attempt to revitalize the flagship AT brand, Kay Krill, the CEO of Ann Taylor, has a very aggressive agenda consisting of opening a beauty business and an upscale expensive product in some of the top-selling Ann Taylor location around the world, among other projects. This is considered an issue because her agenda is too aggressive as the economy worsens. This agenda makes business very risky, which is one of the reasons why the company had to close its shoe store, reduced accessory inventory that the stores carried and eliminated the makeup line.
Another issue is that according to Talbot’s CEO Trudy Sullivan nobody is clearly winning in the 35+ consumer space right now and according to The National Retail Federation one of the retail niches that is showing the greatest growth is the ones aimed at women over 35. This means that Ann Taylor does not have a competitive advantage on this segment and therefore is