Lululemon (NASDAQ: LULU) and Aeropostale (NYSE: ARO) were two retailers that appeared in a list of 10 brands likely to disappear by 2015. The brands were identified by 24/7 Wall St. in an annual listing of struggling brands possibly on the verge of expiration.
The list includes brands that 24/7 Wall St. said will need to be sold if they stand a chance of surviving. But don't be fooled: Some may simply be eliminated because their success is likely to attract an acquisition or a merger.
Battling in an aggressive business climate, Lululemon was No. 1 on the list, thanks to several other retailers who recently entered the yoga pants domain. But competitors were not the only sore spot for Lululemon. The company recalled many of its yoga pants last year because they were too sheer, resulting in management changes and a loss of revenue.
Also on the list at No. 6. was Russell Stover, the third-largest chocolate company in the United States. It was recently bought out by Lindt, but competing with big names like Hershey's is no small task.
Shutterfly (NASDAQ:SFLY) came in at No. 7 because of its turbulent business area. In the age of social media, the company is up against free photo sharing services such as Instagram and Facing. The e-commerce site is currently looking for a buyer.
And last, but not least, was teen fashion maker Aeropostale. Like its competitors Abercrombie & Fitch and American Eagle Outfitters, the brand now has to compete with the influx of inexpensive fashion apparel on the market. Last quarter Aeropostale reported a 12 percent drop in revenue of $396 million, and same-store sales were off by 13 percent. Consequently, the retailer has been forced to close stores and cut staff.
24/7 has been making predictions for five years and 24 out of the 49 companies that made past lists have disappeared. Each identified brand demonstrates at least one indicator of trouble on a list of seven, ranging from declining sales and losses or rising costs to companies that have been sold or declared bankruptcy.
-See this 24/7 Wall St. article
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