Chico's FAS Stock

Chico's FAS, Inc. operates as an omnichannel specialty retailer of women's private branded, casual-to-dressy clothing, intimates, and complementary accessories.

The company sells its products through retail stores, catalogs and via its websites at www.chicos.com, www.chicosofftherack.com, www.whbm.com and www.soma.com.

As one of the leading fashion retailers in North America, Chico’s FAS is a company of three unique brands operating under the Chico's, White House Black Market (WHBM) and Soma brand names - each thriving in their own white space, founded by women, led by women, providing solutions that millions of women say give them confidence and joy. The company sometimes refer to its Chico's and WHBM brands collectively as its Apparel Group. The company’s distinct lifestyle brands target the needs of fashion-savvy women with moderate-to-high household income levels.

The company utilizes an integrated, omnichannel approach to managing its business. The company wants its customers to experience its brands holistically and to view the various retail channels it operates as a single, integrated experience rather than as separate sales channels operating independently.

The company offers high quality and unique merchandise, supported by outstanding personalized customer service. While each of the company’s brands has a distinct customer base, the overall portfolio caters to a broad age and economic demographic, with moderate-to-high household income levels.

Brands

Chico’s

Chico’s brand primarily sells exclusively designed, private branded clothing focusing on women with moderate-to-high household income levels. The style sensibility is chic and artful, and the brand is known for color and unique completer pieces, from signature jackets to jewelry and accessories that finish the look. Chico's apparel, including the Black Label, Zenergy and Travelers collections, emphasizes an effortless, chic style, comfort and relaxed fit. Accessories and jewelry are original and designed to elevate the clothing assortment, allowing the company’s customer to individualize her personal style.

The distinctive nature of Chico’s clothing is also reflected in its sizing, which consist of sizes 000, 00 (size 0-2), 0 (size 4-6), 1 (size 8-10), 2 (size 12-14), 3 (size 16-18) and 4 (size 20-22). Chico’s will occasionally offer half-sizes (up to 3.5), one-size-fits-all, petite sizes, short and tall inseams, and small, medium and large sizing for some items. The relaxed fit allows the company to utilize this kind of sizing and thus offer a wide selection of clothing without investing in a large number of sizes within a single style.

Chico's is vertically integrated, controlling almost all aspects of the apparel design process, including choices of pattern, print, construction, design specifications, fabric, finishes and color through in-house designers, purchased designs and independent suppliers.

White House Black Market

WHBM is dedicated to being a go-to style destination and authority on wardrobe building. WHBM primarily sells exclusively designed, private branded clothing focusing on women with moderate-to-high household income levels. WHBM offers a modern collection to support her every lifestyle moment, selling stylish and versatile clothing and accessory items, including everyday basics and premium denim, polished casual apparel, tailored relaxed workwear, black and white pieces, and feminine all-occasion dresses. The accessories at WHBM, such as shoes, belts, scarves, handbags and jewelry, are specifically designed to coordinate with each collection, allowing customers to easily individualize their wardrobe selections.

WHBM uses American sizes in the 00-14 range (with online sizes up to 16), including petite sizing, as well as short and long inseams, and small, medium and large sizing for some items. The fit of the WHBM clothing is tailored to complement the figure of a body-conscious woman, while still remaining comfortable.

WHBM is vertically integrated, controlling almost all aspects of the apparel design process, including choices of patterns, prints, construction, design specifications, fabric, finishes and color through in-house designers, purchased designs and independent suppliers.

Soma

The Soma brand primarily sells exclusively designed, private branded lingerie, sleepwear and loungewear products focusing on women who want solutions that are as comfortable as they are beautiful. The Soma brand's core franchises emphasize innovative styles that focus on fit and uncompromising comfort, including Bodify, Enbliss and Vanishing Back bras, Vanishing Edge panties and Cool Nights sleepwear.

Bras range in size from 32A-46H. The sleepwear and loungewear offerings range in size from extra small to extra-extra-large.

The Soma team develops product offerings by working closely with a small number of independent suppliers to design proprietary products in-house and, in some cases, designs provided by its independent suppliers under labels other than the Soma brand.

Business Strategy

The company’s overall business strategy focuses on building a collection of distinct high-performing retail brands primarily serving the fashion needs of women with moderate-to-high household income levels.

The primary function of the company is the production and procurement of beautiful merchandise that delivers the brand promise and brand positioning of each of its brands and resonates with customers. The company pursues improving the performance of its brands by building its omnichannel capabilities, growing its online presence, managing its store base, executing marketing plans, effectively leveraging expenses, considering additional sales channels and markets, and optimizing the merchandise offerings of each of its brands. The company continues to invest heavily in its omnichannel capabilities so its customers can fully experience its brands in the manner they choose.

The company views its stores and Company-operated e-commerce websites as a single, integrated sales function rather than as separate, independently operated sales channels. As a result, the company maintains a shared inventory platform for its primary operations, allowing it to fulfill orders for all channels from its distribution center (DC) in Winder, Georgia. The company’s domestic customers can return merchandise to a store or to its DC, regardless of the original purchase location. In addition, the company’s shared inventory system, enables customers to make purchases online and ship from store. The company’s mobile apps launched in 2022, as well as its previously introduced customized, branded digital styling software tools, StyleConnect and MY CLOSET and its Buy On-Line, Pick-up In-Store (BOPIS) are driving customer engagement, loyalty and cross-channel shopping.

The company seeks to acquire new customers and retain existing customers by leveraging existing customer-specific data and through targeted marketing, including digital marketing, social media, television, catalogs and mailers. The company seeks to optimize the potential of its brands with innovative product offerings, potential new merchandise opportunities, and brand extensions that enhance the current offerings, as well as through its continued emphasis on its trademark Most Amazing Personal Service standard. The company also will continue to consider potential alternative sales channels for its brands, including international franchise, wholesale, licensing and other opportunities.

The company focuses on driving profitable growth through four strategic pillars of being customer led, product obsessed, digital first, and operationally excellent.

Customer Service Model

The company strives to deliver outstanding and personalized service to its customers through its trademark Most Amazing Personal Service standard. The company’s Stylists are encouraged to develop long-term relationships with their customers, to know their customers’ preferences and to assist its customers in selecting merchandise best suited to their tastes and wardrobe needs. The company’s Stylists utilize tools including its personal closet feature, MY CLOSET, and StyleConnect to access customer purchase history and style preferences, offer personalized recommendations for new products, and connect with her via email, text or chat. These tools allow the company’s Stylists to meet its customer's needs whenever and wherever she wants to shop.

The company also serves its customers’ needs and build customer loyalty through its customer rewards programs. The company’s programs are designed to reward its loyal customers by leveraging the rich data its customers share with it to deliver a relevant and engaging experience with its brands. The benefits provided are routinely evaluated in conjunction with the company’s overall customer relationship management and marketing activities to ensure they remain a compelling reason for customers to shop at its brands.

The company’s customer rewards programs in each of its three brands were relaunched in 2022. The enhanced programs utilize a tier model to incrementally reward customers that spend more and are focused on building customer relationships and increasing frequency.

Boutiques and Outlet Stores

The company’s boutiques are located in upscale indoor shopping malls, outdoor shopping areas and standalone street-front locations in the U.S., Puerto Rico and the U.S. Virgin Islands. Boutique locations are determined based on various factors, including, but not limited to: market and demographic characteristics, nearby competitors, the company’s own network of existing boutiques, the location of the shopping venue, including the site within the shopping center, proposed lease terms, anchor or other co-tenants, parking accommodations and convenience. The company’s merchandise is also sold through international franchise locations in Mexico, including boutique locations, as well as shop-in-shop formats within a department store environment.

The company’s outlet stores are primarily located in quality outlet centers. The Chico’s and WHBM brand outlets contain a mixture of made-for-outlet and clearance merchandise. The made-for-outlet product carries a higher margin than the clearance items from the company’s boutique stores. Soma outlets contain a mix of boutique and clearance merchandise. The company also sells clearance merchandise on its brand websites and at www.chicosofftherack.com.

Information Technology/Data Analytics

The company is committed to making ongoing investments in information technology systems to support its strategies within customer, digital, omnichannel and supply chain. The company’s information systems are designed to enable it to obtain, analyze and act upon information on a timely basis and to maintain effective financial and operational controls.

Digital Commerce

Each of the company’s brands has a digital presence: www.chicos.com, www.chicosofftherack.com, www.whbm.com and www.soma.com. These sites provide customers the ability to shop the company’s stores 24/7, digitally browse its inventory prior to making a trip to its stores or locate a store near them. Customers can choose to buy online, pick-up in store (BOPIS), pick up curbside or have merchandise shipped directly to them. Customers can also choose to engage with online content to learn more about the stories of how the company’s products were made or read customer reviews on the site to help influence their purchase. The company also offers various payment methods including buy now, pay later.

The company’s websites play a vital role in both its omnichannel strategy and the overall shopping experience of how it continuously put its customer in the center of everything it does. Many products are exclusively available online, including extended sizes, additional style and color choices and clearance items. Online merchandise is also available for order through the company’s call center and through clienteling applications in its stores. The company also utilizes ecommerce solutions and are constantly exploring new digital opportunities to expand its customer base and drive sales.

The company remains focused on its omnichannel approach through continuous optimization to all brand websites, including new features, functionality, search engine optimization and content designed to improve and evolve the customer's experience.

Marketing and Advertising

The company’s brands use industry-leading transactional data to develop targeted and effective marketing strategies. To optimize its marketing efforts and to attract new customers, the company continues to shift its advertising from traditional media, instead placing more emphasis on digital media. The company also uses predictive modeling and advanced segmentation methodologies to drive customer retention and reactivation.

The company uses the following marketing and media-mix programs to engage current customers and attract prospective customers:

Digital marketing: mobile paid search, product listing ads, display banner advertising and remarketing, affiliate programs;

Social marketing: organic and paid efforts across social platforms;

Customer Rewards programs;

Editorial content;

Public relations; and

Charitable giving and outreach programs.

In 2023, the company’s marketing efforts will focus on retaining existing, reactivating lapsed and attracting new customers to its iconic brands' differentiated positioning by leveraging advanced analytics and tools that support audience segmentation and personalization.

Merchandise Distribution

The distribution function for the company’s brands is primarily handled from its DC in Winder, Georgia. The company’s DC has been granted Foreign Trade Zone status from both the U.S. Department of Commerce and U.S. Customs and Border Protection.

Trademarks and Service Marks

The company is the owner of certain registered and common law trademarks and service marks (collectively referred to as Marks).

The company’s Marks include, but are not limited to: BODIFY, CHICO’S, CHICO'S OFF THE RACK, CHICO'S REWARDS+, COOL NIGHTS, EMBRACEABLE, ENBLISS, FLEXICUP, FLOATAWAY WIRE, NO IRON, SMART BRA, SOMA, SOMA INTIMATES, SOMA REWARDS+, SO SLIMMING, STYLECONNECT, TRAVELERS, VANISHING, VANISHING BACK, VANISHING EDGE, WHBM, WHBM FORME, WHBM REWARDS+, WHITE HOUSE BLACK MARKET and ZENERGY. The company has registered or are seeking to register a number of these Marks in the U.S., Canada, Mexico and other foreign countries.

Government Regulation

The company is subject to various laws and regulations regarding its products, including the Consumer Product Safety Act, the Flammable Fabrics Act, the Textile Fiber Products Identification Act, the rules and regulations of the Consumer Product Safety Commission and various environmental laws and regulations.

History

Chico’s FAS, Inc. was founded in 1983. The company was incorporated in 1983.