Retail, Catalog Growth Converge at Urban Outfitters

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A review of Urban Outfitters Inc.'s fourth-quarter and year-end results for fiscal 2005 reveals how retail and catalog growth can go hand in hand.


The Philadelphia-based multichannel marketer of men's and women's apparel, accessories, shoes, housewares and gifts said net sales jumped 43 percent in the quarter ended Jan. 31 to $251.6 million. Comparable-store sales climbed 13 percent. For the year, sales rose 51 percent to $828 million.


Fueling the growth in the fourth quarter was a combination of new store openings, the strong gain in comparable-store sales, a continuing surge in the company's direct-to-consumer business and a jump in wholesale volume for its Free People brand, company executives said in a conference call discussing the results last week.


Total direct sales skyrocketed 69 percent in the quarter to $33 million. The gains resulted from a 93 percent combined increase in catalog circulation as well as an improvement in the catalog response rate and a rise in average order value, executives said.


This year, the firm will increase circulation for its Anthropologie catalog 20 percent and its Urban Outfitters book 40 percent.


The company recently tested a new Anthropologie accessories catalog and said initial results appear "very promising." According to Women's Wear Daily, the company will mail a second Anthropologie accessories catalog in the fall.


To help drive Internet sales, executives said they plan to add more Web-only product to the brands' Web sites.


To accommodate the anticipated increase in direct orders, Urban Outfitters will lease a new direct fulfillment and call center that is four times larger than its current space, with the capacity to handle six to eight times its current volume. It expects the facility to be operating by the fall.


Chantal Todé covers catalog and retail news and BTB marketing for DM News and DM News.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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