Fashion Retailer Part of a Pattern of Retail Bankruptcies
Buckle Inc, an American fashion retailer known for its jeans line, has announced another month of dipping sales. The company—which sells women’s, men’s, and kids’ clothing, shoes, and accessories—has announced that its comparable store sales fell in the four-week period ending August 26 by 7.9%, compared to the same period a year ago. Net sales, likewise, saw a year-over-year drop of 7.9% for that same period.
Meanwhile, the year-to-date net sales numbers are turning out to be even more disappointing. In the 30-week period ending August 26, Buckle Inc has seen its comparable store net sales slumping by 10% year-over-year.
The Nebraska-based retailer shared the August sales data just days after it reported its second-quarter earnings. Buckle Inc has also seen a significant year-over-year drop in its net income, which fell by a bit more than 25% in the second quarter of 2017, compared to the same quarter in 2016.
With these disappointing sales numbers, Buckle Inc joins the growing list of American retailers that are struggling to stay steady in this roller coaster ride that seems to be heading off the rails.
Meanwhile, the company has been closing underperforming stores and laying off workers. Seven stores have been closed by the retailer since August 2016. That brings down the number of Buckle stores from 470 to 463.
The year 2017 has become the year of retail bankruptcies. An increasing number of retailers are going bankrupt and, perhaps shockingly, most of them are fashion or specialty apparel retailers.
The trend glaringly coincides with Americans’ consumption patterns. Average American consumers are spending less on clothing and footwear, and instead are diverting their disposable income to other discretionary expenditures like travelling and entertainment.
The trend is weighing down heavily on the American apparel retail industry, which is already significantly saturated.
Meanwhile, e-commerce is continuing to snatch consumers away from traditional retailers. Online shopping is making it easy for Americans to simply make their purchases online instead of walking into physical stores. The growing dominance of digital retail is making it economically less viable for brick-and-mortar retailers to lease and operate large store spaces.
Buckle’s business woes stem from the same trends, and are now beginning to make survival exceedingly challenging for the company.
“The Buckle, Inc. Reports August 2017 Net Sales,” Buckle Inc, August 31, 2017.
“The Buckle, Inc. Reports Second Quarter Net Income,” Buckle Inc, August 17, 2017.