Fred Segal closes all of its stores, Chanel raises 700 million euros

This week in fashion news: One fashion retailer pushes back its sales targets, while mega luxury players look to the private debt market to raise $$$.

Fred Segal shutters its stores

It’s the end of an era; iconic California-based retailer Fred Segal has closed its last two stores. The brand, which was established in the 1960s, had nine locations across California, and in Taipei and Switzerland. But recent challenges including Covid ultimately brought about its downfall…for now.

Why this matters: A pullback in consumer spending has impacted numerous brands, including high-end fashion labels and more affordable ones like Nike, which has also recently reshuffled its executive roster due to a continuously unsteady retail landscape impacting the brand’s bottom line.

Hugo Boss cuts earnings forecast

Hugo Boss’ operating profit fell 42% while revenues dropped 1% in Q2, missing analysts’ expectations. The German retailer further iterated it will be employing cost-cutting measures in order to revitalize profits over the coming year.

Why this matters: Like many other brands, Hugo Boss has had a tough ride lately. Its share price dropped 10% in mid-July, to its lowest level since April 2021, while its sales and profit outlook fell as it struggled with weakened demand in China and the UK.

Chanel raises 700 million euros

Chanel, the high-end French fashion house, has raised more than 700 million euros ($758 million) from a privately placed bond sale, sources told Bloomberg.

Why this matters: Despite double-digit sales and profit growth last year, Chanel recently warned the industry about growing challenges. And rightfully so: Even big players like Burberry have been hit with a sales slump. The retailer reported a dramatic 34% drop in annual profit in its Q4 earnings report.