Wet Seal may be the next in line for inventory liquidation, just like their contemporaries, dELiA*s and DEB Shops. Many fashion retailers seem to be having some issues addressing the desires of modern women.
Wet Seal, a former staple of the 1990’s shopping mall, may be the next victim in this failing generation of clothing retailers. Bank of America, the company’s lender, has begun to carefully scrutinize their cash flow in the wake of reportedly low earnings.
The executive responsible for overseeing store operations issued their resignation on Friday, following a dismal 5 cents per stock-share closing price. It would be a prudent move for Tom Rothman and Wet Seal to further rethink their staffing plans at the corporate level. Current executives are clearly out of touch with the climate of today’s fashion market.
The company recently settled a discrimination lawsuit, based upon evidence that they systematically transferred black employees to lower-volume stores. Wet Seal consented to pay $7.5 million in damages, an expenditure scarcely affordable.
Compared to their primary competitors like Forever 21 and Charlotte Russo, it’s clear that Wet Seal has some improvements to make. The company needs to embrace the fashion ideals of young women today: fun, diversity and individualism.