Sunday, April 3, 2016

Company profile: Five Below (FIVE)

Consumer cyclicals underperform in a weaker economy as consumers delay non-essential purchases. Dollar stores, however, have fared well compared with the rest of the industry in the past decade, as incomes stagnated for most Americans amid an economic crisis and sluggish recovery.

Budget retailers:  TJX Cos. (TJX), Ross Store (ROST), Five Below (FIVE).

Five Below
  • Five Below was founded by David Schlessinger, creator and founder of Encore Books and Zany Brainy, along with Tom Vellios, former CEO of Zany Brainy. 
  • Targeting teen and pre-teen shoppers, Five Below offers everything from headphones to Sour Patch candies, flip flops, water guns and nail polish.
  • Five Below says its target market is the 60 million Americans aged 5 to 19, who are estimated to account for at least $250 billion in annual spending.
  • As its name suggests, at a Five Below outlet all items are priced under $5.
  • The company's quickly revolving merchandise is intended to draw in repeat customers, helping it book 25 straight quarters of same-store sales growth.
  • Five Below opened its first store in Wayne, Pennsylvania in October 2002. It currently has more than 430 stores and is primarily located in the eastern part of the country in 27 states. It expects to cut the ribbon on approximately 85 new stores and enter four new states in 2016
  • Analysts say the chain can ultimately support over 2,000 stores, and that distribution centers already opened can handle 500 to 600 stores.
  • Five Below can open a new store with only $300,000 in cash up front, and earn that back in just 10 months, according to Jeremy Hamblin, an analyst for the investment bank Dougherty & Company.
  • The retailer had a public offering at $17 a share last July 2012.
  • HQ: Philadelphia, PA 19103, United States

Current store locations

©Artremis / Eva Sawicka (4/16)

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