Check out Target maintaining retail margins.
 
That counts as a win in retail these days. The discounter was able to better manage markups and markdowns than last year, helping it keep gross margin steady, even though consumers are spending more on less profitable staples and less on discretionary items.
 
The company soundly beat analysts earnings estimates for the quarter. But profit still fell 13.3 percent in the quarter, not necessarily a good thing when you are in a proxy fight with an activist investor.
 
The story from Target was the same as the story from most retailers during this recession. Sales are sluggish or falling, they are controlling inventories and trying to rein in expenses.
 
AnnTaylor had the same story and reported a smaller-than-expected loss.
 
But it’s outlook was also cautious as the recession keeps women from buying work clothes and luxury apparel.
 
The question is, if consumers keep on the sidelines, how much more cost cutting can retailers do to limited the bleeding.
 
Also in the basket:
 
Tween brands posts narrower-than-expected Q1 loss
 
BJ’s Wholesale profit tops view; forecast raised
 
Sodas a tempting tax target (N.Y. Times)

(Reuters photo)

The financial crisis has hit sales of everything from cars to homes to lattes. Now women scared about the market, and maybe even their own jobs, are wearing the old standbys in their closets rather than splurging on new clothes for work. At least, that’s what’s happening over at AnnTaylor, which expects a bleak fourth quarter.
    
Ann Taylor, the company’s stores stocked with business and business casual clothing, is feeling the “significant impact the financial crisis is having on the professional working woman,” Chief Executive Kay Krill said during a conference call on Friday.
    
“Corporate headcount reductions and rising fears of future unemployment have made our client cut down or even cut out her spending all together,” Krill said.
 
Ann Taylor stores are seeing a “dramatic pull back” in items like suits and workplace separates, which represent about a third of the items in its stores.  Instead of buying a new suit, a shopper might just spruce up her wardrobe with a couple of tops. 
 
“I think it’s a different day and definitely she’s not interested in suits. I think that women want their wardrobe to work harder for them. They want it to be able to go to work and on the weekend and that’s what we’re seeing happening.”

Over at the more casual Ann Taylor LOFT stores (seen here) sweaters, dresses, denim and other casual items were the top sellers last quarter, while shoppers shyed away from “refined separates,” such as shoes, bags and jewelry.
 
One bright spot?  Cashmere, Krill said.  Apparently, when the going gets tough, women wrap themselves in a little bit of softness to cushion the blow.

(Reuters photo)

Listen up, fashionistas. Celebrity stylist Jorge Ramon wants women to know that wash and wear is the new rock and roll, when it comes to fashion trends.

That’s good news for every woman who’s ever skipped lunch just to pay her dry cleaning bill.

“In these economic times we’re in, with what’s going on, on Wall Street, women want to look good and save money. Finally, fashion is washable. It’s affordable, so you don’t have to spend money on dry cleaning,” Ramon told Reuters. He was presiding over a launch party for Tide Total Care detergent and Downy Total Care softener at the AnnTaylor Loft store in Times Square.

Ali Sharaf, an actress and Broadway caterer, was No. 1 in the line of the first 50 shoppers who scored a personal styling consultation with Ramon on Thursday morning. Her mission: Find the perfect LBD (little black dress) to wear to the opening night party for “Equus.”

About two-thirds of AnnTaylor Loft’s fall line is washable, said Ramon, who’s worked with such celebrities as singers Beyonce and Christina Aguilera, as well as with women selected for makeovers on TLC’s show “10 Years Younger.”

“I’m seeing more easy-care items” in stores and on runways, “and I just saw a menswear suit that’s completely washable,” Ramon said, describing the trend. “The idea is here. It’s the technological advances in fabrics and in clothing,” as well as in laundry products, that have made washable fashion more than just a slogan.

Silicone technology used by Procter & Gamble’s beauty division was adapted to create a detergent and softener that would fight the aging of fabrics and help keep their color and shape, Downy brand manager Marty Vanderstelt said.

“Silicone protects the fibers so there’s less friction as you move, put clothes on hangers or even in washing,” he said.

Chlorine neutralizers, often used in swimwear fabrics, were also added to cancel out the effects of chlorine in wash water and stop dyes from fading.

If only it could fold and iron, too.

(Video: Chad Ruble/Reuters)

AnnTaylor reported a quarterly loss on Friday as the struggling clothing retailer, facing lagging sales and falling store traffic, took a charge to restructure its operations. But not to worry — the CEO is aware of the problems facing the retailer and is “all over it.”

On a conference call with analysts, CEO Kay Krill reassured Wall Street analysts multiple times that the retailer was taking the proper steps to get business back on track.

Worried that AnnTaylor hasn’t realized its clients taste have evolved? Not to worry:

“Our clients’ product preferences have definitely evolved and we did not keep pace with her wants. She wants more modern and fashionable product that the is versatile and current, and we are all over that,” Krill said.

Anxious that AnnTaylor will make clothes at its namesake stores too trendy in an effort to drive sales?

“I don’t want any of you to think that we’re going off the deep end here. There is definitely a sand box that we’re playing in, we’re just going to go up more towards the edge of that sand box, so we’re all over it,” she said.

Skeptical that AnnTaylor can improve business at both its Ann Taylor and LOFT stores at the same time? Well, you can rest easy:

“It is absolutely my number one priority for 2008 and I’m all over it,” she said.

(Logo: Anntaylor.com Web site)