Top 50 Sponsors

TOP 50 SPONSORS Fifty top-performing apparel firms are working feverishly to innovate with product, win the hearts of the consumer, balance their footprint, and bring home the profits. Read on for a curated examination of what’s happening inside the walls of the prestigious 2016 Apparel Top 50.

#1 Michael Kors The global lifestyle brand makes its debut on the Top 50 this year, after issuing an IPO in 2012. (The company files under leather and leather goods, which Apparel did not previously consider. Had it done so, MK would have debuted at No. 6 in 2013, hit the No. 1 spot in 2014 and held steady there through this year. Also, at press time, MK had filed for its most recent fiscal year, and while its earnings and profitability are down, it still churned out a whopping 17.78 profitability). The brand, which produces a range of products under Michael Kors Collection, MICHAEL Michael Kors and Michael Kors Mens, including accessories, footwear, watches, jewelry, ready-to-wear and a full line of fragrance products, operates stores either directly or through licensing partners, in 95 countries around the world, and also has a large wholesale business. MK has expanded so rapidly in the past few years that many have judged it overexposed. Whether true or not, that rapid growth combined with decreases in mall traffic, heavy promotional activity and other chal- lenges at retail have recently spurred the company to cut back on the number of products it sells to wholesalers, as well as to retailers that sell many other brands, so as to better control its pricing, protect the Michael Kors brand image — and increase demand for full-price product. This year the company continues to expand its international markets and e-commerce flagships and is building up its men’s business. Also, in the spring it launched Michael Kors ACCESS, a line of wearable technology. In May, the company acquired Michael Kors (HK) Limited, the exclusive licensee of MK in China and other parts of Asia. cover sTory

#2 Gildan It nabbed the No. 1 spot for the second year in a row, just one more demonstration of how powerful it can be to have the “voice” of five-time CMA Male Vocalist of the Year Blake Shelton on your team. Then again, maybe it’s a sign of just how powerful it can be to own your manufacturing base, which Gildan continued to strengthen with $230 million in capital expenditures, including significant investments in yarn-spinning in 2015 that are reducing costs while also enhancing the company’s product offering with higher-end yarns. Nah. It’s probably Blake, who signed on as a celebrity endorser in early 2015. To date, Gildan, whose family of brands includes Gildan®, Gold Toe®, Anvil®, Comfort Colors®, Secret®, Silks®, Powersox®, Kushyfoot® and Therapy Plus™ as well as licenses for Under Armour® and Mossy Oak®, has sold 7 billion shirts in more than 50 countries and operates more than 25 facilities in North America, Central America, the Caribbean and Bangladesh that employ more than 42,000 employees. (In March 2015, Gildan received a $3.5 million special grant from the Honduran government in recognition of its significant job creation there, which it redistributed to educational, healthcare and housing projects in that country.) It continues to invest in vertical manufacturing and complementary acquisitions, in 2015 purchasing Comfort Colors, and just this past May acquiring Alstyle Apparel LLC, manufacturer of activewear products, which comes with its own manufacturing operations in Mexico. Gildan is gaining market share across segments: U.S. Printwear is up 12 percent, Branded Apparel sales grew 11 percent; and the Gildan® brand gained 14 percent market share in men’s socks, to reach the No. 2 brand position in the United States retail market.

#3 The Buckle Since it debuted on the Top 50 at No. 2 in 2009, The Buckle has remained at the top of the chart with a steady winning formula that puts the customer first. Sales, net income and profitability were all slightly down in 2015 but the company still turned in an impressive performance, with profitability of 13.16 percent. Online sales were up 11.8 percent, to $105.5 million. Men’s sales were up approximately 2 percent; women’s sales were down approximately 6.5 percent; and the company’s private-label business took a slightly larger share at 36 percent of sales. The popular denim destination opened nine new stores, completed 44 remodels and closed one store during the year, closing 2015 with 385 of its 468 stores in its newest format. This year it expects to open four new stores and complete 18 remodels.

#4 lululemon athletica Despite its now infamous see-through yoga pants and its founder’s comments about women’s thighs, lulu has nonetheless remained very profitable, and that is likely because it’s striking at the hearts of its ideal customers — a “32-year-old professional single woman named Ocean who makes $100,000 a year” and her counterpart, Duke, a 35-year-old athletic opportunist who enjoys surfing in the summer and snowboarding in the winter (and also makes more money than Ocean) — focusing on the “experience” part of the retail experience, expanding its community concept with Hub 17, a unique 5,000-square- foot space above its Flatiron store in NYC for fitness classes, monthly dinners, concerts, art shows and more. Also available: a concierge service to help with anything from sending packages home by messenger (free of charge), making dinner reservations, or booking a spot at an exercise class. Great Q4 top-line momentum exceeded expectations (global comps were up 11 percent and ecomm was up 33 percent), while lulu launched “Engineered Sensation” with new tech fabrics and construction techniques, also reorganiz- ing its “pant wall” to sell its yoga pants by fit or “sensation” instead of silhouette, which contributed to a 19 percent increase in women’s bottoms from September to January. Lulu is turning up the heat on digital with new CRM capabilities and marketing, opened new locations in London, Seoul and Tokyo, and expects to open 11 stores this year. International is expected to account for 20 percent to 25 percent of business by 2020, by when it expects total revenue to double to roughly $4 billion. Men’s business continues to outpace overall growth, and lulu hired Lee Holman to its first ever creative director position, with a goal of bringing men’s and women’s together under a unified brand vision.

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#5 Nike In an era when big established companies often find that their processes are cumbersome and that their businesses are outpaced in innovation by younger, more flexible startups, Nike has proven that big and nimble are not mutually exclusive. From its powerful marketing spots such as last year’s clever “We’re short a guy,” (watch it) to its Sport Research Lab which continues to develop product to enhance athletic performance, to its new NIKE+ app that combines on demand coaching, a personal store, and engaging experiences, Nike is just doing it. One other thing it just did (perhaps feeling the pressure from Under Armour’s rising roster of star athletes) was sign LeBron James to a lifetime deal — the largest single- athlete guarantee in company history. Nike has made more versions of James’ shoe than it has for any other athlete except Michael Jordan, who is on his 30th Air Jordan. Since signing James in 2003, Nike has made 13 versions of James’ signature shoe, with annual sales in 2015 for his line estimated to top $400 million. A few of Nike’s many new concepts and innovations include 1) the AntiClog Trac- tion football cleat, which keeps mud from sticking to the shoe; 2) the Free RN Motion for runners with a new outsole design that expands in multiple directions when the foot strikes the ground; and 3) the NIKE HyperAdapt 1.0, featuring auto adaptive lacing, with laces that tighten when your heel hits a sensor in the shoe. In the nine months since its annual filing, Nike has outperformed last year’s pace, with revenues up 5.7 percent, net income up 21 percent, and profitability at an impressive 12.1 percent.

#6 L Brands There’s a good chance that men everywhere will no longer bother to check the mail. It’s the end of an era for the company’s flagship brand: Victoria’s Secret announced that it is scrapping its famous catalog, which the company says is an outdated concept — and one that cost $125 million to $150 million annually. Other recent big changes at the company include job cuts, the elimination of swimwear, shoes and accessories, and the division of the VS business into Victoria’s Secret Lingerie, PINK and Victoria’s Secret Beauty, each of which will be managed by separate executives. (Former Spanx CEO Jan Singer will take over VS Lingerie and former Coach executive Greg Unis will run the VS Beauty business.) L Brands, whose portfolio also includes Bath & Body Works, La Senza, PINK and Henri Bendel, will grow this year via: real estate (27 new openings in North America, including a new Victoria’s Secret flagship store on Fifth Avenue); increasing store selling payroll in efforts to improve the customer experience; and investments in international expansion, which grew by 144 new stores in 2015 to reach 531, and will add about 175 stores this year globally.

#7 vF corp. You can’t help but be inspired by the stories of The North Face’s Never Stop Exploring® campaign, the company’s first expansive view of exploration and its first truly global brand effort. Check out the spots — you’ll be joining a large group. The campaign has received more than 1 billion impressions. VF’s more than 30 diverse brands include the iconic Vans®, The North Face®, Timberland, Lee and Wrangler — each of which exceeded $1 billion in annual revenue. Just a few other highlights from the year: 1) The Vans® and The North Face® brands came together in 2015 to launch a joint collection of popular limited-edition shoes and outerwear; 2) Chief Executive magazine named VF to the top 10 in its 2016 Best Companies for Leaders list; 3) VF saw great performance in running and training apparel driven by Mountain Athletics, which grew more than 40 percent; 4) 36 percent of sales came from outside the United States; 5) VF sourced or produced more than 550 million units of apparel and footwear, 23 percent at its own locations and 77 percent with contract suppliers, along the way establishing VF’s Responsible Sourcing program; 6) The North Face received great response to the launch of a new store concept on London’s Regent Street, which allows athletes to train together in weekly sessions; and 7) Vans’ PROPELLER skateboarding film was one of iTunes top 10 documentaries of the year and was named TransWorld SKATEboarding’s film of the year.

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#8 cintas #9 Duluth Holdings It turned in a solid performance in fiscal 2015 and for the most Duluth Trading is the home of Buck Naked Nation — One recent nine months ending in February, sales are up 9 percent Nation, Underwear, Indetectable, with Liberty and Comfort and net income up 72.9 percent with profitability at an impres- for All. (Hey, don’t look at me, that’s the motto of the na- sive 15.5 percent over the same period last year. In January, tion.) And while Buck Naked has clearly taken the nation by Cintas launched the first national brand campaign in its 87-year storm with its comfortable undies (12,000 five-star reviews history, “Ready for the Workday,” which includes TV, radio, and counting), you can find a lot of other things at the print and online and aims to show the breadth of products and casual and work apparel brand, from its bestselling ballroom services the company provides to a variety of businesses, from jeans to its no b.s. business wear. It was a whirlwind year for mom-and-pops to national chains. Already, the campaign has Duluth, which makes its debut on the Top 50 this year after resulted in greater brand awareness and assisted in cross-selling going public last October. In 2015, the Belleville, Wisconsin- efforts. Recent growth has been driven largely by new business based company took its fun and quirky marketing to a larger wins, sales of additional products and services to existing cus- audience via TV advertising focusing on core problem- tomers and strong customer retention, yet organic growth has solving products such as its Fire Hose pants, Flannel Shirts, continued to be hampered by decreased headcount in the oil, Longtail T and Buck Naked underwear. (Indeed, Duluth was gas and coal industries. The company’s conversion to SAP con- named an Apparel Innovator in 2012 for creating products tinues as it works to move its largest operating division, Uniform that address specific needs — the Long-Tail Tee, for example, Rental and Facility Services to the platform, a capital investment is the antidote to plumber’s butt.) It also drew new custom- of approximately $100 million; it plans to extend that SAP foot- ers to its base via carefully executed promotional activities print into its distribution network and expand its e-commerce in Q4, for example, offering sequence discounting to 30 capabilities, which it anticipates will cost $40 million. percent but avoiding the deep discounting prevalent among other retailers. Because of the evergreen nature of its core products — 70 percent to 75 percent of its products extend to the next season — the company can keep high inventory levels. In 2015, the company opened two new retail stores and one outlet, bringing its total store count to nine, this year expects to open four to five more, and in 2017 another eight, moving closer to the East Coast, where it has its largest concentration of customers. It is expanding its Belleville DC this year to accommodate sales expansion and new store openings and to lower labor intensive 3PL costs. It is also leasing another facility located nearby, and implementing a new order management system.

#10 Francesca’s collections #11 ross stores In line with its Vision 2020 long-term strategic plan, it improved inventory man- The owner of Ross Stores and dd Dis- agement, clearing out slow moving inventory and improving the flow cadence to counts turned in a strong year, despite a boutiques, with new merchandise arriving almost daily; enhanced merchandise highly promotional selling environment assortments; and elevated the boutique experi- in Q4 and its most challenging sales ence — efforts that took hold in the second comparisons from the prior year, driven half of the year with a return to positive comps. by competitive prices on a wide assort- Its apparel business grew significantly, led by ment of items. Operating margin for the dresses, which doubled in sales over last year. A year increased to a record 13.6 percent, few other highlights: 1) Francesca’s DTC channel and the company ended the year with grew 18 percent over the previous year to $17.1 inventories up 3 percent, with packaway million; 2) it reduced its promotional cadence, levels at 47 percent of total inventories, which affected comps but which it expects to be compared with 45 percent last year. The beneficial in the long term; 3) it opened 83 new company plans to add about 70 Ross stores and closed six, bringing its boutique count and 20 dd’s Discounts locations in 2016. to 616; and 4) it put a new executive team in Matching Walmart’s moves, Ross raised place, with a new CFO, chief merchant, SVP of the minimum wage to $10 per hour in marketing and DTC, VP of IT, VP of real estate, the second quarter of this year in efforts VP and DMM for product. to attract and retain talent.

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#12 UniFirst #13 carter’s It was another record year for the company, which hit highs of $1.5 It turned in record sales and earnings in 2015 and its billion in revenues and $124.3 million in net income, led by its core 27th consecutive year of sales growth, opened more laundry operations, which make up 90 percent of total business and than 100 new stores in North America and began in 2015 achieved record new account sales, continued improvement e-commerce capabilities in China via the launch of its in operational and service efficiencies in its hundreds of local service Carter’s brand on Alibaba’s Tmall, which received more facilities and positive trends in customer pricing and add-on services. than 12 million visits last year. Young children’s is the These gains were achieved de- fastest-growing apparel segment in China, estimated spite losses of wearers associat- at $12 billion and projected to more than double to $25 ed with lower oil prices in ener- billion by 2025. In the United States, the segment grew gy and energy related industries, about 2 percent last year to $20.5 billion, with Carter’s which reverberated throughout piece of the pie growing to 17 percent. the uniform market, as well The company continues to improve its mobile experi- as a weaker Canadian dollar ence, with demand on mobile devices more than exchange rate that negatively doubling in 2015. In Q4, the company launched a new affected both top and bottom customer loyalty program, called Rewarding Moments, lines; both are factors that will which enrolled more than five million shoppers in just continue to affect the company the first four months. In the next five years the compa- in 2016, as will rising labor costs, ny expects to open 270 Carter’s stores, most in its new and continuing investments in side-by-side format, which brings together the Carter’s IT, including its ongoing CRM and OshKosh B’gosh brands in one location, a model project. In 2015, the company that has kicked up the performance of its OshKosh made several small acquisitions, brand. E-commerce sales were up 20 percent in 2015; primarily in its laundry opera- even as international demand fell seven percent, due tions, and continues to look for to the strong dollar, domestic sales were up 40 percent. acquisition targets.

#14 columbia sportswear Record sales of $2.3 billion included 7 percent growth from the Columbia brand, 26 percent growth from SOREL and 29 percent growth from prAna ( in its first full year as a member of the company’s portfolio); 21 percent growth in the United States, balanced across wholesale and direct-to-consumer, including a 30 percent increase in e-comm sales; and 20 percent growth in its Europe-direct markets. In 2015: 1) Columbia Sportswear introduced OutDry Extreme™ rainwear, which it reports is the first in the industry with a mem- brane-on-the-outside construction; 2) it launched its most global marketing campaign ever (and largest investment for the year), Tested Tough™, featuring the company’s 92-year-old chairman (and founder) Gert Boyle reprising her role as the Original Tough Mother; 3) it continued to enhance the brand through licensing arrangements such as with Manchester United and the Dal- las Cowboys, and via partnerships such as urban-style influencer KITH, with which it created an updated version of its 1986 Bugaboo parka.

#15 Hanesbrands The owner of such iconic brands as Hanes, Champion, Playtex, Bali, Maidenform and Wonderbra turned in a record year, with revenue up 8 percent — driven by acquisitions — even though Q4 was negatively impacted by widespread retail traffic declines. With the integration of Knights Apparel and Hanes Europe well underway, the company was looking to make additional acquisitions, and an all-cash deal for Champion Europe, based in Italy, (which also owns the brands rights in the Middle East and Africa), was expected to close in late June. The acquisition of Australia’s top underwear and intimate apparel company, Pacific Brands Ltd., for $800 million in cash — Hanesbrands largest ever deal — was expected to close later this month. Hanesbrands projects that it will hit $2 billion in global Champion sales by 2021 or 2022. The company continues to pursue its Innovate-to-Elevate strategy by expanding the space of innovation platforms such as X-Temp and working to apply that innovation to core products, such as in Tagless; and to focus on growth online, which represents 18 percent of apparel sales.

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#16 TJX companies #17 PvH The off-price model continues to shine, and in 2015 the In a big marketing win, PVH signed tennis great Rafael Nadal as company crossed the $30 billion threshold, with comp- the brand ambassador for Tommy Hilfiger Underwear, Tommy store sales up (for the 20th consecutive year) 5 percent Hilfiger Tailored, and the Tommy Hilfiger Bold fragrance, which was on higher customer traffic across the company’s four accompanied by a global multimedia advertising campaign in more divisions: MarMaxx, Home Goods, TJX Canada and TJX than 40 countries, campaign video that went viral and was one of International, the latter expanding in Europe and entering the top 10 videos on Google for the launch period. The campaign Australia with the acquisition of off-price retailer Trade had more than 500 million impressions during the second half of Secret. The company added 219 stores, including ad- 2015 and helped full-price sales of underwear nearly double in ditional Sierra Trading Post stores, and closed just one, Europe and in the United States during the second half as well. In ending the year with 3,614 stores, and 216,000 employ- February, Tommy Hilfiger Licensing LLC and G-III Apparel Group ees — 1,000 of which comprise its buying organization, (No. 27) entered into a multi-year license agreement for the design, with another 1,000 devoted to merchandising, including production and distribution of Tommy Hilfiger women’s wear col- planning and allocation. Calling itself a “global sourc- lections in the United States and Canada, which includes PVH’s ing machine, ” TJX has buyers in 11 countries across four current women’s sportswear business and additional categories to continents, buying from 18,000 vendors in 100 countries be licensed, including suit separates, performance and denim — — a vast reach that gives it flexibility to move quickly to and it also signed supermodel and millennial icon Gigi Hadid as capitalize on the best merchandise opportunities. Its sup- the global brand ambassador for the collection. PVH announced ply chain and distribution network is designed to process that it will acquire the remaining 55 percent stake in its Tommy Hil- buys both small and large, and move them quickly to the figer China joint venture, which more than doubled from approxi- right locations. Expect more growth from this crowd fave, mately $70 million to just over $140 million in revenues in 2015. Its across its current locations, via the addition of stores, via Calvin Klein business turned in a strong performance, including a e-commerce, in its loyalty program, and across all age U.S. jeans turnaround, which saw soft sales at department stores brackets and demographics. but strong performance through its new U.S. retail partners including Urban Outfitters (No. 19) and Amazon.

#18 The cato corp. In another challenging year, Charlotte, NC-based Cato produced its highest earnings in company history. The Cato and Versona e-commerce business continues to grow and the company is driving revenue not only from its website, but also by using its order-from and ship-to store models to drive additional volume to its stores. Plans to invest $27 million in capital expenditures in 2016 include the opening of 23 new stores and continued investment to enhance and upgrade its existing systems. At the end of 2015 the company operated 1,092 Cato stores, 214 It’s Fashion and It’s Fashion Metro stores, and 66 Versona stores, each concept targeting a different customer base, but all focusing on providing fashion and accessories at exceptional values.

#19 Urban outfitters Since the shift 10 years ago to the skinny bottom, women have filled their closets with leggings and jeggings and lots of long tops and sweaters to go over them, which might be why the apparel category at the company, primarily at Anthropologie and Free People, has slumped, even as other categories have thrived. But UO sniffs fashion excitement in the air, and is hopeful it can turn things around soon in that category. The company is approaching what it believes is its maximum store unit potential in North America, and several of the approximately 26 new stores it plans to open this year will be in Europe. While the company sells and ships to more than 130 countries via the web, it will be looking to expand distribution on the ground globally via a variety of models ranging from self-owned and -operated stores to concessions and wholesale arrangements to licensing. An expanded format for Anthropologie will enable it to serve consum- The Cato Corp. The Cato ers with broader assortments, especially in categories it has targeted for expansion across the company, including home, beauty, shoes, and intimates as well as the BHLDN wedding brand and the Terrain outdoor living brand. (Its new beauty assortment offered online and in 70 concept shop-within-shops in Anthropologie was so successful that it plans to open an additional 60 shops this year.) And, because you can’t eat wedding dresses or shoes, the company also plans to open two to three Vetri Pizzerias, which will be standalone locations. On the omnichannel front, efforts to improve functionality around check out, payments, search, inventory visibility and speed on all of its brands’ web platforms will include the roll out of in-store-pick-up, ship-through-store, and enhanced mobile application capabilities.

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#20 G&K services #21 superior Uniform Group It made progress toward the 12+ Plan it introduced In March, the company acquired Los Angeles, Calif.-based Bamko — a two years ago, targeting 12 percent operating margin full-service merchandise sourcing and promotional products company (it hit 11.9 percent) and 12 percent ROIC (it reached with a global reach — for approximately $15.8 million, which includes 11 percent), with an additional focus on top-line the company’s subsidiaries in Hong Kong, China, Brazil and England growth. Revenue grew to $937 million, with organic as well as an affiliate in India. Superior views the acquisition as an op- revenue growth of 5.6 percent, topping the previ- portunity to strengthen its position in retail, health care, food service, ous year’s 4.5 percent. The year saw record customer transportation and other markets that it serves. Two years after its satisfaction scores and record new accounts sales, and entrée into direct via its Fashion Seal Healthcare Direct division, it con- in 2016, the company’s Game Plan to: 1) keep its cus- tinues to work to drive higher sales and profitability from this channel, tomer promise; 2) improve how it targets customers; and is also gaining traction with additional integrated delivery networks 3) drive operational excellence and 4) strengthen its (IDNs) and additional GPO contracts. In January, the company opened high-performing team is producing results, as, three its first company-managed manufacturing facility in almost 20 years quarters into the current fiscal year, G&K is on pace after entering a long-term agreement to lease a factory built to spec in to turn in the highest full-year operating cash flow Haiti, just on the country’s border with the Dominican Republic. This in company history, even as it struggles, along with will provide multiple advantages, not least of which are the duty-free the rest of its competitors, with a net loss of uniform benefits of producing there, and access to the country’s highly trainable wearers at existing accounts, particularly in the oil and and eager workforce, which is expected to number approximately 150 gas industries, as well as in related manufacturing. on site by year’s end.

#22 American eagle outfitters It wasn’t long ago that the moniker “teen retailer” pretty much guaranteed your business was in the dumps, but though Aeropostale declared bankruptcy and Abercrombie is taking more time to regain its stride, American Eagle is soaring (pun intended). The company has really made a turnaround in the past couple of years with better quality, innovation in product, and clever marketing that strikes a chord with consum- ers. It was a banner year for the company, which saw higher selling prices and higher margins, bigger baskets and traffic increases both online and in-store. Comp-store sales were up 7 percent and direct was up 20 percent, totaling more than $110 million in sales growth, aided by omni tools such as ship-from-store (accounting for 20 percent of digital in Q4). Both women’s and men’s collections were strong performers, while the Aerie brand really took off last year, in no small part to its funny and inclusive Aerie Real ad campaigns that continued to resonate across social media with their focus on #bodyacceptance — models are not airbrushed or retouched in any way. Media impressions on the campaign rose to 4 billion in 2015! The company took its campaign one step further on April 1 — in what may or may not be a bit of an April Fools’ joke. In a spot that took its #bodyacceptance campaign to the other gender, the #AerieMan shares “real-life” stories while comfortably lounging in his skivvies. Also in 2015, AEO acquired Tailgate Clothing Co., a vintage, sports-inspired apparel brand with a college town store concept, and Todd Snyder New York, a premium men’s wear brand, for $11 million. It also acquired the brand founder and creative director, Todd Snyder, who joined the company as EVP.

#23 Under Armour If you judge an athletic brand by the successes of the athletes who wear its product, then Under Armour might snag the No. 1 spot. Call it “The Year of Champions.” UA does. In 2015, the MVPs of the big four U.S. professional leagues were UA brand ambassadors: Cam Newton (NFL), Stephen Curry (NBA), Bryce Harper (MLB), and Carey Price (NHL). And then there’s Jordan Spieth, PGA Tour Player of the Year, who regained his No. 1 World Golf ranking. Also: Misty Copeland, who performed as the first African American principal dancer at the American Ballet Theatre. Lindsey Vonn, who became the most decorated female alpine skier of all time. Not too shabby. And the list goes on. It was its 10th year as a public company, highlighted by 30 percent top-line growth and 23 consecutive quarters of 20 percent growth in revenues — one of just two companies in the S&P500 that can make that claim. Apparel, its largest category, grew 22 percent. Direct-to-consumer expanded to 25 global websites and nearly 200 Under Armour-owned retail doors around the world, and represents 30 percent of business. In 2015, UA opened its largest store ever on the Magnificent Mile in Chicago and its first flagship in China, in Shanghai. Speaking of, international business grew 69 percent to 11 percent of revenues, up from 6 percent two years prior. Footwear was up 57 percent — driven in large part by the amazing performance of Stephen Curry — and UA has its eyes set on the $1 billion mark for this category. Connected Fitness (including UA Record, MapMyFitness, Endomondo and MyFitnessPal) has taken on a life of its own, with 160 million registered users who logged nearly 8 billion meals and 2 billion activities over the course of the year. An average of more than 100,000 users join the platform each day! It’s turning that data, via its MATH HOUSE, into a single view of the consumer that it expects to transform its business and the lives of athletes around the globe.

www.apparelmag.com • JULY 2016 19 A ranking of apparel companies (with at least $100M in annual sales) that are publicly THE TOP traded on the U.S. stock exchange by their profit margin for the most recent fiscal year. SALES NET INCOME %% % Profit Profit Last Most % Most Change Margin, Margin, 2016 Year’s 50 Recent Previous Change Recent Previous Net Most Previous RANK Rank Company FY FY FY Sales FY FY Income Recent FY FY 1 New Michael Kors March 4,371.5 3,310.8 32.0 881.0 661.5 33.2 20.15 19.98 2 1 Gildan Sept. 2,568.6 2,299.2 11.7 355.4 281.0 26.5 13.84 12.22 3 2 The Buckle Jan. 1,119.6 1,153.1 (2.9) 147.3 162.6 (9.4) 13.16 14.10 4 4 lululemon athletica Jan. 2,060.5 1,797.2 14.6 266.0 239.0 11.3 12.91 13.30 5 6 Nike May 30,601.0 27,799.0 10.1 3,273.0 2,693.0 21.5 10.70 9.69 6 8 L Brands (formerly Limited Brands) Jan. 12,154.0 11,454.0 6.1 1,253.0 1,042.0 20.2 10.31 9.10 7 10 VF Corp. Jan. 12,376.7 12,282.2 0.8 1,231.6 1,047.5 17.6 9.95 8.53 8 13 Cintas Corp. May 4,476.9 4,469.6 0.2 430.6 374.4 15.0 9.62 8.38 9 New Duluth Holdings (Duluth Trading Co.) Jan. 304.2 231.9 31.2 27.4 23.6 16.1 9.01 10.18 10 11 Francesca’s Collections Jan. 439.4 377.5 16.4 38.2 32.1 19.0 8.69 8.50 11 12 Ross Stores Jan. 11,940.0 11,041.7 8.1 1,020.7 924.7 10.4 8.55 8.37 12 9 UniFirst Aug. 1,456.6 1,394.9 4.4 124.3 119.9 3.7 8.53 8.60 13 19 Carter’s Jan. 3,013.9 2,893.9 4.1 237.8 194.7 22.1 7.89 6.73 14 20 Columbia Sportswear Dec. 2,326.2 2,100.6 10.7 174.3 137.2 27.0 7.49 6.53 15 16 Hanesbrands Jan. 5,731.5 5,324.7 7.6 428.9 404.5 6.0 7.48 7.60 16 15 TJX Companies Jan. 30,944.9 29,078.0 6.4 2,277.7 2,215.0 2.8 7.36 7.62 17 25 PVH Corp. Jan. 8,020.0 8,241.0 (2.7) 572.0 439.0 30.3 7.13 5.33 18 22 The Cato Corp. Jan. 1,011.1 986.9 2.5 66.8 60.5 10.4 6.61 6.13 19 17 Urban Outfitters Jan. 3,445.1 3,323.1 3.7 224.5 232.4 (3.4) 6.52 6.99 20 21 G&K Services June 937.6 900.9 4.1 59.9 56.1 6.8 6.39 6.23 21 23 Superior Uniform Group Dec. 210.3 196.2 7.2 13.1 11.4 15.4 6.23 5.78 22 36 American Eagle Outfitters Jan. 3,521.8 3,282.9 7.3 213.3 88.8 140.2 6.06 2.70 23 18 Under Armour Dec. 3,963.3 3,084.4 28.5 232.6 208.0 11.8 5.87 6.74 24 14 Gap Inc. Jan. 15,797.0 16,435.0 (3.9) 920.0 1,262.0 (27.1) 5.82 7.68 25 7 Polo Ralph Lauren Mar. 7,405.0 7,620.0 (2.8) 396.0 702.0 (43.6) 5.35 9.21 26 33 Express Jan. 2,350.1 2,165.5 8.5 116.5 68.3 70.6 4.96 3.15 27 27 G-III Apparel Group Jan. 2,344.1 2,116.9 10.7 114.3 109.0 4.9 4.88 5.15 28 39 Levi Strauss & Co. Nov. 4,494.5 4,754.0 (5.5) 209.4 106.1 97.4 4.66 2.23 29 24 Nordstrom Inc. Jan. 14,095.0 13,110.0 7.5 600.0 720.0 (16.7) 4.26 5.49 30 30 Guess? Inc. Jan. 2,204.3 2,417.7 (8.8) 81.9 94.6 (13.4) 3.72 3.91 31 26 Zumiez Jan. 804.2 811.6 (0.9) 28.8 43.2 (33.3) 3.58 5.32 32 32 The Children’s Place Jan. 1,725.8 1,761.3 (2.0) 57.9 56.9 1.8 3.35 3.23 33 29 Oxford Industries Jan. 969.3 920.3 5.3 30.6 45.8 (33.2) 3.16 4.98 34 31 Ever Glory Dec. 421.4 460.1 (8.4) 13.3 16.4 (18.9) 3.16 3.56 35 44 Citi Trends Jan. 683.8 670.8 1.9 15.5 9.0 72.2 2.27 1.34 36 47 Delta Apparel Inc. Oct. 449.1 452.9 (0.8) 8.1 (1.0) 910.0 1.80 (0.22) 37 40 Stein Mart Jan. 1,359.9 1,317.7 3.2 23.7 26.9 (11.9) 1.74 2.04 38 New Vince Jan. 302.5 304.4 (0.6) 5.1 35.7 (85.7) 1.69 11.73 39 3 Kate Spade (formerly Fifth and Pacific) Jan. 1,242.7 1,138.6 9.1 17.1 159.2 (89.3) 1.38 13.98 40 35 Tilly’s Jan. 551.0 518.3 6.3 7.5 14.1 (46.8) 1.36 2.72 41 43 Abercrombie & Fitch Co. Jan. 3,518.7 3,744.0 (6.0) 35.6 51.8 (31.3) 1.01 1.38 42 42 Stage Stores Inc. Jan. 1,604.4 1,638.6 (2.1) 3.8 30.9 (87.7) 0.24 1.89 43 38 Chico’s FAS Inc. Jan. 2,642.3 2,675.2 (1.2) 1.9 64.6 (97.1) 0.07 2.41 44 48 Gordman’s Jan. 649.0 634.6 2.3 (4.3) (3.5) (22.9) (0.66) (0.55) 45 Back Perry Ellis International Jan. 899.5 890.0 1.1 (7.3) (37.2) 80.4 (0.81) (4.18) 46 Back Gymboree Jan. 1,247.4 1,228.7 1.5 (10.2) (574.1) 98.2 (0.82) (46.72) 47 41 Destination Maternity Corp. Jan. 498.8 517.0 (3.5) (4.5) 10.5 (142.9) (0.90) 2.03 48 49 New York & Company Jan. 950.1 923.3 2.9 (10.1) (16.9) 40.2 (1.06) (1.83) 49 28 Lands’ End Jan. 1,419.8 1,555.4 (8.7) (19.5) 73.8 (126.4) (1.37) 4.74 50 50 Destination XL Jan. 442.2 414.0 6.8 (8.4) (12.3) 31.7 (1.90) (2.97)

*Notes: Back = The company has been ranked in the Apparel Top 50 in previous years but was not ranked last year because of its performance, because it was not publicly traded, etc. Dollar amounts are in millions of U.S. dollars. Levi Strauss & Co. is a privately held company that releases financial data publicly. The Exceptional CAD Solution Inspiring creativity, performance and quality.

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#24 Gap Inc. Gap has continued to struggle, and 2015 saw revenues and net income decline along with store traffic, which has persisted into Q1 2016, when poor performance hit all brands except Athleta, which has captured a healthy niche at the intersection of performance and lifestyle. Some of Gap’s problems are surely due to an oversaturated retail market in the United States, and it continues to shutter stores here, but a broader problem seems to lie with the product itself. Gap Inc. is working to get back on a growth track, trying to replicate its successful Old Navy business model — although even that brand saw a 6 percent decline in Q1 2016 — with a focus on product, as well as experience and talent. At Gap, it’s striving for a fresh take on the brand, including a return to its denim roots, while at Banana Republic it’s working on the contemporary classics the brand is known for — all while working to produce faster and closer to market. To wit: it experimented with a purchase-off-the-runway model with Banana Republic, offering a few limited-edition pieces immediately after fall 2016 showing at New York Fashion Week in February; it has moved toward a platform of making fabric buys over multiple seasons and in some cases leaving open-to-buy available in season so it can respond to what’s selling; and it is now using retail DCs to provide direct fulfillment capacity for its online business. It’s also bringing together web and mobile on a responsively designed platform, with a focus on thinking digital first and mobile first — the place where, these days, says CEO Arthur Peck, customer affection is typically won or lost.

#25 ralph Lauren Revenues were down 2.8 percent and net income was down 43.6 percent (!) and the company is taking a long hard look at the business to understand the drivers of its faltering performance and how to get back on track. In a nutshell, says CEO and president Stefan Larsson, the company has lost focus on the things that made it great in product, marketing and the shopping experience; its underlying business engines are not running at full speed; it has an inefficient cost structure and an organization that’s not nimble enough in the marketplace. Turning things around will require it to reclaim its classic iconic style, while at the same time bringing it into alignment with the aspirations and desires of today’s shopper, and part of that turnaround is expected to come from new talent at the company, including Valerie Hermann, brand president of Lauren, Polo Women’s, Chaps and Denim & Supply; Fredrik Hjalmers in the newly created position of SVP, global expansion and business development; and Holiday Alagos, as head of global sourcing. Also, last month, Larsson announced a restructuring plan that will include closing at least 50 stores and cutting 8 percent of the full-time workforce (about 1,000 employees), in order to create a leaner business that operates with fewer layers of management.

#26 express It relied less on key items and introduced more fashion pieces, while flowing new items through the collections more frequently. It also introduced more merchandise categories, including One Eleven (soft, casual knit tops) and the Edition capsule collection (elevated pieces for going out) for women, and introduced men’s soft shirts, among other launches. The results speak for themselves, with comps up 4 percent, e-commerce up 11 percent (growth that came without the high number of online only promotions used the previous year, part of an overall reduction in promotional activity) and profitability up to almost 5 percent from just more than 3 percent the previous year. It moved closer to its goal of 140 to 150 outlet stores with the addition of 40, ending the year with 81, and closed 27 retail stores as part of its plan to close 50 by 2017, upon lease expiration. It has shifted its international strategy to focus on the Americas, with plans to exit the Middle East and South African markets this year. On the marketing front, the company made a splash with high profile models and athletes such as Karlie Kloss and Stephen Curry, respectively, while on the back end the company moved from legacy systems to new order management, retail management and ERP systems and is moving its e-commerce fulfillment to new state-of-the-art facilities on its march toward becoming a truly omnichannel enterprise.

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#27 G-III Apparel Group This is a company with a wide-ranging portfolio, and it’s only getting bigger. As noted previously, G-III expanded its relationship with Tommy Hilfiger through a new license agreement for Tommy Hilfiger women’s wear in the United States and Canada (adding to its existing licenses for Tommy Hilfiger dresses, men’s and women’s outerwear and luggage). It also acquired a 49 percent inter- est in a joint venture that holds brand rights to the Karl Lagerfeld trademarks for consumer products (with certain exceptions) and apparel in the United States, Canada and Mexico, and is the first licensee of the joint venture, with a license for women’s apparel, women’s handbags, women’s shoes and outerwear. Although it grew sales at a double-digit pace, and experienced continued momentum in its non-outerwear categories, the year was challenging, in no small part because of the unseasonably warm weather of Q4 — a struggle for many retailers, but particularly for G-III, where outwear represents approximately 40 percent of the wholesale business. G-III has expanded and diversified in categories from dresses to handbags to sportswear and activewear, and its relationship with PVH and the Calvin Klein organization has been the foundation for those growth platforms in each category. In specialty retail, its G.H. Bass continues to offer great potential; even in a tough environment, full-year comps for Bass stores were up 12.1 percent, and the brand is moving forward with a variety of licensing initiatives to expand both in department stores domestically and through distribution in international markets.

#28 Levi strauss & co. It’s turned in three consecutive years of both top- and bottom-line growth for the first time in 20 years, achieving particular success with the Levi’s brand, including the new women’s denim collection and the 501 CT® jean; Docker’s, which celebrates its 30th anniversary this year, represented 10 percent of business, down from 11 percent; and The Denizen® and Sig- nature® brands represented 5 percent of business, up from the two prior years. It continued to focus on its direct-to-consumer business, adding 91 new stores during the year and enhancing the online shopping experience. Globally, Europe and Asia represented 39 percent of revenues, and growth in those regions help offset declines in the Americas, to the tune of 3 percent. This year kicked off with a strong start, visibility-wise, as Super Bowl was played at Levi’s® Stadium. That’s 110 million sets of eyeballs in the United States, plus hundreds of millions of viewers around the world. A worthwhile deal, says president and CEO Chip Bergh, given that the Levi’s Stadium partnership is roughly the same cost as two 30-second Super Bowl spots, and less than 5 percent of its advertising budget.

#29 Nordstrom It expects that by 2020, one third of its customer experiences will end with a package arriving on a doorstep, and that’s motivating all sorts of improvements, from the opening of a new fulfillment center in Elizabethtown, Pennsylvania to improving its mobile app with enhancement such as linking a customer’s Nor- dstrom Rewards account to their Nordstrom app and a “shop my store” feature that allows the customer to filter inventory specific to the store they’re shopping. Wise investments, as mobile now makes up one-third of online demand, up from less than 5 percent just five years ago! Overall online demand hit 20 percent of sales, up from 8 percent five years ago. A few other highlights from the year: 1) In fall 2015, the company expanded its Trunk Club into a Trunk Club for women; 2) it launched SPACE, a shop for emerging and advanced designers created and curated by Nordstrom VP of creative projects, Olivia Kim, in five stores as well as online; 3) it opened its first international flagship store, in Vancouver, which was the most successful opening in Nordstrom history, and it will follow that with a flagship opening in Toronto this year and another in Manhattan in 2019; and 4) Last year it launched Nordstromrack.com and combined it with Hautelook so customers can shop both sites at once. Those businesses grew 50 percent during the year, generating a half billion dollars in sales and exceeding expectations.

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#30 Guess? Inc. The company expects revenues to grow from $2.2 billion to $3 billion in three years — that growth fueled by e-commerce, new store openings and comp growth across all concepts — with $300 million coming from the Americas, with a particular focus on e-commerce, factory stores and G by GUESS, and a net increase of 60 stores in the region over the three-year period; approximately $300 million from Europe, including its new joint venture in Russia, with a net increase of 140 stores; and approximately $200 million from Asia, where it expects to generate more than two-thirds of sales growth from Greater China, and where it sees strong demand and traffic from its newly opened stores. It plans a net increase of 200 stores in Asia over the three-year period. It expects licensing revenues on its wholesale business to remain flat. In Q4, Guess completed the purchase of its U.S. DC in Kentucky for $28.8 million.

#31 Zumiez A challenging year for the company, which in addition to facing the same traffic and FX chal- lenges as all other retailers, had neither as strong a fashion cycle nor a “hot item” as it did in 2014, which contributed to the drop in revenues and income, and comps down 5.3 percent. Guess? Inc. But Zumiez is looking to its heavy investments in omnichannel over the past five years to help move the needle in the other direction going forward. Its omni investments include an enhanced assortment planning system for micro-sorting stores; an upgrade of its web platforms in both the United States and Europe; the roll out of its Stash loyalty program; the 2016 roll out of a new customer engagement suite that will better integrate all sales channels; and the launch of full localization, enabling nearly 100 percent in-store fulfillment of online orders. In new store openings, including 27 U.S. stores this year, it will put a big focus on optimizing the footprint of each in its respective geographic trade area, making sure not to have one more store than necessary. It has plans to open seven stores in Europe this year.

#32 The children’s Place #33 oxford Industries Its focus on operational excellence is evident: revenues were slightly down yet in- In April, the owner of Lilly Pulitzer, Tommy come and profitability were up, as it continues to focus on its four strategic pillars Bahama, and Lanier Apparel added to its of 1) superior products, 2) business transformation through technology, 3) growth portfolio with the acquisition of lifestyle through alternate channels of distribution and 4) fleet optimization. To wit: TCP apparel brand Southern Tide, for $85 million, has improved design talent, achieving more consistent product execution and deepening a relationship that goes back to more frequent fashion deliveries. It replaced every major system at the company 2009 when Oxford began providing sourcing since 2010, last year implementing a state-of-the-art inventory allocation and and production services to the brand. That replenishment tool; beginning implementation of a markdown optimization tool acquisition should add approximately $35 to go live in the second half of this year; and implementing a new distributed million to the till for the remainder of 2016. order management system to provide cross-channel fulfillment capabilities. It As for 2015, it was a good year of solid top- also enhanced digital, including with organic search and dynamic lifecycle e-mail and bottom-line growth, and it was an ex- campaigns, and launched e-receipts. TCP now has six international franchise ceptional year for Lilly Pulitzer, whose sales partners operating in 16 countries with 102 points of distribution and it expects grew 22 percent. This year the company will to add 40 this year. It is also preparing to enter e-commerce in China. As for fleet work to build on that momentum, increasing optimization, it is on pace to close 200 stores during the 2013 to 2017 period. investment in marketing to attract new customers through traditional advertising and of course through social media — where it already commands a leading position. Con- sider its current #SummerInLilly campaign, which allows customers to upload photos of themselves and their friends in Lilly — and then allows other customers to shop those looks directly from the photos. Talk about letting your customers do your work for you. It must be working. For 2015, Lilly Pulit- zer’s web business totaled an impressive 30 percent of sales!

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#34 ever Glory #35 citi Trends Sales and income were down for Ever Glory, a retailer of fashion wom- Earnings were up 72 percent, and profitability was en’s apparel under its own brands, “La go go,” “Velwin,” “Sea to Sky,” up, although full year comp sales were down 0.1 and “Idole,” which operates more than 1,100 retail locations in China. It percent at this value-priced retailer of urban fashion also manufactures for a number of well-known retail chains and domes- apparel, shoes, accessories and home décor. The tic and global brands, with a focus on middle-to-high-end casual wear, company implemented a new planning and alloca- outerwear and sportswear brands. Although it has its own manufactur- tion system, opened 13 new stores and success- ing capacity, Ever Glory outsources most manufacturing to its strategic fully tested e-commerce. It expects Home to be its long-term contractors as part of its overall business strategy. Outsourcing strongest growth driver this year, with its opportu- allows it to maximize its production capacity and remain flexible while nities for a greater merchandise assortment; it has reducing capital expenditures and the costs of keeping skilled workers added buyers to this division and plans to expand its on production lines during times of seasonally lower sales. Total unit presence in stores. It also sees a growth opportunity output from its manufacturing facilities and outsourced partners totaled in the expansion of shoes and accessories across all more than 19.5 million pieces in 2015. Approximately 54.3 percent of its genders and age categories. This year, it expects to sales for 2015 came from customers in China, 6.8 percent from Germany, open between 15 and 20 new stores, to relocate or 23.2 percent from the United Kingdom and other European countries, 9 expand 10 to 15, and to remodel about 20. percent from the United States, and 6.6 percent from customers in Japan.

#36 Delta Apparel The company made progress on several strategic initiatives designed to lower fixed salary cost, de-layer management to speed deci- sion making, improve its manufacturing platform, and exit markets that did not fit the long-term growth and profit goals of the company. Resulting cost savings and improvements in efficiency helped drive improved gross margins in the last half of fiscal year 2015. Delta also sold its collegiate license headwear business under “The Game” label. It made investments in screenprinting equipment to expand capacity, lower cost, and improve quality, and also decided to install open-width finishing equipment in its Ceiba Textile facility to greatly reduce or eliminate externally purchased fabric and provide broader fabric and apparel design flexibility going forward — investments that should save approximately $2 million dollars annually. Digital printing business Art Gun, a start-up just a few years ago, is now its fastest-growing operation, and the company purchased additional equipment during the year to meet demand.

#37 stein Mart Sales started strong in 2015 but then softened in the second half, as they did for many retailers, resulting in the company’s first quarterly comp sales decrease in more than three years. Some 2016 initiatives to drive sales include: expanding its ladies’ boutique assortment with better brands, career and its Peck & Peck private label; continuing to develop women’s special sizes; focusing on the athleisure trend by adding more performance and relaxed wear for men and women; redeveloping its men’s business including adding new tailored clothing brands, growing its key brands and expanding gifts; and refocusing its shoe assortment with more boutique, leisure and men’s brands that better coordinate with its apparel. This summer it launches a newly designed online store that will be easier to shop, with improved search and a simplified checkout. In March, Dawn Robertson joined Stein Mart as CEO.

#38 vince Making its debut on the Top 50 after issuing an IPO in late 2013, the contemporary apparel company known in particular for its cashmere sweaters welcomed back its founders Rea Laccone and Christopher LaPolice as consultants to oversee product and merchandising, and the company also added a new artistic director who previously worked with the founders, as part of its efforts to return to growth. It will look to strengthen and grow the brand while taking a prudent approach to inventory, and has also taken a break from its handbag business while it works to find a designer that will bring the category back in line with its brand DNA. This year, Vince is migrating to a new e-comm platform, and then will redesign its website. Overall sales and wholesale channel sales were down for the year, but its direct-to-consumer segment increased 25.1 percent. The company plans to add six stores this year, adding to its total of 49 U.S. stores, which includes 35 full-price and 14 outlets.

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#39 Kate spade #40 Tilly’s Its clever marketing, including its #MissAdventure series, continues to drive A near-term action plan to improve sales engagement, with its holiday #MissAdventure film debuting at No. 6 on will focus on: 1) tighter inventory flows with Advertising Age’s viral video chart in its first week. A few other highlights from greater frequency of newness that is unique 2015: 1) The brand launched two new category pillars, children’s and home; 2) to Tilly’s, and more store-specific micro-mer- it entered into eight new countries, most recently entering India via a partner- chandising. The action sports specialty retailer ship with Reliance Brands Limited; 3) e-comm, which represents 20 percent of sells more than 600 brands, with 70 percent business, grew by double digits on its flagship e-comm site in 2015, while traf- of sales coming from third-party brands, and fic and conversion on its mobile e-comm site grew at an even faster pace; 4) it it is working with its key partners on those saw great success with its buy online, ship from store program; 5) it launched initiatives; 2) fixing underperforming stores its new Kate Spade New York collaboration with Everpurse, a new and success- and adding fewer new stores. Just three new ful collection of handbags that incorporates wireless iPhone charging technol- openings are planned this year. Tilly’s will also ogy; and 6) it expanded into eight additional countries and opened 44 new develop a more efficient and smaller store stores. The company also launched its new Broome Street label, a more casual prototype; and 3) working to grow omnichan- version of the Kate Spade New York design aesthetic, and purchased the IP nel with BOPIS, and rebranding and relaunch- and related business assets of Bag Bar, a system that will allow the company to ing its customer loyalty program to offer better develop interchangeable covers for a select number of its handbag silhouettes. rewards to integrate with its new mobile app.

#41 Abercrombie & Fitch The teen market has struggled in recent years, and Abercrombie in particular has taken heat for everything from the exclusionary remarks of executives to the vibe of its product, stores and marketing, which were no longer striking a chord with its target customer. One of the company’s top priorities has been to clearly define and convey its brand positioning, and while it has more work to do, it has made progress. In efforts to improve customer engagement, it is improving the in-store experience through such changes as improved lighting and shorter lines, and also rolled out a new Hollister prototype store which is performing well. In digital, it continued to enhance its mobile capabilities with improved site design and upgraded apps. Mobile now accounts for more than 60 percent of all online traffic and nearly 40 percent of direct-to-consumer revenue. On the omni front, it expanded ship-from-store to an additional 290 U.S. stores and is activating click-and-collect and online returns to store in the U.K. In 2015, it opened six new stores in China — Greater China is now its fourth-largest market by sales volume. It also opened its first refranchise stores in Mexico and grew its wholesale business with ASOS and Next to $10 million in revenue. In addition, it launched Fierce in Sephora stores and in select duty-free shops via its partnership with Inter Parfums. At home, it is continuing to right-size its U.S. store fleet with 55 closures during the year, bringing its cumulative closures to approximately 340 stores — about a third of the fleet — over the past six years.

#42 stage stores #43 chico’s The owner of Bealls, Goody’s, Palais Royal, Peebles In December, Shelley Broader took the helm as CEO and president. and Stage Stores continues to build on its strategic Also in Q4, the owner of Chico’s, White House Black Market, and Soma initiatives by 1) refreshing 122 of its top-volume sold its fourth nameplate, Boston Proper, to investment firm Brent- stores and continuing with approximately 90 ad- wood Associates. It made other efforts to reduce its cost structure by: ditional stores this year; 2) increasing the breadth of 1) slowing square footage growth, including announcing plans to close its products, growing centralized fulfillment to more approximately 170 to 175 stores through 2017; 2) implementing an or- than 70 percent and adding a great new app — all of ganizational realignment, which included a 12 percent reduction of HQ which helped it grow its direct-to-consumer business and field management employees; and 3) reducing capital expenditures by 20 percent for the year; 3) using technology to im- by 40 percent in fiscal 2015 compared to its prior three-year average. In prove localization and personalization, to include new efforts to improve customer service, it implemented a new POS system assortment planning and size optimization programs to more than 1,500 of its stores, laying the foundation for further this year; 4) evolving assortments to be more compel- omnichannel capabilities and developed a new Client Book iPad ap- ling; and 5) adding cosmetics counters to 30 stores, plication for its associates, which allows them to access the company’s with plans for more in 2016. customer purchase history, enabling more personalized service.

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#44 Gordmans It’s on the chart, but it’s actually in the red, with a net loss of $4.3 million and profitability at -0.66 percent. Still, the company posted its first quarterly comp-store sales increase since 2012 during Q3 and its full-year comps decrease of 1.3 percent was a big improvement over the previous two years’ 4.8 percent and 7.4 percent decreases, respectively. In August, Gordman’s expanded its presence from 22 states to a national footprint with the addition of online shopping and also grew its guest loyalty program membership by 35 percent to 5 million members. It opened six new stores and closed one underperforming store, for a total of 102 stores in 22 states at year end. In 2016 it plans to implement a next-gen point-of-sale system that among other things will provide an enhanced guest experience and omnichannel functionality.

#45 Perry ellis It may not have been profitable, but it was a whole lot less unprofitable than it was the previous year, and is back on the chart with a -0.81 percent profitability, vs. -4.18 percent last year. Since exiting 30 underperforming business in the past two years, PEI has been able to refocus on its high performing core brands: Perry Ellis, Original Penguin, Golf Apparel, Rafaella and Laundry by Shelli Segal, and a year ago the company outlined its Growth and Profitability Plan, focused on international and licensing expansion, portfolio optimization, investment in its direct-to-consumer channel, better competitive positioning and cost-savings. In 2015, international revenues grew 15 percent, increasing from $90 million to $104 million and accounting for 12 percent of PEI’s total revenue mix, with much of it coming from its operations in Europe, Canada and Mexico. In addition, licensing income grew 7 percent, and an aggressive licensing strategy yielded 27 new agreements, which grew that revenue stream to $32 million in royalties for the year.

#46 Gymboree It’s still in the red, but it showed tremendous improvement over the previous year. Net sales were up, comp sales (including online) increased 1 percent, and net earnings, while still in the red, were up 98.2 percent. As for Q1 2016, the company’s fashion-right spring collection has struck a chord, with sales and earnings up over the same quarter the prior year, and comp sales up 4 percent. (Editor’s note: we cannot get enough of Gymboree’s cute clothes — it doesn’t hurt that there is no shortage of adorable tops featuring cats, with all the cat accessories to match. Nailed it!) The company, owner of the Gymboree®, Janie and Jack® and Crazy 8® brands (as well as play programs under Gymboree Play & Music®), operated 1,306 retail stores at the end of January, while its overseas franchises and Gymboree China operated 84 retail stores.

#47 Destination Maternity It was a rough year on the whole, with comp sales and gross margin struggles coming from excess inventory as well as traffic declines, with aggressive promotions and markdowns taking a toll on selling prices but not increasing basket size. In 2015, the maternity wear company invested in tools to improve inventory turn (the benefits of which were already evident with units down 11 percent at the end of the year), made progress in the implementation of its new JDA allocation software, which will allow for improved and previously unavailable micro-merchandizing opportunities at the product-class level, and implemented an improved product lifecycle calendar. This year, the company is re-platforming e-commerce with Demandware, implementing a new order management system and opening seven to 10 new stores. It will also adopt a mobile first strategy, as busy Millennial moms-to-be spend a lot of time on the go — and on their phones. The company is discon- tinuing some of its partnerships this year — it ended its leased department store relationship with Gordmans, discontinued its Two Hearts line in Sears, and is phasing out production of its Oh Baby by Motherhood line after Kohl’s decided to discontinue its license with the company in early 2017 — which will allow it to focus on core brands Motherhood and A Pea in the Pod via its many brick-and-mortar and digital channels, including through its strong leased-department relationships with Macy’s and buybuy Baby.

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#48 New york & company Another company in the red, but a little closer to pink this year, as it grew comp store sales by 3.1 percent, the highest annual comp in 10 years, and significantly improved its operating loss over the prior year. It also increased its credit loyalty share to 38 percent of sales, a record for the company. In 2016 it plans to continue the upward momentum in part by evolving its sub-brands, especially its celebrity Eva Mendes collection, as well as Seventh Avenue Design Studio, Soho Jeans and Trending Now. The company currently has 16 Eva side-by-side and 25 shop-in-shop stores, and earlier this year opened a freestanding Eva Mendes store in Florida. In Q4, it launched a new mobile site design, which led to increased sales, and in 2016, it will launch a new mobile app. In omni, it implemented Ask Us and in-store pick up options, and is seeing strong results from ship-from-store, launched in 2014. As part of Project Excellence, its initiative to improve efficiency and productivity, it is focused on speed to market, with its fast track delivery hitting 24 weeks from concept to delivery, for the first time ever. NY&Co. is also rolling out a new company-wide POS upgrade that will give mobility to sales associates via the introduction of tablets, and will be testing a new kiosk in approximately 30 to 35 stores.

#49 Lands’ end In the difficult retail environment it’s financial performance was nothing to write home about — but it was also a year of transition for the company, which began with putting in place a new management team, digging into customer data to improve its product rel- evance and assortment, and focusing on more strategic marketing. The company received great media exposure and customer response from the launch of two pop-up stores, one on Fifth Avenue in New York City and another in Boston. It worked to improve catalog productivity by improving their look and mailing primarily to active customers, and is striving to broaden its assortment of non-seasonal products so as not to be as vulnerable to weather fluctuations. In e-comm, Lands’ End has adopted more storytelling elements, streamlined checkout and simplified the online shopping experience. With traffic to Sears locations down for the year, so were comps; the company ended the year with 227 shops in Sears vs. 236 the prior year. This year, the company will invest in its finance functions, merchandising operations and its inventory planning systems, after which its multi-year ERP plan will be approximately 75 percent complete, with remaining investments going toward its order management and warehouse management systems.

#50 Destination XL Its position at the bottom of the chart belies the upward trajectory of the big-and-tall retailer, which has undergone an enormous transition since 2012, now has five full years of experience with the DXL concept (after rebranding from Casual Male) and has developed and refined a steady operating model, with 15 consecutive quarters of comp-store sales growth of more than 8.5 percent. Its successful marketing strategies — brand awareness has increased from just 13 percent three years ago to 38 percent — are enabling fewer discounts, and less spending on marketing. Better awareness also boosted the conversion rate of customers migrating from Casual Male to DXL by five percent, which drove a 6.2 percent increase in total transactions at DXL stores, with average dollar spend up 3.3 percent for the year. Now five quarters into its smaller-format stores, it’s been able to develop an effective model for those as well. This year, it plans to open approximately 31 DXL stores (and close approximately 26 Casual Male XL stores and three Casual Male outlets) with roughly two-thirds being smaller format or outlet stores. In Q4, the company — which already has online demand from more than 100 countries that it is servicing today — announced plans to expand internation- ally with the hiring of Nancy Youssef, an SVP of international business development, which it will do via a franchise and licensing strategy. It already has one franchise store open in Kuwait City, and expects others to open in spring 2017.

— Jordan K. Speer is editor in chief of apparel. She can be reached at [email protected].

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