Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 ISOLATE SEGMENTS: INDIVIDUAL CUSTOMER SEGMENT

CHOICE 3 COMPONENT: PROVIDE A MEET OR RELEASE AGREEMENT

No. SIC Year Notes
1 6519 2009 Retail chains are using the fine print in their leases to demand rent reductions, eking out critical savings and pressuring mall owners already struggling with vacancies. Charming Shoppes Inc., with brands such as Lane Bryant and Fashion Bug, estimates that it will save roughly $10 million this year by pursuing rent relief, including the use of cotenancy clauses. The breach of a cotenancy clause typically allows the retailer to pay as little as half the rent while the landlord searches for a new tenant to replace the one that departed. If none is found within the allowed grace period of a year or more, the retailer can break its lease without the usual, hefty cancellation fee.

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