Disney Stores Run Better By Others

Joseph Menn of the Los Angeles Times reports that Children’s Place does a better job of running the Disney Stores than Disney did – at least financially.

Synergy with Disney’s entertainment operations was always the goal, dating back to when the stores opened under former Chief Executive Michael Eisner. But shoppers were eventually turned off when the stores shilled merchandise from poorly received movies.

"There was a heavy reliance on having synergy programs on at times of the year when it didn’t match a traditional retail calendar," said consultant Peter Whitford, who ran the stores from 2001 to 2003.

Disney also stocked the shelves with high-priced and high-margin items, suffered from weak management and expanded too much, to more than 700 shops worldwide. It still owns Disney Stores in Europe.

"They opened so many of them that they each ceased to be special, and then you’re just another retailer — which is a very tough business to run profitably," said Marty Brochstein, who edits the Licensing Letter.

I tend to favor control by The Walt Disney Company by developing and operating internally, but I can’t argue with the facts.  If someone else is able to do it better and Disney can still profit without hurting the name, go for it.  Look at Japan, for example.  Maybe Children’s Place can buy The Gap and help them out?  They’ve been having some trouble, and there are people there who have Disney Store experience (heh heh heh).

What kind of experiences have you had at the stores?

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