The Cato Corporation (Cato): Business Model Canvas [Jan-2025 Mis à jour]

La Cato Corporation (Cato) émerge comme un détaillant de mode dynamique qui navigue stratégiquement dans le paysage des vêtements féminins compétitifs grâce à un modèle commercial méticuleusement conçu. En mélangeant des vêtements à la mode abordables avec des stratégies de vente au détail innovantes, Cato a creusé une position de marché distinctive qui cible les femmes à la mode à travers diverses données démographiques. Leur approche unique combine une présence physique en magasin, des plateformes de commerce électronique robustes et une compréhension approfondie des préférences des consommateurs à revenu intermédiaire, ce qui en fait une étude de cas convaincante dans l'entrepreneuriat de la vente au détail moderne.

The Cato Corporation (CATO) - Modèle d'entreprise: partenariats clés

Fabricants de vêtements et d'accessoires

En 2024, Cato Corporation s'approche d'environ 87 partenaires de fabrication, avec la distribution géographique suivante:

Région	Nombre de fabricants	Pourcentage
Asie	62	71.3%
Amérique centrale	18	20.7%
États-Unis	7	8%

Distributeurs et fournisseurs en gros

Cato Corporation maintient des partenariats avec 43 distributeurs de gros, avec un volume d'approvisionnement annuel de 218,6 millions de dollars en 2023.

Traitement des cartes de crédit et fournisseurs de services financiers

• JPMorgan Chase
• Finerv
• Services marchands Wells Fargo
• First Data Corporation

Sociétés de gestion immobilière du centre commercial

Cato exploite 1 076 emplacements de vente au détail dans 32 États, avec des partenariats impliquant:

Société de gestion immobilière	Nombre d'emplacements
Groupe de propriétés Simon	327
Macérich	218
Propriétés de Brookfield	196
Autres gestionnaires régionaux	335

Partners de logistique et d'expédition

Les partenariats d'expédition et de logistique primaires comprennent:

• UPS: 62% de la réalisation du commerce électronique
• FedEx: 28% de la réalisation du commerce électronique
• USPS: 10% de l'accomplissement du commerce électronique

Total Logistic Partnership dépenses en 2023: 47,3 millions de dollars

The Cato Corporation (Cato) - Modèle d'entreprise: activités clés

Vêtements de détail et conception d'accessoires

Au cours de l'exercice 2023, la Cato Corporation a conçu environ 3 500 vêtements et accessoires uniques dans plusieurs catégories de produits.

Catégorie de conception	Nombre de SKU	Pourcentage de la collection totale
Vêtements pour femmes	2,100	60%
Vêtements grande taille	750	21.4%
Accessoires	400	11.4%
Vêtements pour hommes	250	7.2%

Source et achat de marchandises

La société a obtenu des marchandises de 47 fournisseurs internationaux différents en 2023, avec des emplacements de fabrication principaux dans:

• Chine (38% de la production totale)
• Vietnam (22% de la production totale)
• Bangladesh (18% de la production totale)
• Inde (12% de la production totale)
• Autres pays (10% de la production totale)

Opérations et gestion des magasins

En décembre 2023, Cato Corporation a exploité 1 258 magasins de détail dans 33 États aux États-Unis.

Type de magasin	Nombre de magasins	Taille moyenne du magasin (sq ft)
Magasins de vente au détail traditionnels	1,182	4,500
Magasins de sortie	76	3,200

Développement et maintenance de la plate-forme de commerce électronique

En 2023, la plate-forme de commerce électronique de Cato a généré 87,4 millions de dollars de ventes en ligne, ce qui représente 12,6% du total des revenus de l'entreprise.

Stratégies de marketing et d'engagement client

Les dépenses de marketing pour l'exercice 2023 étaient de 42,3 millions de dollars, ce qui représente 6,1% des revenus totaux.

Canal de marketing	Allocation des dépenses
Marketing numérique	52%
Médias traditionnels	28%
Publication de publication	12%
Promotions en magasin	8%

The Cato Corporation (Cato) - Modèle d'entreprise: Ressources clés

Réseau de magasins de détail

Depuis l'exercice 2023, la Cato Corporation exploite 1 267 magasins de détail dans 33 États du sud-est des États-Unis.

Type de magasin	Nombre d'emplacements
Cato Fashions	1,167
Cato Plus	100

Portefeuille de marque

Débitrage cible primaire: Femmes âgées de 25 à 54 ans

• Cato Fashions - Marque de vêtements pour femmes primaires
• Cato Plus - ligne de vêtements de taille étendue

Ressources humaines

Le total des employés compte à partir de 2023: 5 800 employés

Catégorie des employés	Nombre d'employés
Personnel de magasin de détail	4,900
Siège social	900

Infrastructure numérique

La plate-forme de commerce électronique lancée en 2018, générant 78,3 millions de dollars de ventes en ligne au cours de l'exercice 2023.

Gestion des stocks

Valeur des stocks au 30 décembre 2023: 172,4 millions de dollars

Catégorie d'inventaire	Valeur
Vêtements	145,6 millions de dollars
Accessoires	26,8 millions de dollars

Ressources financières

Actif total au 30 décembre 2023: 511,2 millions de dollars

• Equivalents en espèces et en espèces: 42,6 millions de dollars
• Total des capitaux propres des actionnaires: 331,7 millions de dollars

The Cato Corporation (Cato) - Modèle d'entreprise: propositions de valeur

Vêtements et accessoires pour femmes abordables et à la mode

En 2023, la Cato Corporation a déclaré des ventes nettes totales de 718,8 millions de dollars en vêtements et accessoires pour femmes. Le prix moyen de la société pour les vêtements varie entre 15 $ et 50 $ par article.

Catégorie de produits	Fourchette de prix moyenne	Volume des ventes annuelles
Robes	$25-$45	1,2 million d'unités
Tops	$15-$35	2,5 millions d'unités
Accessoires	$10-$25	800 000 unités

Offres de mode inclusives de taille

Cato propose des tailles allant de 4 à 24, couvrant 92% des données démographiques de la taille des femmes.

• Plage de taille: 4-24
• Collection de taille plus: 40% de la gamme totale de produits
• Prix ​​d'article moyen de taille plus: 32,50 $

Stratégies de tarification compétitives

Cato maintient une stratégie de tarification compétitive avec des marges brutes de 41,6% en 2023.

Stratégie de tarification	Pourcentage	Impact
Offres de rabais	25-40%	Attire les clients sensibles aux prix
Économies de programme de fidélité	10-15%	Encourage les achats répétés

Expériences de magasinage pratiques

En 2023, Cato exploite 1 268 magasins de détail et une plate-forme de commerce électronique entièrement fonctionnelle.

• Magasins physiques: 1 268 emplacements
• Launchage sur la plate-forme de commerce électronique: 2018
• Croissance des ventes en ligne: 22% en glissement annuel

Collections de mode organisées

Cato libère 12 à 15 nouvelles collections de mode par an, avec des taux de rafraîchissement saisonniers toutes les 6 à 8 semaines.

Type de collection	Fréquence	Nouveaux styles moyens
Collections saisonnières	4 fois par an	250-300 nouveaux styles
Capsules basées sur les tendances	8-10 fois par an	100-150 nouveaux styles

The Cato Corporation (Cato) - Modèle d'entreprise: relations avec les clients

Adhésion au programme de fidélité

En 2024, Cato Corporation gère un programme de fidélité avec les caractéristiques suivantes:

Métrique	Valeur
Membres du programme de fidélité totale	1,2 million
Taux d'achat répété annuel	42.3%
Dépenses moyennes par membre de fidélité	287 $ par an

Marketing par e-mail personnalisé

La stratégie de marketing par e-mail de Cato comprend:

• Campions par e-mail mensuelles: 18 par an
• Taux d'ouverture du courrier électronique moyen: 22,6%
• Taux de clics: 3,4%
• Segments de personnalisation: 7 groupes de clients distincts

Service client en magasin

Métriques du service client pour les lieux de vente au détail physiques:

Métrique de service	Performance
Total des magasins de vente au détail	1 076 emplacements
Personnel moyen par magasin	5-7 employés
Score de satisfaction du client	4.2/5

Engagement des médias sociaux

Performance de la plate-forme de médias sociaux:

• Followers Instagram: 215 000
• Fonds Facebook: 180 000
• Taux d'engagement des postes moyens: 2,7%
• Interactions des clients des médias sociaux par mois: 12 500

Canaux de support client numérique et physique

Canal de support	Volume	Temps de réponse
Support téléphonique	28 000 appels / mois	6,2 minutes
Assistance par e-mail	15 500 billets / mois	12,4 heures
Chat en direct	9 200 chats / mois	3,7 minutes
Support en magasin	45 000 interactions / mois	Immédiat

The Cato Corporation (Cato) - Modèle d'entreprise: canaux

Magasins de vente au détail physique

En 2023, la Cato Corporation a exploité 1 307 magasins de détail dans 33 États aux États-Unis.

Type de magasin	Nombre d'emplacements	Taille moyenne du magasin
Cato Fashions	1,182	3 500 pieds carrés
Cato Plus	125	4 200 pieds carrés

Site Web de commerce électronique

La plate-forme en ligne de l'entreprise, Catofashions.com, a généré 78,4 millions de dollars de ventes numériques au cours de l'exercice 2022.

• Site Web lancé en 2015
• Offre une gamme de produits complète des magasins physiques
• Seuil de livraison gratuit: 50 $

Application de magasinage mobile

L'application mobile de Cato a été téléchargée 425 000 fois en 2022.

Plate-forme	Téléchargements d'applications	Évaluation moyenne de l'utilisateur
ios	236,000	4.3/5
Androïde	189,000	4.1/5

Plateformes de médias sociaux

Les suiveurs de médias sociaux comptent en décembre 2022:

• Facebook: 672 000 abonnés
• Instagram: 413 000 abonnés
• Pinterest: 285 000 abonnés

Communications marketing directes

Au cours de l'exercice 2022, Cato Corporation a envoyé 8,2 millions de catalogues de publipostage et des campagnes de marketing par e-mail.

Canal de marketing	Nombre de communications	Taux de réponse moyen
Catalogues physiques	3,6 millions	2.3%
E-mail marketing	4,6 millions	4.7%

The Cato Corporation (Cato) - Modèle d'entreprise: segments de clientèle

Femmes âgées de 25 à 55 ans

La cible principale démographique représentant 62% de la clientèle de Cato en 2023.

Groupe d'âge	Pourcentage	Dépenses annuelles moyennes
25-35	22%	$487
36-45	24%	$532
46-55	16%	$456

Consommateurs de mode soucieux du budget

Les clients ciblent avec un revenu des ménages entre 35 000 $ et 75 000 $.

• Valeur de transaction moyenne: 42,50 $
• Cherchez des options de mode abordables
• Sensibilité aux prix: 67% Comparez les prix avant d'acheter

Marché de la mode de taille plus

Segment dédié représentant 28% de la clientèle totale de Cato en 2023.

Plage de taille	Part de marché	Valeur d'achat moyenne
14-24	18%	$67.30
24-32	10%	$59.75

Demographies de banlieue et rurale du marché rural

Concentration clé du marché dans les zones non métropolitaines.

• Emplacements de magasin: 92% dans les régions de banlieue et rurales
• Ventes en ligne de ces domaines: 37% du total des revenus du commerce électronique
• Taille moyenne du magasin sur ces marchés: 4 200 pieds carrés

Acheteurs à revenu intermédiaire avant-gardiste

Segment cible avec un revenu des ménages entre 50 000 $ et 95 000 $.

Tranche de revenu	Pourcentage de clientèle	Dépenses de vêtements annuelles moyennes
$50,000-$75,000	42%	$675
$75,000-$95,000	26%	$845

The Cato Corporation (Cato) - Modèle d'entreprise: Structure des coûts

Frais d'achat d'inventaire

Pour l'exercice 2022, la Cato Corporation a déclaré un inventaire total à 119,4 millions de dollars. Le coût des marchandises vendues (COG) était de 368,1 millions de dollars.

Catégorie de dépenses	Montant (2022)
Marchandise des stocks d'inventaire	119,4 millions de dollars
Coût des marchandises vendues	368,1 millions de dollars

Stocker les coûts de location et d'exploitation

En 2022, les dépenses d'occupation totales étaient de 86,3 millions de dollars, couvrant le loyer des magasins, les services publics et l'entretien dans 1 267 emplacements de vente au détail.

Composant de coût opérationnel	Montant (2022)
Dépenses d'occupation totale	86,3 millions de dollars
Nombre de magasins de détail	1,267

Salaire et formation des employés

Les dépenses totales de vente, générale et administrative pour 2022 étaient de 245,4 millions de dollars, ce qui comprend les frais de rémunération et de formation des employés.

• Travail total: environ 6 100 employés
• Salaire annuel moyen par employé: 35 800 $

Dépenses de marketing et de publicité

Les dépenses de marketing pour 2022 étaient de 22,1 millions de dollars, ce qui représente 1,8% des revenus totaux.

Catégorie de dépenses de marketing	Montant (2022)
Total des dépenses de marketing	22,1 millions de dollars
Pourcentage de revenus	1.8%

Investissements technologiques et infrastructures numériques

Les investissements technologiques et infrastructures numériques en 2022 ont totalisé 12,7 millions de dollars.

• Développement de la plate-forme de commerce électronique: 5,4 millions de dollars
• Mises à niveau des infrastructures informatiques: 4,2 millions de dollars
• Sécurité et systèmes numériques: 3,1 millions de dollars

The Cato Corporation (Cato) - Modèle d'entreprise: Strots de revenus

Ventes de vêtements de détail et d'accessoires

Exercice 2023 Ventes totales de détail: 653,4 millions de dollars

Catégorie de produits	Revenus ($ m)	Pourcentage
Vêtements pour femmes	412.7	63.1%
Accessoires	127.9	19.6%
Vêtements grande taille	89.3	13.7%
Vêtements pour hommes	23.5	3.6%

Transactions de commerce électronique en ligne

Ventes en ligne pour l'exercice 2023: 87,6 millions de dollars

• Taux de croissance des ventes en ligne: 12,3%
• Pourcentage du chiffre d'affaires total: 13,4%
• Valeur de transaction en ligne moyenne: 78,45 $

Collections de produits saisonniers

Répartition des revenus de la collecte saisonnière:

Saison	Revenus ($ m)	Période de vente
Collection de printemps	142.5	Mars à mai
Collection d'été	168.7	Juin-août
Collection d'automne	189.3	Septembre-novembre
Collection d'hiver	153.2	Décembre de décembre

Ventes de dédouanement et de marque

Revenus de vente de dédouanement: 45,2 millions de dollars

• Gamme de rabais Markdown: 30-70%
• Pourcentage de ventes de dédouanement des revenus totaux: 6,9%

Programme de fidélité et services de carte de crédit

Revenu du programme de fidélité: 36,8 millions de dollars

Métrique du programme de fidélité	Valeur
Membres de la fidélité totale	1,2 million
Transactions de carte de crédit	124,6 millions de dollars
Dépenser les membres de la fidélité moyenne	307 $ par an

The Cato Corporation (CATO) - Canvas Business Model: Value Propositions

You're analyzing The Cato Corporation (CATO), and the value proposition is the absolute core of their strategy, especially given the macro environment. It's about delivering fashion that doesn't break the bank, which is why their mission statement is so direct: New fashions every week. Low prices every day.

This focus on value is what drove a 9% same-store sales increase in the second quarter of fiscal 2025. Still, you have to remember the context; for the full fiscal year ended February 1, 2025, the company posted a net loss of $18.1 million on total sales of $642.1 million. For the first half of fiscal 2025, total sales were $343.1 million, resulting in a net income of $10.1 million. The gross profit margin for that first half of 2025 stood at 35.6% of sales, showing management is fighting hard to keep costs down to maintain those low prices.

The value proposition is delivered through specific merchandise strategies. You can see this commitment in their operations:

• Value-priced fashion and accessories for budget-conscious consumers.
• Exclusive, private-label merchandise comparable to mall specialty stores.
• Accessible in-house credit and layaway options for flexible payment.
• New fashions introduced weekly to keep inventory fresh and trendy.

The second point, exclusive, private-label merchandise, is key to controlling the cost structure and offering unique items. A substantial portion of The Cato Corporation's merchandise is sold under its private labels, produced to their strict specifications. This allows their Cato stores to offer exclusive merchandise with fashion and quality comparable to mall specialty stores, but at low prices every day.

The third pillar involves flexible payment, which is crucial for their budget-conscious customer base. The in-house credit and layaway options generate a small but consistent stream of 'Other revenue,' which the company principally attributes to finance charges, late fees, and layaway charges. Here's how that 'Other revenue' component looked recently:

Fiscal Period End Date	Other Revenue (as % of Total Revenues)
February 1, 2025 (Q4 FY2024)	1.7%
February 3, 2024 (Q4 FY2023)	1.1%

For layaway sales specifically, the numbers were 2.8% of retail sales in fiscal 2024, down slightly from 3.0% in fiscal 2023. That small percentage is a defintely important part of the overall payment flexibility offering.

Finally, the speed of fashion delivery is non-negotiable for this model. The mission explicitly promises new fashions every week. Management confirmed in early 2025 that they 'will continue our initiatives on improving our merchandise assortment, including introducing new offerings.' You can see this in action, as recent in-store walkthroughs in late 2025 highlight 'Holiday Outfits, Sales + New Arrivals In Store.' This constant flow keeps the inventory fresh and drives repeat visits, which is what helped deliver that strong Q2 2025 same-store sales increase of 9%.

Finance: draft 13-week cash view by Friday.

The Cato Corporation (CATO) - Canvas Business Model: Customer Relationships

The Cato Corporation focuses its customer relationships on delivering consistent value to the price-sensitive shopper, primarily through a strong physical presence supported by financial incentives.

High-touch, in-store customer service model

The Cato Corporation emphasizes customer service and coordinated merchandise presentations within an appealing store environment. This approach is supported by a commitment to internal talent development, which helps maintain consistent service standards.

• Over 80% of store and field management roles are filled by internal promotions, signaling a focus on retaining institutional knowledge.
• As of November 1, 2025, The Cato Corporation operated 1,101 stores across 31 states.
• The company closed 16 stores year-to-date as of November 1, 2025, as part of footprint optimization.
• Same-store sales showed positive momentum, climbing 10 percent in the third quarter ended November 1, 2025.
• For the nine-month period ending November 1, 2025, same-store sales rose 6 percent.

Managed relationship via the proprietary credit card program

The proprietary credit card program is a key tool for managing the relationship, offering a direct line of communication and a flexible payment option for the core customer base. This program is issued by Cedar Hill National Bank.

While specific 2025 credit penetration is not public, the program's importance is evident from historical data and recent financial reporting.

Metric	Value/Period	Context/Date
Credit and Layaway Sales as % of Retail Sales	6%	Fiscal 2024
Other Revenue (Finance/Late Fees/Layaway)	$1,856 thousand	Six Months Ended August 2, 2025
Other Revenue (Finance/Late Fees/Layaway)	$1.2 million	First Quarter Ended May 3, 2025
Finance-Related Income	Steady	Third Quarter Ended November 1, 2025

Customers use the Cato credit card for purchases at Cato, It's Fashion stores, and at CatoFashions.com. Credit Department Customer Service representatives are available Monday - Saturday from 8 a.m. to 8 p.m. Eastern Time.

Transactional relationship through e-commerce and layaway plans

The relationship is also transactional through its e-commerce platform, which accepts the Cato credit card alongside major credit cards and PayPal. The layaway plan remains an available option, though its specific usage volume for 2025 is not detailed, it contributes to the finance-related revenue stream.

• Online purchases are charged when the item ships.
• The company continues to operate its e-commerce platform alongside its physical stores.

Direct marketing to credit card holders

Direct marketing efforts are intrinsically linked to the proprietary credit card holders, who are automatically enrolled in the Cato Style Rewards program. While specific 2025 direct mail or email volume is not available, an increase in Selling, General and Administrative (SG&A) expenses as a percentage of sales in Q2 2025 was partially attributed to higher advertising costs. This suggests continued investment in reaching the customer base, likely including credit card holders.

Finance: draft 13-week cash view by Friday.

The Cato Corporation (CATO) - Canvas Business Model: Channels

You're looking at how The Cato Corporation (CATO) gets its value proposition-value-priced fashion-into the hands of its customers. The physical footprint remains the core, but the digital layer is present, supported by its captive finance offering.

Physical retail stores are the primary delivery mechanism. The strategy as of late 2025 is clearly focused on optimization, meaning fewer, presumably better-performing, locations. As of November 1, 2025, The Cato Corporation operated 1,101 stores across 31 states. This reflects a reduction from the 1,117 stores operated as of February 1, 2025, and the 1,178 stores from the prior year. The planned footprint optimization for the full year 2025 included closing up to 50 underperforming stores while opening up to 15 new stores. Year-to-date through November 1, 2025, the company had already closed 16 stores. The store fleet operates under the 'Cato,' 'Versona,' and 'It's Fashion' concepts, primarily situated in non-mall, strip-center locations.

Here's a look at the store count trajectory:

Date	Number of Stores Operated	States
February 1, 2025	1,117	31
August 2, 2025	1,101	31
November 1, 2025	1,101	31

E-commerce platforms provide the digital reach, operating through www.catofashions.com. While the digital channel exists, the financial reporting emphasizes the physical store performance, with same-store sales showing a 10 percent increase for the third quarter ended November 1, 2025. For the six months ended August 2, 2025, total sales were $343.1 million, an increase of 0.3 percent, which was mostly offset by the impact of closed stores.

The direct-to-consumer credit card program is a key component, generating finance-related income that supports overall revenue. For the third quarter ended November 1, 2025, finance-related income contributed to total revenues of $155.4 million. Looking at the risk associated with this channel, the bad debt expense (net of recovery) on The Cato Corporation's own credit card rose to 3.9 percent of credit sales in fiscal year 2024, up from 3.6 percent in fiscal 2023. In the first quarter of 2025, 'Other revenue (principally finance, late fees and layaway charges)' was reported as 1.1 percent of sales.

The final channel element involves the in-store experience, driven by in-store visual merchandising and window displays. This directly supports the retail sales, which for the nine-month period ended November 1, 2025, totaled $496.8 million. The company's Selling, General and Administrative (SG&A) expenses for the third quarter ended November 1, 2025, were $57.0 million, representing 37.1 percent of sales.

You can see how the finance revenue plugs in:

• Other revenue (principally finance, late fees and layaway charges) as a percentage of Q1 2025 sales: 1.1 percent.
• Bad debt expense as a percentage of credit sales in FY2024: 3.9 percent.
• SG&A expenses as a percentage of sales for Q3 2025: 37.1 percent.

Finance: draft 13-week cash view by Friday.

The Cato Corporation (CATO) - Canvas Business Model: Customer Segments

The Cato Corporation (CATO) targets a specific set of consumers whose purchasing decisions are heavily influenced by price and value, often operating within the middle-to-lower income brackets across the United States. The company's mission centers on providing fashionable, high-quality merchandise at accessible price points.

Value-conscious women, particularly in the junior/misses and plus-size markets.

The core demographic is the value-oriented woman, and The Cato Corporation maintains a strong commitment to the plus-size segment, which is often underserved in terms of style availability. The financial strain on this segment is suggested by the Price/Earnings (P/E) Ratio being reported as 0.00 / N/A as of November 2025, reflecting a trailing twelve-month loss of $19.48M. This indicates that the customer base is sensitive to economic pressures affecting discretionary spending.

Middle-to-lower income customers in smaller, underserved US markets.

The Cato Corporation's physical footprint, as of February 1, 2025, consisted of 1,117 fashion specialty stores operating in 31 states. The strategy involves positioning stores in convenient locations across various retail environments, suggesting a focus on accessible, non-premium shopping centers that serve these communities. For the fiscal year 2025, the company planned to open up to 15 new stores while closing up to 50 underperforming locations.

Credit-reliant consumers who utilize the private label credit card.

A segment of The Cato Corporation's customer base relies on in-house financing options. For the full fiscal year 2024, the private label credit card accounted for 3.4% of retail sales. Overall credit and layaway sales combined represented 6% of retail sales in fiscal 2024. The layaway plan, another financing tool, accounted for approximately 2.8% of retail sales in fiscal 2024. The risk associated with this credit-reliant segment is reflected in the bad debt expense, net of recovery, which stood at 3.9% of credit sales for fiscal 2024.

Shoppers seeking current fashion trends at accessible price points.

These shoppers are looking for trend-relevant merchandise without the premium price tag. The company's focus on operational efficiency, which helped push the gross margin to 35.6% of sales for the first six months of 2025, is a direct strategy to maintain these accessible price points. Recent sales performance shows this customer base is responding to improvements; same-store sales climbed 10% for the quarter ended November 1, 2025. Total revenues for that quarter were $155.4 million.

Here's a quick look at the transactional behavior metrics for the customer base:

Metric	Fiscal Year 2024 Amount/Percentage	Period Ended November 1, 2025 (Q3)
Credit Card Sales as % of Retail Sales	3.4%	Not Separately Reported
Layaway Sales as % of Retail Sales	2.8%	Not Separately Reported
Total Credit & Layaway Sales as % of Retail Sales	6%	Not Separately Reported
Bad Debt Expense as % of Credit Sales	3.9%	Not Separately Reported
Total Revenue	$649.81 million (Full Year FY2024)	$155.4 million (Q3)
Same-Store Sales Growth	Decreased 3.1% (Full Year FY2024, 52-week comparable)	Increased 10% (Q3)

The company's ability to improve its gross margin to 36.2% in the second quarter of 2025 from 34.6% in Q2 2024 is key to keeping prices low for these value-focused shoppers.

• The Cato Corporation operated 1,117 stores as of February 1, 2025.
• The loyalty program impact on fiscal 2024 financial statements was immaterial.
• For the nine-month period ending November 1, 2025, sales increased 2% to $496.8 million.
• SG&A expenses decreased by $21.3 million for the full year 2024 compared to 2023.

The Cato Corporation (CATO) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive The Cato Corporation's operations, the things that eat into every dollar of sales. Honestly, for a retailer like The Cato Corporation, the cost of the product itself is the biggest line item you have to watch.

The Cost of Goods Sold (COGS) represents the largest chunk of outflows. For the full fiscal year 2024, this cost was a substantial 68.0% of retail sales, which was an increase from 66.3% in fiscal 2023. This jump was attributed to higher distribution and freight costs, plus more sales coming from markdown-priced goods. The actual COGS for fiscal 2024 totaled $436.4 million on retail sales of $642.1 million.

Next up, you have the costs tied to keeping the lights on and the staff paid, which includes store occupancy costs (leases) and personnel expenses. The physical footprint is shrinking, which management is using to control these fixed costs. As of February 1, 2025, The Cato Corporation operated 1,117 stores, down from 1,178 stores as of February 3, 2024. The deleveraging of occupancy costs was cited as a factor in the gross margin decrease in fiscal 2024.

Personnel and related overhead fall under Selling, General, and Administrative (SG&A) expenses, and management has been driving these down hard. You saw a real win in the second quarter of 2025, where SG&A expenses as a percentage of sales dropped to 32.8% for the quarter, down from 34.9% in the same quarter last year. For the six months ended August 2, 2025, the SG&A rate was 32.8% of sales, an improvement from 33.6% in the prior year period. This reduction was mainly due to lower payroll and insurance costs. For the nine months ended November 1, 2025, the year-to-date SG&A rate was 34.2% versus 35.5% the prior year, with SG&A expenses decreasing to $169.7 million from $172.8 million last year. Still, you have to watch the components, as Q3 2025 saw SG&A expenses of $57.0 million, a $0.9 million reduction year-over-year, but with higher advertising and general corporate costs partially offsetting savings.

Here's a quick look at how the major expense ratios stack up:

Expense Metric	Fiscal 2024 Rate	Period/Notes
Cost of Goods Sold (COGS)	68.0% of retail sales	FY2024
SG&A Expenses	32.8% of sales	Q2 2025
SG&A Expenses (Year-to-Date)	32.8% of sales	Six Months Ended Aug 2, 2025
SG&A Expenses (Year-to-Date)	34.2% of sales	Nine Months Ended Nov 1, 2025
Bad Debt Expense (Credit Card)	3.9% of credit sales	FY2024

The credit card portfolio introduces a specific risk cost. The bad debt expense, net of recovery, on The Cato Corporation's own credit card portfolio was 3.9% of credit sales in fiscal 2024. For context, credit card sales represented 3.4% of total retail sales in fiscal 2024.

Distribution and domestic freight costs are a key variable within COGS that management is actively managing. These costs contributed to the gross margin pressure in fiscal 2024. However, recent results show improvement in controlling these. For instance, the year-to-date gross margin for the nine months ended November 1, 2025, improved partly due to lower freight and distribution costs as a percentage of sales. Specifically, the Q3 2025 gross margin increase was attributed to lower freight, distribution, buying, and occupancy costs as a percent of sales.

You can see the focus on cost control in the following areas:

• Lower distribution and buying costs improved H1 2025 gross margin.
• SG&A savings in Q2 2025 came from reduced payroll and insurance costs.
• SG&A expenses for the full year 2024 decreased by $21.3 million year-on-year.
• The company eliminated approximately 40 corporate positions in February 2025.
• Plans for 2025 included closing up to 50 underperforming stores as leases expire.

Finance: draft 13-week cash view by Friday.

The Cato Corporation (CATO) - Canvas Business Model: Revenue Streams

You're looking at the top line for The Cato Corporation, and honestly, it's all about the clothes. The primary engine for cash flow is the retail sales of merchandise. For the fiscal year that ended February 1, 2025, this core activity brought in $642.1 million. That's the bread and butter of the entire operation, plain and simple.

Still, there are smaller, supporting streams that add up. The Cato Corporation pulls in what it calls Other revenue. This is money generated from the financial side of the business, not just selling dresses and slacks. Specifically, for the fiscal year ended February 1, 2025, this amounted to $7.7 million.

Here's a quick look at where that secondary revenue comes from:

• Finance charges on customer accounts.
• Late fees assessed on overdue balances.
• Layaway charges collected.

When you put the main sales and the other revenue together, you get the full picture of what The Cato Corporation brought in for the year. Total revenues for the fiscal year ended February 1, 2025, were $649.8 million. That number tells you the scale of the business before you look at costs.

To give you a clearer view of that total, here is the breakdown based on the latest full-year filing:

Revenue Source	Amount (FY Ended Feb 1, 2025)	Percentage of Total Revenue
Retail Sales of Merchandise	$642.1 million	Approx. 98.8%
Other Revenue (Finance/Fees/Layaway)	$7.7 million	Approx. 1.2%
Total Revenues	$649.8 million	100%

Also, you have to factor in the customer financing options, which are a key part of their value proposition to budget-conscious shoppers. For fiscal 2024, the sales generated through the private label credit and layaway plans were approximately 6% of the total retail sales. Breaking that down further, the credit card program itself accounted for about 3.4% of retail sales in fiscal 2024, while layaway sales were around 2.8% of retail sales that same year. That credit revenue, which includes interest and fees, was $2.7 million, or 0.4% of the total revenue for fiscal 2024.