Bebe’s Top Merchandising Executive to Leave

Women’s apparel retailer Bebe Stores Inc. said Tuesday that Greg Scott, vice president of merchandising, will leave the company at the end of this month.

Bebe shares fell $6.19 to close at $20.94 on Nasdaq in a broad market sell-off. However, the stock has dropped 42% in the last 12 months.

President Manny Mashouf will take over Scott’s responsibilities until a replacement is found. Bebe also named Suzanne Garcia to the new position of general merchandise manager. Garcia, who most recently worked for Nordstrom Inc., will report to Mashouf.

Blair Lambert, Bebe’s chief financial officer, said he had encouraged Scott, 36, to stay. But he said he was told Scott is moving to Los Angeles at the end of the month and does not have a job with another company. Scott could not be reached for comment.

“In the long run, the stock will take care of itself,” Lambert said. “[Scott] was a key player for the company, but as a good executive, I think he’s built a great team.”

Bebe, with about 108 stores and $201 million in sales last year, sells slim-fitting clothes and accessories for women ages 18 to 35. Scott helped shape the merchandise and advertising campaigns that gave Bebe its fashion edge, analysts said.

“People are concerned Scott was the creative force behind Bebe’s success and that with him gone, the company may lose its momentum,” said analyst Jeffrey Klinefelter of U.S. Bancorp Piper Jaffray.

Brisbane, Calif.-based Bebe has six months to 12 months before any impact on sales could become visible, Klinefelter said. Sales won’t probably be hurt, though, since Bebe still has “solid leadership” in Mashouf, who will oversee product development, he said.

Klinefelter said he expects Bebe’s stock to rise to about $40 a share in the next 12 months.

Bebe’s executive changes were probably not linked to company’s performance during the holiday season, analysts said. Bebe, along with most retailers, will report December same-store sales on Thursday.

“Their holiday season went fine,” said analyst Harry Ikenson at Chase H&Q.;

Ikenson expects Bebe’s to announce that December same-store sales rose 6% to 8%, slightly higher than the company’s own estimate.

Scott worked at Bebe for four years, and assisted Mashouf in developing the group that expanded the retailer’s assortment of tops, pants, accessories and logo clothing, said Lambert, the CFO.

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Bloomberg News was used in compiling this report.