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How Burlington Stores Is Gearing Up for Further Growth


Dec. 4 2020, Updated 10:52 a.m. ET

Store expansion plans

Burlington Stores (BURL) posted strong results in 1Q16, which ended on April 30, 2016. The off-price retailer is now aiming for a further expansion of its store network. In 1Q16, the company opened six new stores under the Burlington Stores brand. The retailer closed two MJM Stores and one Burlington Store in 1Q16. The company plans to open about 25 net new Burlington Stores in fiscal 2016, which ends on January 28, 2017.

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Growth opportunities

As at the end of 1Q16, Burlington Stores operated 570 retail stores, including an Internet store. At the end of the comparable first quarter, TJX Companies (TJX) operated 2,715 stores in the United States, 399 stores in Canada, 512 stores in Europe, and 35 stores in Australia. Ross Stores (ROST) operated 1,295 Ross Dress for Less locations and 178 DD’s Discounts stores in the United States as at the end of 1Q16. Nordstrom (JWN) operated 200 off-price Rack stores in the United States at the end of 1Q16.

Burlington Stores has a smaller presence than TJX Companies and Ross Stores. The company can capture further growth opportunities in the off-price space as more consumers continue to look for bargain deals.

Merchandise enhancement

Burlington Stores is focusing on enhancing its merchandise areas with an increased focus on home, beauty, and ladies’ apparel.

Burlington Stores constitutes 0.2% of the iShares U.S. Consumer Services ETF (IYC).

In the 1Q16 conference call, Thomas Kingsbury—Burlington Stores’ chairman and CEO—stated that the home category remains the biggest merchandising opportunity for the company. To enhance its home business, Burlington Stores has been building its vendor base, adding more nationally recognized brands, providing more assortment choices, and investing in improved store presentations.

Burlington Stores is also focusing on growing its beauty business. To improve its beauty business, the company is looking to increase its vendor base, add more identifiable brands, improve the quality of its products, and enhance its in-store presentation. The company also sees growth opportunity in the ladies’ apparel category. The company has added a sixth divisional merchandise manager to strengthen its leadership oversight in ladies’ apparel. Burlington Stores is focusing on special sizes and maternity under the ladies apparel category.

The next part of this series discusses analyst recommendations for Burlington Stores.


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