MITCHELLS’ DAN FARRINGTON ON NAVIGATING ROUGH WATERS

Q: So how are you Dan? How’s business?

A: I’m fine personally, but business is extremely tough right now. Even our stores that have been open a while are not getting much of a sales bump. Fortunately, we had no looting at any of our locations, although we boarded up Seattle, Portland, and San Francisco. Despite looting all around us, we were spared this time. And we’re very encouraged to have had a nice week before Father’s Day—our best week in months!

Q: But, of course, Mitchells will make it through this: you’ve survived many crises and you’ve always come out stronger…

A: Truthfully, the situation is worse than I anticipated: I talked to an industry friend a few weeks ago who insisted that the pandemic coupled with stock market uncertainty and record unemployment created the worst possible scenario for retailers. I agreed that it couldn’t get worse. And then it got worse, especially for city stores where looting became a new reality. 

So, while I know our stores are in a strong enough position to survive, I fear not everyone in our industry will make it. It will be hard to recoup the losses of being closed for so many months followed by decreased consumer demand for perhaps a long stretch. For us, Seattle and San Francisco are just opening now; our other stores opened slightly earlier but people are not rushing in. We’ve been running down over 60 percent. Yes, we made it through ’08-’09, but that was just an economic crisis; this is much bigger and more complicated. Even with stores reopening and even if the market holds steady, going into physical stores to shop is not a high priority for most customers. The cruelest part is that we were doing great prior to the pandemic. We’ve lost a lot of momentum.

Q: Good thing you invested heavily in your website prior to all this…

A: Yes, but we always viewed our website as an omnichannel opportunity, not as a top door. We never planned it to be 20-30 percent of our volume; we had been happy at five percent or so. Fortunately, we have a world-class site which proved to be the only way to see into our stores and make some shopping possible while we were closed. It was a lifeline and should grow in importance, as will digital selling in other forms.        

Q: How will you be tweaking your mix in light of the current situation?

A: Well at the moment, we’re not tweaking much. We have plenty of inventory; we don’t need anything else so we’ve canceled all orders for summer and we’ve canceled half of fall. As for spring ‘21, we’ll have some of our freshest goods from spring ‘20 which, for the first time ever, we’ve packed up to put back out in November through March. There’s no way we’ll move through all that we have now so why try? The good news is that it’s all paid for so we’ll have great product flowing back into the stores right when we need it with no invoices to follow.

Q: What’s selling now?

A: The more casual categories are performing best: polos, tees, shorts, activewear, sneakers. And although we expect another wave of casualization, we can’t give up on the sportcoat—it’s critical that we keep that business going. Suits, unfortunately, will likely be relegated to rare occasions until our customers are back in the offices regularly and traveling again. A bright spot for us before COVID-19 was formalwear: We had ramped it up expecting big business for weddings and other black-tie events and now a lot of that is on hold. It will be a rough couple of seasons ahead. If we can stop the slide before the holidays, it will be a big victory. If we can get real momentum with sportswear, casual footwear, and hold on to a lot of the sportcoat business, we can come back in 2021 very strong. So much will depend on factors out of our control and still unfolding, so we must be prepared for the worst as we try to find the right path back.     

Q: Can you predict spring 2021?

A: It’s going to be a very difficult buy. We still won’t know the depth of the problem or what’s to come, we might have to work much of it virtually, and we’ll buy to projected sales rather than last year’s orders so it’s a tough formula for vendors. We have to be realistic and the current reality is pretty tough. Our vendor partners that have their own retail stores are feeling the pain with us in real-time, but for the pure wholesale side, the tsunami will first hit them in spring ’21.

Q: Is there a silver lining to any of this?

A: Having so much time together with my wife and four very young kids is a gift that could not have happened in any other way but this. As for business, crisis always makes the survivors stronger and I know that our industry will innovate, out of need, in ways that will make us all better for some time to come. Just as retailers love going against comp sales from a blizzard weekend, I expect big increases for March-June 2021. There’s the silver lining.