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Chico’s Joins Ranks Of Amazon Sellers: Will It Be Worth It?

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The question of whether to compete against or work with Amazon has been debated by many in retail, and it appears the e-Commerce giant has won the argument with another retailer. Chico’s FAS revealed that it will sell Chico’s merchandise on Amazon starting in mid-May.

Chico’s will keep control of marketing, pricing and promotions for its products under the new partnership, but all items purchased on Amazon.com will be eligible for Amazon Prime, free shipping and returns.

The product assortment includes the brand’s core collections – Travelers, Zenergy athleisure, no-iron shirts, So Slimming pants and jewelry. Chico’s could begin selling merchandise on Amazon from its other retailers, White House Black Market and Soma, “as the new business channel gains traction,” according to a statement.

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Chico’s is the latest I n a series of major retail names that already sell to consumers through Amazon. Sears started selling Alexa-powered Kenmore home appliances on Amazon last summer, and later brought its DieHard-branded products to the e-Commerce site. Nike opened a storefront on the site last year as well, joining competitors Under Armour and Adidas, while Calvin Klein offered exclusive merchandise on the site in conjunction with a pop-up store campaign. The Children’s Place began selling its products on Amazon as early as 2014.

While the Sears example is likely more of a last-ditch effort to capitalize on a popular sales channel, the other cases are rooted in these brands’ need to take back market share from third parties selling their merchandise — or even counterfeited merchandise — at lower prices.

Chico’s operates 1,460 stores in the U.S. and Canada, but saw same-store sales fall 5.2% during Q4. The move to Amazon is certainly bound to have its detractors, especially since Amazon already is making its own private label push into apparel.

In a RetailWire discussion, Neil Saunders, Managing Director of GlobalData, pointed out that while Amazon can be beneficial in increasing exposure and sales, Chico’s still has two dangers to contend with:

“First, this helps strengthen Amazon and, ultimately, its own ambitions in apparel — which are mostly around its own-labels,” said Saunders. “Second, it has the potential to cannibalize sales from Chico’s own stores. This is especially so as, in my view, most of Chico’s stores do not add all that much value to the shopping experience. Each retailer is unique but, in Chico’s case, I see this as a matter of short-term gain for long-term pain.”

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