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Ascena’s Plus-Size Business in Limbo as New Entrants Elevate the Category

Ascena’s plus-size fashion group is facing rough waters, while new brands bring new ideas and elevated offerings to the curvy fashion customer.

When Ascena Retail Group reported disappointing second-quarter earnings results in March and said it was exploring options within its portfolio, early rumblings had the company’s plus-size business on the chopping block.

That’s because the plus-size business was the hardest hit in the quarter as it faced stiff competition from newer, hipper brands that sell in the direct-to consumer space or speak more authentically to the modern, and often millennial, customer. These are companies that don’t have the overhead of physical stores and, more importantly, their on-trend offerings are more in line with the younger consumer mindset.

Ascena’s plus fashion group comprising Lane Bryant and Catherines saw sales dip 10.2 percent, with comparable store sales down 8 percent. Ascena operates 747 Lane Bryant doors and 345 Catherines stores.

Ascena has since sold off a majority interest in its Maurices discount chain and decided to wind down its Dressbarn operation. According to a Bloomberg report Tuesday, Ascena is now turning its attention to opportunities that might be available for its embattled plus-size division.

So who might want a traditional retailer that has seen better days?

At the Evolving E summit in Manhattan Tuesday, co-hosted by GGV Capital and Max Ventures, Le Tote CEO Rakesh Tondon discussed who might want to buy “these old companies.”

Tondon said DTC brands stand to gain from these kinds of acquisitions—and he’s speaking from personal experience, as Le Tote, the clothing rental subscription service, acquired Lord & Taylor earlier this year for $100 million. The deal included the department store’s online operations and has provisions for taking over its existing store base. Tondon said Le Tote eventually plans to upsell its services at the department store, so consumers who walk through its doors can buy, rent and subscribe.

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According Tondon, more DTC brands are trying to scale, and acquisitions are one way to get there, both to get physical space quickly and to acquire new customers.

But the problems specific to legacy plus-size retailers like Lane Bryant and Catherines are only exacerbated by a crop of newcomers bringing a fresh point of view—and elevated price points—to a consumer who has long been starved for fashion.

The market gained a new entrant Tuesday with the launch of Ryllace from Cornerstone brands, part of the Qurate Retail Group. At Ryllace, customers can shop more than 150 products in sizes 14-24 across, dresses, tops, bottom, sleepwear, outwear and accessories ranging in price from $48-$368. The Solitude silk dress retails for $228 while travel-ready joggers retail for $98.

Ryllace focuses on premium fabrics including cashmere, linen, merino wool and mulberry silk, while certified organic cotton, Tencel Lyocell knit and micro-terry made from eucalyptus trees make an appearance in the inaugural collection—”demonstrating a commitment to make smart choices as much as possible,” the brand said in a statement.

According to Cornerstone brands president Claire Spofford, Ryllace was born from “a growing demand in the marketplace for high quality product with a focus on premium materials and versatility for the plus-size woman.”

“We put a lot of thought and care into developing this brand to ensure the fit is right, products feel and move like a dream, and every detail is considered for her,” Spofford said. “The result is a collection that will elevate her style so she can look and feel amazing.”

And another name new to the plus-size scene is Henning, the made-in-NYC startup helmed by longtime fashion editor Lauren Chan, who recounts on the brand’s website how “being plus-size has long made me feel on the fringes.”

Henning bowed this month during New York Fashion Week, offering 12 pieces in sizes 12-24, focused on elevated workwear essentials. The classic wool/viscose/lyocell-blend trench coat retails for $995, a green satin dress is offered for $495 and a pinstriped button-down cotton shirt goes for $249.

In a nod to modern attitudes to circularity, Henning also offers a $65 Henning X For Days T-shirt that automatically subscribes customers to membership in a closed loop T-shirt recycling and replenishment program. Henning partnered with For Days to expand the top of its size range from XXL to 4X specifically for its plus-size customers, according to brand’s website.

Though Ryllace and Henning are just two of the newest names in a plus-size apparel market where companies like Universal Standard have been innovating for the past four years, their elevated price points and quality materials represent a positive development in a sector long dominated by low-priced, lower quality fast fashion. And Henning’s foray into circularity is especially notable as the plus-size brand voice has been largely absent from fashion’s sustainability conversation.

Encumbered by legacy debts and investments, the changing plus-size landscape—and savvy younger consumer—is proving difficult for traditional retailers like Lane Bryant and Catherines to navigate. With the barrier to entry lower than ever for new businesses, market share in plus is up for grabs—and newcomers are all too eager to capture an under-served shopper ready to contribute to a market that garnered more than $20 billion in annual sales in 2016, per Statista.