The mercilessly competitive retail environment has claimed another victim: Lucy Activewear has succumbed to pressure from larger brands such as Gap Inc.‘s Athleta and Lululemon.
Founded by former Nike executives in 1999, Lucy in 2007 was acquired for $110 million by VF Corp. Lucy, which began as an online retailer, launched physical stores after the dot.com bust. The brand focused on yoga, designing and manufacturing its own jackets, bras, tops and bottoms for what became a fiercely-loyal customer base. It also sells products for the gym, running and other sports, backed up by design teams with experience in those areas.
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Within a year of being bought by VF, Lucy’s store count grew to 65 units. That’s small in terms of economies of scale and Lucy wasn’t privy to real estate deals cut by behemoths such as Gap and Victoria’s Secret. A competitor of Lucy’s, Yogasmoga, filed for bankruptcy protection at the end of last year and has closed nearly every store in the chain, including high profile locations in Manhattan, San Francisco and Los Angeles.
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Lucy’s store fleet was whittled down to 44 units, all of which will be shuttered. “Every store is a little different,” said a Lucy employee on Saturday, noting that most locations will close by the end of 2017 or early 2018, depending on when the leases expires. The Northwest Couch Street unit in Portland, Ore., where Lucy was born, will shut in August. New products will be delivered to stores through the fall.
Lucy’s long-term future remains murky. The brand will be merged with The North Face, which is also owned by VF.
Athletic wear, once the hottest area of apparel in department and specialty stores, may have lost some of its appeal, which is impacting sporting goods chains. Sports Authority, once the biggest retailer of athletic wear and gear in the U.S., filed for bankruptcy last year and closed all 140 stores after failing to reach an agreement with creditors, while Sports Chalet shuttered its 48 units.
Lucy also was competing with retailers such as Target and Old Navy, which sell similar items for less, albeit not with Lucy’s performance features.
Lucy relocated to VF headquarters in Greensboro, N.C., and moved its distribution operations from Portland to Visalia, Calif.
Former Lucy chief executive officer Mike Edwards said at the time, “Hard to argue with VF’s decision to leverage [Lucy’s] infrastructure. But tough news for the associates and the Portland economy at large.”