Given the success Lands’ End has had with its second channel, the Internet, some observers don’t rule out the possibility that the company will soon start selling through a third channel: retail.
The company has 16 outlet stores in Wisconsin, Illinois, New York, and the Minneapolis-St. Paul airport. Opening full-price stores, says spokesperson Charlotte LaComb, is “something we should consider.” But, she says flatly, “Nothing is on the horizon.”
Kevin Silverman, an analyst with ABN-AMRO, thinks Lands’ End should move into retail sooner rather than later. “Lands’ End could follow the example of Coldwater Creek,” he says. Coldwater Creek slowly opened stores based on the zip codes of of the more productive names in its house file. “Lands’ End would be a stronger national brand reaching a wider audience,” Silverman says.
But others are less bullish. “When you open a retail store, your fixed costs soar, and there’s little margin for error,” says Ken Gassman, an analyst with Davenport Securities. For instance, a company could become bound to a costly store lease that it could not get out of even it decided to close the store.