Chico's To Sell Brand Merchandise On Amazon

(RTTNews) - Shares of Chico's FAS, Inc. (CHS) rose 4 percent in pre-market activity Monday after the women's apparel retailer said that Chico's brand apparel and accessories will soon be available to purchase on Amazon.com Inc. (AMZN).

Chico's said that beginning in mid-May, shoppers will find a select assortment of Chico's brand merchandise on Amazon.com. This will include the brand's core collections - Travelers, Zenergy athleisure, no-iron shirts, So Slimming pants and Chico's jewelry.

The company added that more Chico's merchandise will likely be made available as the new business channel gains traction. This includes the potential to sell items from other Chico's brands like White House Black Market and Soma, in the future.

"Chico's FAS will be one of the few vertically-integrated specialty retailers with Prime eligibility on Amazon.com which is a testament to the strength of our iconic brands and their growth potential," Shelley Broader, CEO and President of Chico's FAS said.

All Chico's items purchased on Amazon.com will be eligible for Amazon Prime, free shipping, free returns and other benefits.

Chico's will maintain control of marketing, pricing and promotions for its products on Amazon. Given its early nature, Chico's does not expect this new sales channel to be material to its 2018 financial results.

In late February, Chico's said it expects a low single-digit decline in consolidated comparable sales for fiscal 2018, with comparable sales performance stronger in the second half of the year compared to the first half.

At that time, Chico's also reported a year-over-year increase in profit for the fourth quarter despite a 2.2 percent decline in net sales. Comparable sales for the quarter decreased 5.2 percent.

On its part, Amazon has been trying to lure established clothing brands to its website. In June, 2017, sportswear giant Nike confirmed it is starting a pilot program to sell some items directly through Amazon.com.

With a direct partnership with Amazon, Nike said it expects to gain more control over how its products are marketed on the site and to fight the distribution of counterfeit items.