The Power of Retail

Abercrombie & Fitch is finalizing its overseas expansion plans as it feels that the major growth that the company will see will be from international markets, such as Canada, Europe and Asia. There are three brands within the company now; Abercrombie is the premier brand, Hollister is the slightly lower priced brand and Ruehl is brand new and is targeted at young adults. A fourth brand called Gilly Hicks will be introduced next year which will be devoted to lingerie and accessories. The company opened 6 Abercrombie and Hollister stores in Canada in 2006, which were also its first international stores. So far the Canadian stores have been performing well and the company is keen to launch its like of Abercrombie kids there as well.

With a store opening in London in March 2007 and the next one planned for Tokyo in 2009, the company is keen to step up its international ventures. According to Lois Huff, senior vice president of TNS Retail Forward, the premier consulting group of the retail industry, the stores are likely to do very well in Japan as consumers there still “embrace the American lifestyle”. The main issues to deal with in international expansion are real-estate prices, consumer behavior and shopping patterns and a much higher risk and cost of investment.