Hanesbrands Inc. F3Q09 (Qtr End 10/03/09) Earnings Call Transcript

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2009-10-28 17:54:09.0

Tags: Supply Chain, Brand, Retail Company, Call Transcript, Earnings, Credit Suisse Group AG, Hanesbrands Inc., Sales Strategy, Supply Chain Management (SCM), Branding, Retail, Sales Force Management, Sales, Enterprise Software, Software, Marketing, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Omar Saad - Credit Suisse.

Omar Saad - Credit Suisse

I kind of wanted to start with the commentary you have made around the sales guidance for next year and some of the things that are happening, it sounds like, that drove your ability to put out that plus-5 number. Help me understand, we knew about the Just My Size and that win out there, but can you point to some underlying fundamental things that are happening, either at the retail level, or from a competitive standpoint, what's really driving from an underlying basis, this meaningful shift in what could be underlying sales trends?

Richard A. Noll

I think when you're talking about this kind of increase and it's so broad-based across many different accounts from department stores through dollar stores and across most of our brands, it's really a reflection of the investments that we've been making in our brands over the last three years. Retailers are seeing that they can use our brands to drive traffic to their store and help them drive both their sales and profits. And I think that's the fundamental reason for a lot of these gains.

Additionally, I don't want to also lose sight of this fact that while we are number one or number two in all of our categories, we've still got a lot of distribution voids out there to gain share. And we are going to aggressively go after it.

I think one of the prerequisites was we needed to have a low-cost global supply chain in place from which to competively go after this share. We now have that. And so you think of this as a new phase, this optimize it and leverage this supply chain and it's all about driving the top-line and leveraging that supply chain to the best that we can.

Omar Saad - Credit Suisse

Is there a shift in the way retailers are thinking about their different suppliers that is triggering this now? What is different today versus a year ago? Is it really just a completion of a large chunk of the supply chain restructuring.

Richard A. Noll

I think it's a couple of things. One is that our brand equities continue to build over time. Two, during the recession, what a lot of retailers were gravitating to, was driving well-known national brands with broad appeal to bring people in their stores, because well, their number one issue is traffic, right?

 

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