Summary
PacSun needs to focus it's organization as well as it's capital. PacSun needs to grow comp stores and it is a must that they expand the brands lifestyle vs go after a business that was not working well when Urban was strong.
Analysis
This will be a big hit for the Urban vendor community, they will lose volume, most of the volume will not shift to other retailers, however, Man Alive Stores may find a window of opportunity in some markets to pickup some strong locations and or new markets.
PacSun neeeds to continue it's efforts in growing their female business which I would guess is the key to their comp growth. They should also look at the opportunities for some locations to expand PacSun space to max the growth of womens business (ie loungewear). The sooner PacSun decides to close down the sooner they can limit the markdown cost of closing, we are going into the best time of the year to limit the margin hit.
