Forum Topics CCX CCX Investigating CCX

Pinned straw:

Added 12 months ago

At PortfolioPlus Scoonie found your analysis of City Chic (ASX:CCX ) the “Plus Size” women’s clothing chain, intriguing. I was particularly impressed by your seeking first-hand customer knowledge by unobtrusively hanging around your local Gold Coast City Chic store to observe store patronage. Modestly described by yourself as undertaking:  “shabby amateur detective work."  Well done.

An hour or so observing foot traffic is a great way to gain a first hand understanding of a retail business.   Retail is one of the few businesses where an ordinary investor you can quickly get some sort of a feel for the business just by visiting a store. Years ago, I bought into JB Hi Fi on the same basis. Being impressed after visiting a local store where I observed it packed with young people along with energetic and helpful staff.

So Scoonie also went to the local City Chic outlet (described by City Chic as a “World of Curves”) at Westfield Kotara and did some of my own investigation. Similar to PortfolioPlus I waited at a non-suspicious distance outside and just watched.  

For the 30 minutes I was outside, I observed the following:

  • 3 women walked into the store,
  • Only one appeared to be a buyer, leaving with a bulging paper bag.

I very rarely go to shopping centers and like PortfolioPlus I too was stunned by the observed size of the potential market -  what CCX management call the larger ‘she’.

Dissatisfied with the usefulness of the above detective work, I decided to enter the store under the pretext of intending to buy a Christmas dress for my wife. The idea being, in the process I would engage the staff member with questions on store performance, staff turnover and all things business. This was a big step for Scoonie.  Firstly I have never been in a dress shop before in my life, and secondly my wife is a svelte size 10.  I reasoned to myself: if a wily Plus saleslady did somehow corner me into making a purchase, then I could have someone cut down the plus-sized dress and with the material make three (or perhaps more) normal sized garments. So all would not be lost.

As I waited a distance outside the City Chic outlet, the very thought of the deception I was planning was making me nauseous. The feeling was something like the time as a thirteen year old Scoonie used to pretend to look at the car magazines at the local newsagent. Instead my tiny retina muscles were straining to the side, ogling the front covers of the adjacent magazines in their little plastic bags. Fortunately at the time the whole situation was so stressful my other tiny muscle did not also become strained, so saving me any further embarrassment.  

After a break in the shopping mall foot traffic and wearing a baseball cap and heavy-set reading glasses I quickly darted into the store.  What confronted me was so many tent dresses it could have been the Port Macquarie caravan park at Easter.  Row after billowing row of them. A Plus sized shop assistant with a Plus sized smile approached me and asked if she could help. I felt extremely embarrassed. I was just rooted on the spot. I couldn’t get any words out. It was like being back in high school, trying to build up the courage to phone the hot chick and ask her out. And I did, and when she picked up the phone I just hung up. Or like the time I arrived at school with my fly down, and for once the hot chicks took notice of me - only this time they were all laughing at me. Or at least a part of me. 

The Plus lady was now directly in front of me, smiling. What could I do but just pretended to smile back. And then pretend my phone was ringing and put it up to high on my head to cover as much of my red and throbbing face as I could.  Then for real put my head down. Then for real ran as fast as I could out of the shop. School Chicks or City Chics it only proves my life-long interactions with females are a complete cluster.   

I am back home now, and when this morning I went to get the mail one of the neighbours looked at me a little strange and didn’t say anything. I know she works at the local Westfield. Instead of me investigating the local City Chic “World of Curves” for serious business intent, maybe now I am being investigated as some sort of a sick lead actor in a “World of Pervs”.

With my wife working and I having no visible means of support and being a naturally introverted and quiet sort of fellow I am already something of a Village Oddity. And after what just happened I risk being becoming known as the Village Weirdo. Myself, I would be content with just being known as an ordinary every- day Village Idiot.  

Andrew can you please start up some kind of a Strawman Roster of members to undertake these real life investigations?  To kind-of equitably spread around the psychological punishment. I don’t think at my age, and my now fragile mental condition I can handle another humiliation like this one. 

NewbieHK
Added 12 months ago

@Scoonie I can definitely see you opening for Carl Baron.

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Arizona
Added 12 months ago

@Scoonie You paint a vivid picture.

Thanks for the insights and the report

and be grateful that Adultshop.com is no longer listed on the ASX - that may have been your next asignment.


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Noddy74
Added 12 months ago

Love it @Scoonie Well done to you sir, and if we were doing an end of year Hall of Fame (not the worst idea) that would make my short list.

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UlladullaDave
Added 12 months ago

Very funny! I did LOL. Haha.

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Rick
Added 12 months ago

@Scoonie haha! I hope your wife doesn’t find out you’ve been Christmas shopping for her at City Chic! You might just find out another meaning for ‘sick’! I like doing this type of research while I wait for my wife at shopping centres. In fact I’m waiting for my wife right now at Pacific Fair Gold Coast. I might go and check out Lovisa and the Universal Store. I might just steer clear of City Chic at the risk I will look like a weirdo too! :)

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Slomo
Added 12 months ago

The first is the worst @Scoonie!

Well played going deep into enemy territory and taking one for the team.

When your battle sickness finally passes you will likely be left with a lingering lust for more frontline action.

I'd be keen to get your thoughts on Lovisa, next time you're on the lurk in the vicinity of one.

Godspeed.

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PortfolioPlus
Added 12 months ago

Excellent article @Scoonie and certainly a damn good memory of one’s early teenage trips to the newsagents, chemists & bottleshop.

Lurking and loitering are the penalties one must contemplate in uncovering first hand investment information. But maybe we must just be hidden in plain sight. Here’s a Temu disguise I am contemplating (see below, but I might get a blow wave and a purple perm to round it off)

and I’ve worked out my dialogue - as in ‘I’m looking for a slinky little off the shoulders number - in vermillion - for my wife” no way will they have that hanging off the tent rack.

Seriously ( and this is filler so we don’t get an Andrew Strawman red or yellow card) - I did ask questions after disclosing I was a shareholder interested in the impact of Black Friday - and I got what I wanted - things are picking up)

also interesting that the CCX Chair opened his moth infested wallet and bought $71k in shares yesterday. And then today another director lashed out $5k to show he is committed….well, that’s what he wants us to think!

4bca880da08377dd5ac51f18e3a87cea058c82.png

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mikebrisy
Added 12 months ago

@Scoonie Your post had me in fits!

I don't have your level of courage, and instead commission my wife and daughter to do the front-line research in our local $LOV outlets. (They are both beneficiaries of our ASX fund, so it's only fair.) While I am very happy to tour DJs and Myer looking at the product positioning and competion for the $BRG range. And I will even swing by the $NCK store near the Brisbane DFO complex. And I've chalked up half a dozen visits to pharmacies over recent months to view the $BIO product placement, and whether the staff education appears effective. As for $JBH, I'm always dazzled by how packed the shops are, how knowledgeable and motivated the staff are, and how furiously the payment desk is processing purchases. But its never worked for me on valuation, in the two years I've been looking (wrong again).

However, one thing I have learned recently - to my own misfortune - is that while these site visits can be valuable, you have to allow for the fact that retail flows are very lumpy. Specifically, multiple observations of totally empty stores (save for two sales assistants) at our nearest Adairs at Carindale in Brisbane a year or two ago, probably incorrectly biased my reading of results that they weren't navigating the retail slowdown well. I think the facts haven't bourne that out at all. I exited early and took an unnecessarily large capital loss partly as a result.

Good luck to all exploring the $CCX turnaround.... I liked @PortfolioPlus description of the turnaround thesis. If this one turns, there is a very large upside from here over a 2-3 year horizon I reckon. No question - the "dressible market" hasn't gone away.

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Noddy74
Added 12 months ago

Btw @PortfolioPlus it was a cracking original post to initiate the convo. My ongoing issue is prob similar to what you implied - to what extent do u discount given much of previous management is still in place. They’re saying what I want to hear as a shareholder, but don’t think I can invest until I see them deliver 2hat I want as a customer (by which time I doubt they’d be cheap enough!)

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Solvetheriddle
Added 12 months ago

@Slomo @Scoonie an ex colleague that i respect, said he was having a close look at CCX as a turnaround, he is a value small cap PM now. so maybe worth keeping an eye on

Ryan, regarding LOV, I went into my first Harli and Harpi (or whatever) store in Bankstown Square last week. I thought it looked great. There was a bit of traffic, but it was full of inventory and a huge range. There was a lot of gold, even the walls and decor were all gold. I don't know if that became too much and doesn't age well. i also felt that SF was not into the international bit of LOV when CEO, so be interesting to see how they develop. There will likely be pressure on the home base, we shall see, LOV is a US/European story now imo. to be clear i am no expert on female fast fashion

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Slomo
Added 12 months ago

@Solvetheriddle, very good - Harli and Harpi - love it!

Agree LOV is a US & Euro roll out story - that's my thesis anyway. The established AUS network and model is being parlayed into OS expansion - internally funded growth capex.

I like the narrative about the harpies being a competitive threat as it may throw up some better prices to add more LOV.

But I think they have a long way to go before they dent the LOV machine.

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Rick
Added 12 months ago

On yet another rainy day on one of the busiest days I’ve ever seen at Toowoomba Grand Central here is a snap shot of the activity inside at city chic collective:

b330cf87babe7ca3be216d9006018d9affaf0b.png

Photo 3pm 18/12/2024

Not a soul in sight!

and up one level in Lovisa’s shoebox sized store:

45ff3a2623c1c3a65ade5743946d9a86886be9.png

I think the secret is in the free piecing. It captures that cohort for life, and not just young girls! That’s been the case for my lovely granddaughters! And guess who bought their first set of quality gold earrings from Lovisa….the Grandparents of course!

Lovisa held IRL.

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Solvetheriddle
Added 12 months ago

@Rick well done, maybe big ladies don't like going out in the wet! is there a Harli and Harpi store there yet? don't know if H&H does piercings, i suppose they could easily add it if it is an issue.

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Rick
Added 12 months ago

@Solvetheriddle Perhaps! However, I did see a potential customer walk in about 5mins later. I good time to leave before I blew my cover!

I will need to check if we have an H&H store for the next visit!

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