Pier 1 proprietor is shopping for bankrupt Stein Mart for $ 6 million to reboot the model on-line subsequent yr
The company that gave Pier 1 Imports, Dressbarn and Modells sporting goods a second chance in online life is expanding its empire with another competitive retailer: Stein Mart.
Miami-based Retail Ecommerce Ventures is the winner of a bankruptcy auction for Stein Mart’s intellectual property, the company announced on Wednesday. The $ 6.02 million will be paid for the Stein Mart nameplate, as well as trademarks, domain names, social media assets, and other customer data.
Stein Mart, of Jacksonville, Florida, filed for Chapter 11 bankruptcy protection in August, but eventually closed all 281 stores.
REV, founded last year by Chief Executive Alex Mehr and Executive Chairman Tai Lopez, plans to get the budget apparel and homewares store that rivaled Ross Stores, Home Goods, Marshalls and Burlington Stores back on track as an online business bring. do not store until the beginning of next year.
The off-price sector in the US benefits from shoppers enjoying the thrill of browsing piles of goods for bargains. But the Covid pandemic dealt a blow to these retailers, including Stein Mart, which was already struggling with a debt overhang. Then sales dried up during the spring’s temporary store closings.
REV anticipates budget retailers will rebound strongly after a Covid-19 vaccine becomes widespread. And Wall Street seems to share that sentiment as stocks of non-priced retailers rise. TJX Companies stocks are up 27% from the previous month, while Ross stocks are up 30%. Burlington stocks are up nearly 14% over the past month.
“Whenever you see big, 800-pound gorilla competitors like TJ Maxx, you know they’re doing something right,” said Lopez of REV. “We want to be kind of an online version.”
However, off-price retailers have been slow to move online. Marshalls, owned by TJX, launched a website just last year. And last month, TJX announced it would add an e-commerce website for furniture chain HomeGoods in 2021.
REV hopes to fit into this growing digital landscape by developing a loyal base of Stein Mart customers in the southeast, Texas, Arizona and California, where most of the company’s operations are located, Lopez said.
“It’s cross-generational,” he said. “Stein Mart is definitely known.”
The advantage of REV is the e-commerce experience. It built a portfolio of fallen retail brands and breathed new life into them on the internet.
There were many brands to choose from as the Covid pandemic has driven many retailers who have already struggled with bankruptcy into bankruptcy. REV acquired the e-commerce business of Pier 1 Imports and the branded assets of Modells Sporting Goods. It also owns Dressbarn, Linens’ n Things, collectibles retailer Franklin Mint and UK-based bookseller The Book People.
In November, the company acquired the rights to the RadioShack brand in the United States, Canada, India, Australia, Europe, and China and related websites for an undisclosed price.
REV said its brands now generate more than $ 1 billion in sales every year.
“I’ve always been a huge fan of Warren Buffett and his strategy of only getting things that you already have instead of building from scratch,” said Lopez. “And in 2019 we saw the writing on the wall with the so-called retail apocalypse.”
Nor is REV the only one bidding on distressed retailers. But for the moment it remains with online deals.
“We didn’t go too far to find the bricks and mortar,” Lopez said. “There’s a lot to do online. Check out Amazon.”
In this way, it differs from apparel licensing firm Authentic Brands Group, which this year partnered with largest U.S. mall owner Simon Property Group to buy Lucky Brand and Brooks Brothers out of bankruptcy. ABG also owns brands like Juicy Couture and licenses them for sale in other retail stores.
Lopez said he’s looking for other deals and hopes there will be acquisition opportunities after the vacation.
“Retailers are going to look at their vacation numbers and they have all of those leases due,” he said. “No doubt there will be blood again on the streets.”