Analyst John Kernan wrote in a February note, rating Burlington shares an “outperform.” “TJX, Ross Stores and Burlington Stores are built around a speed-enhanced off-price model of fast inventory flows and a treasure hunt shopping experience, with goods flowing in and out of their stores on a weekly basis. (For comparison, NPD data shows department stores’ market share at 20.5 percent and specialty stores at 24.2 percent.)“Our market share model suggests the off-price story is still in early innings,” Cowen and Co. Very, very clean.”With a market share of just 11.4 percent, per data from The NPD Group Inc., market watchers say off-price sellers like Burlington have significant long-term upside. It’s a cash-price one-time sale. “We have reliable economics — when you ship those products, you know exactly what it’s going to cost you. I established we’re going to buy a third of our goods before the season begins and two-thirds after the season begins … We had POS markdowns, we had sales, we participated in Black Friday — we eliminated all of that.”Kingsbury said the decision to ditch massive promotions was the result of his recognition that the firm — which dropped the term “coat factory” from its name around 2009 to emphasize its expanded assortment — could better leverage its everyday-low-price model without sweeping markdowns.“We want customers to come into our store and feel really good about buying the product it’s not going to go on sale a week later,” he said.According to Burlington’s chief, the company has also built in perks for its brand partners, which include athletic power players Reebok and Adidas, as well as fashion footwear-makers Steve Madden and Nine West.“We make it easy,” he said.
Other guest speakers and panelists included Michael Evans, Alibaba president Steven Kolb, CFDA president and CEO Ted Dagnese, chief supply chain officer at Lululemon Athletica and Dave Wheeler, chief product supply officer at New Balance.
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