But surfers themselves have gradually deserted the fashion offerings of Quiksilver, Billabong and Rip Curl and, regardless, are not the fashion leaders they once were.
Non-surfing consumers now have less incentive than ever to adopt the traditional surf aesthetic still on offer. The outlook now is bleak. The Billabong write-down announcement followed a The news was emblematic of an industry-wide crisis.
Billabong was publicly listed in but its resultant buying spree, which included watch company Nixon and cult skate brand Element, has had dire consequences for the parent company. The one-time market behemoth was subsequently decimated by store closures, staff lay-offs and growing debt. California-based surfwear retailer Pacific Sunwear has been hit equally hard. As his surfing empire crumbled around him, Merchant could at least be thankful that the sale of some of his shareholding and related diversification had insulated him against a personal wipe-out.
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Other options. Close drawer menu Financial Times International Edition. What can we learn from that? And apparently they agree with Billabong management that the earnings lost from the sale of half of Nixon will be made up for by store closings and expense reductions being undertaken.
Just wanted to say thanks for your input and insight in to this as well as all the other topics you tackle. I am super interested in how this all plays out and the long term effect on us as independent retailers, and specifically as an independent retailer who counts 3 of the Billabong brands as our top brands in there respective categories.
Nice work front running this situation a few months ago. Crazy how this recession is pulling down even the strong players. We all learned what Vans did by opening retail stores once you have enough brands or product to fill most of a store: guaranteed sales quarter after quarter. Plus you get a larger portion of your line in front of consumers.
But mainly reliable sales. We also know how expensive it is to close retail stores, thanks Mr. Rags and Pac Sun for that lesson. Now the question becomes, has action sports actually reached the maximum number of people that are interested worldwide?
Was Nixon the most profitable non-core piece of the Billabong family? Are these non-core products needed to grow the companies outside of the finite number of participants and followers? Another question I have is whether action sports companies have done enough to move a significant portion of their sales to retail internet? At the time Billabong said TPG had not withdrawn from the sales process but had concerns that the parties were working through.
This was TPG's second takeover bid for Billabong. Its first unsuccessful bid for the surfwear retailer was rejected by Billabong in February for being too low.
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