Men’s Wearhouse shares are crashing after the company said Jos. A. Bank’s decision to scale back on its outrageous discounts hit foot traffic and sales.
The retailer held one final “buy-one, get-three-free” sale in October, announcing that the current strategy was unsustainable.
“During the third quarter comparable sales decreased 14.6% at Jos. A. Bank, far below the Company’s earlier expectations,” Men’s Wearhouse said in a statement. “This decrease was primarily driven by a decline in traffic as the Company began the transition away from the buy-one-get-three promotional events.”
The company also slashed its forecast for earnings, saying adjusted earnings per share will be in the range of $US0.46 to $US0.51, down from an earlier target of $US0.87.
The shares are down 21% in after hours trading.
Deals on men’s suits, sport coats, sweaters, and more helped make Jos. A Bank a household name.
But Men’s Wearhouse, which acquired Jos. A Bank last year, recently began phasing out the promotions, saying they were no longer sustainable.
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