Just an F.Y.I., but Trans World Entertainment operates F.Y.E. and a handful of other retail ventures. F.Y.E. (aka For Your Entertainment) stores sell CDs, DVDs, video games, software, and related products at about 440 locations throughout the US, Puerto Rico, and the Virgin Islands. Trans World's other bricks-and-mortar operations include about 20 video stores under the Saturday Matinee and Suncoast Motion Pictures banners. Most of the firm's retail outlets are located in shopping malls. Trans World also sells entertainment products via its e-commerce sites (including fye.com, secondspin.com, and wherehouse.com). Chairman and CEO Bob Higgins founded the company in 1972.
Trans World's sales have suffered along with the broader music industry as consumers increasingly prefer to download music rather than buy CDs. DVD sales have also been in decline as Internet streaming options become more accepted by consumers. In a bid to recoup revenues, the company launched a new pricing strategy at F.Y.E. in 2009: $14.99 and $12.99 for new CD releases from superstar artists, and $9.99 for older titles. Trans World also introduced the Backstage Pass loyalty card, which applies a 10% discount to customer purchases at F.Y.E. stores. In addition, Trans World stores have been tailoring their product selection to suit regional preferences, including shifting store space allotted for music to other categories. Still, the changes have not been able to turn around years of declining demand. Since fiscal 2007, the company's sales have fallen from a high point of nearly $1.5 billion to about $650 million in 2011.
Along with revamped pricing and product mix, Trans World has been paring down the size of its retail network to focus on a core group of profitable locations. The company closed about 100 stores during 2011 (offset by the purchase of five stores) and nearly 160 stores during 2010 (offset by two openings). Trans World has slashed its store count by more than half since 2007, when its operations peaked at about 990 locations. The closures have helped to narrow the retailer's losses to $30 million. Trans World has been in the red since 2008 because of high operations costs and impairment charges.
To further reduce expenses, Trans World shuttered its distribution center in Carson, California, in mid-2010. The move left Trans World with one distribution center in Albany, New York, which is leased from chairman and CEO Higgins. The New York distribution center handles about 70% of Trans World's inventory; the balance is delivered via direct shipments from vendors.
Higgins, who started the business as a wholesale music distributor, is Trans World's largest shareholder. He owns 46% of shares. – less