News Briefs

The events in the Red Sea are already causing a serious headache for U.S. businesses in both the short- and long-term.

In the short-term, ocean-freight costs for shipments bound for the East Coast from China will continue to increase. Prices are already up by 52% since the crisis began, as ships look to reroute around South Africa as part of their trans-Atlantic route, leading to a delay of up to three weeks. 

While East Coast shipments are bearing the brunt, businesses are increasingly looking to reroute shipments entirely to go to West Coast ports, pushing up prices there as freight firms adjust their capacities. Businesses are now looking at spending $1,000 more for West Coast shipments than they were before the situation in the Red Sea began.

Businesses will be facing delays in receiving stock, which will have the most significant impact on those selling seasonal goods. In the longer-term, lead times will increase for imported goods, meaning businesses will have to shift their normal decision-making timescales to ensure they have adequate stock.

It is impossible to predict what will happen next, and, with the geopolitical situation in the region showing no signs of abating soon, businesses need to brace themselves for long-term disruption and restart conversations around onshoring or nearshoring to boost resilience.

Matthias Menck is principal consultant at supply chain and procurement consulting firm at Proxima.

L’Occitane is making a change to its senior leadership structure.

The sustainable beauty and skincare company said that the responsibilities of CEO and group managing director will be combined into one role, effective April 1. André J. Hoffmann, acting CEO, has decided to step down from the role.  Laurent Marteau, the group's current managing director, has been appointed CEO of L’Occitane Group. 

As part of the transition. Hoffmann will remain an executive director and board member and continue to focus on strategic, policy and leadership matters within the company

Marteau has over 20 years of experience in the global beauty industry. He worked for the LVMH Group in various senior management roles and countries for 15 years before joining the La Prairie Group in 2014 as VP for global travel retail & special channels.

In 2020, he expanded his responsibilities and was made VP for Europe, the Americas, the Middle East and Africa. Marteau joined the L'occitance Group as group managing director in 2022.

“As our group grows, we need to evolve,' said Reinold Geiger, chairman, L’Occitane Group. “Laurent embodies the L'Occitane Group's entrepreneurial mindset and deep commitment to people and nature. His in-depth knowledge of the global market, combined with an inclusive leadership style, makes him a strong CEO to bring together a multi-brand and multicultural Group delivering value for all our stakeholders.'

L'Occitane operates approximately 3,000 stores across the globe. 

CVS Health has made it permanent.

The pharmacy and health care company appointed senior VP of corporate finance and interim CFO Tom Cowhey as its next CFO.  Cowhey joined CVS in February of 2022. He previously served as CFO of Surgery Partners Inc., and before that spent more than a decade at Aetna in various strategy and finance roles.

“We are fortunate to have someone of Tom's caliber and experience already within CVS Health today and ready to take on the role,” said CVS Health president and CEO Karen S. Lynch. “His experience in health care is deep and broad, and he will drive continuity for our strategy and delivering on our commitments.”

In addition, Mike Pykosz, CEO of Oak Street Health and interim lead of Health Care Delivery, has been formally appointed president of Health Care Delivery.  He joined CVS Health following the acquisition of Oak Street Health in May 2023. During his time at CVS, Pykosz has been focused on continuing to run the Oak Street Health business, while also helping to unify all of CVS Health’s care delivery assets.

“Mike is a natural fit to lead the execution of our health care delivery strategy,” said Lynch. “There is real innovation and value to be unlocked as Mike unifies our clinic-based and home health assets."

Chico’s FAS has gone private.

The women's specialty apparel retailer announced the completion of its acquisition by private equity firm Sycamore Partners, for $7.60 per share. The all-cash transaction is valued at approximately $1 billion.

With the completion of the transaction, Chico's FAS shares of common stock have ceased trading and are no longer listed on the New York Stock Exchange.

"Completing this transaction represents the beginning of an exciting new chapter for the company's three iconic brands — Chico's, White House Black Market and Soma," said Stefan Kaluzny, managing director of Sycamore Partners. "We look forward to supporting the company's more than 14,000 talented associates as they continue to deliver best-in-class product assortments to their loyal customer base and help these brands reach their fullest potential."

As of Oct. 28, 2023, Chico’s operated 1,256 stores in the U.S. and sold merchandise through 58 international franchise locations in Mexico and through two domestic franchise locations in airports.

"Joining the Sycamore portfolio of leading retail brands marks an important milestone for Chico's FAS and continues our journey as a customer-led, product-obsessed, digital-first, and operationally excellent company," said Molly Langenstein, CEO and president, Chico’s FAS. "We look forward to working together to reach even greater levels of success."

Solomon Partners, L.P. acted as financial advisor to Chico's FAS, and Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal advisor.

UBS Investment Bank acted as financial advisor to Sycamore Partners and Kirkland & Ellis LLP acted as legal advisor.

It’s been a while since a product at Target caused a shopping frenzy. But that’s what a limited-edition giant water bottle just did.

On Dec. 31, Target released a special “Galentine’s Collection” of Stanley’s iconic, cult-fave insulated beverage tumblers (the most popular is the 40-ounce “Quencher”) in red and pink hues. The assortment, which ranged in price from $20 to $45, quickly sold out, online and in-store, where customers rushed the display. The limited-edition cups can now be found on eBay for around $100 or more. 

On Wednesday, Jan. 3, Target released another limited-edition Quencher, a 40-ounce model designed in partnership with Starbucks and featuring a “Winter Pink” hue.  With a price tag of $49.95, the cup was available only at Starbucks stores in Target locations. It was launched the same day as the coffee giant debuted its winter menu.

The Target-Starbucks cup release caused long lines, overnight camp-outs and even mayhem at several Target stores, reported Today.com, along with lots of buzz on TikTok. The platform showed videos of people waiting before dawn for their local Target to open, long with videos of disputes over alleged line-cutting and more. 

According to the report, the cups that were sold yesterday are already listed on sites such as Mercari, Poshmark and eBay for as much as $300. Target plans to release new Stanley items in its stores throughout 2024, including new colors, prints and brand crossovers.

Floor & Décor ended the year with a round of new store openings.

The specialty hard-surface flooring retailer unveiled seven new locations in December. The openings are in line with Floor & Décor’s plan to open a total of 32 stores in fiscal  2023.  The new locations include the company’s 11th outpost in the Dallas/Ft. Worth area, in Mansfield, Tex.

The other openings include: 

 •Port Chester, N.Y. (Floor & Décor’s 13th store in the New York City metropolitan area.

 •Springfield, N.J. (12^th store in New York City metro area)

• Shrewsbury, Mass. (7th store in the Boston area);

•Allentown, Pa. (6th store in the Philadelphia area);

•Manassas, Va. (7th store in the DMC metro area); and 

•Mobile, Ala. (4th store in Alabama).

Founded in 2000, Atlanta-based Floor & Decor operates more than 200 warehouse-format stores and five design studios across 36 states. Stores offer a wide in-stock selection of tile, natural wood, natural stone, laminate and luxury vinyl plank, along with free design services.

 In addition, the merchandise mix features tools, decorative materials, wall tile and related accessories for hard-surface flooring projects

In 2022, Floor & Decor’s net sales increased 24.2% to $4.264 billion from $3.433 billion in fiscal 2021. Comparable store sales increased 9.2%. Net income increased 5.3% to $298.2 million. Earnings per share were $2.78 compared to $2.64 in fiscal 2021.