Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from the line of Budd Bugatch representing Raymond James. Please proceed.
Chad Bolen - Raymond James
Good morning, Ralph, Steve and Jon. This is actually Chad filling in for Budd. A couple of questions. I know Steve, you mentioned in your comments that, it is pretty hard to quantify but, could you give us any help on kind of understanding how much business you walked away from due to the credit concerns, and in addition to that what do you think the year-over-year impact was of the absence of the licensee programs?
Steve Rolls
Yes, I will start by saying that I cannot give you those quantifications. In terms of business that we elected, I guess I would say not to take based on credit profiles. That is really hard to understand because you do not know what the orders might have been for those that became financially distressed and I do not mean, we just sort of turn our backs on retailers that are. Most retailers today across industries are having a tough time.
So we did not just turn our backs, we worked very carefully with our retailers but we were also careful to manage our risk in a very analytical way, so that we did not get out there and make decisions that we should not just based on sales because if you extend more and more credit in sales to people who are not going to make it, maybe it feels good in the short term, because you get sales but you do not collect on. So, we have really done a much better job there, but I say it is just really impossible to tell you how much that is, but you just know that there would have been higher sales and we have done that.
On the licensing side, we have talked in the past about, Ralph Lauren, as a big piece of business that, I will say, walked away from when the contract was up. We did talk to them about renewing and indicated we just could not renew on the same terms and conditions and so we in the end elected to part company there.
So that actually helps the bottom line, hurts the top line because we were losing money on those sales. So, that is an example of what that looks like and again we did not break that out and quantify it for there is more than just Ralph Lauren. And we will continue to do that when we license people's names or brands, if you will, to make sure that it makes sense for both parties.
- To read the full transcript on Seeking Alpha, click here »
