Is Abercrombie & Fitch Losing Its Shirt?

Apparently, half-naked models aren’t enough to entice customers anymore -- at least in the case of upscale retailer, Abercrombie & Fitch. Their once-enticing skimpy image is now resulting in nothing more than skimpy sales.

The trendy teen chain has again reported a troubling decline in sales -- 21 straight months of declines, actually, in stores that have been open for over a year. Reports showed a 19 percent drop in December, a month that most retailers depend on to bolster their year-end profits.

Even with last year’s decline worse -- at 24 percent -- analyst Eric Beder of Brean Murray, Carret & Co. described the last two years as a “jaw-dropping 40 percent” decline. He also added what many of us had suspected all along: the store's "business model now appears fully broken."

With stock prices that once topped $80 a share, today it's worth nearly a third of that, which doesn’t come as any surprise. What is surprising though is the retailer’s response to the crisis: Nothing.Continue reading...