The Talbots, Inc., and Subsidiaries: Accounting for Goodwill

3472 Words14 Pages
3254 OCTOBER 10, 2008 WILLIAM J. BRUNS The Talbots, Inc., and Subsidiaries: Accounting for Goodwill “This is what passes for good news at Talbots, Inc. these days: The bad news wasn’t as bad as most people had feared. Talbots, the women’s clothing retailer from Hingham [Massachusetts], told investors yesterday that it lost $171 million in the final quarter of its fiscal year, when sales fell nearly 8 percent. The company’s stock climbed more than 11 percent, its best day in over a month. — Steven Syre, “Losing, but in a good way,” The Boston Globe, March 13, 2008, p. E1. Talbots, Inc., was an international specialty retailer and direct marketer of women’s apparel, shoes, and accessories. On May 3, 2006, the company acquired J. Jill, another multi-channel specialty retailer of women’s apparel. Both companies operated stores under their brand names, and both made extensive use of sales catalogs and websites. Both focused their selection and merchandising on women 35 and older, but each had a different style. Talbots brand merchandising promoted the “current classic look” emphasizing timeless current styles and quality, a variety of key basic and fashion items, and a complementary assortment of accessories and shoes to enable customers to assemble complete wardrobes. Consistency in color, fabric, and fit of Talbots-brand merchandise allowed customers to create wardrobes across seasons and years. The company believed that a majority of Talbots-brand customers were high-income, college-educated, and employed primarily in professional and managerial occupations. J. Jill merchandising strategy focused on offering easy sophistication for every day. The company believed that J. Jill brand merchandise reflected its core customers’ desires and needs—style, comfort, individuality, artistic simplicity, a woman’s version of femininity and community. Customers were thought

More about The Talbots, Inc., and Subsidiaries: Accounting for Goodwill

Open Document