J.Crew Company Ryan Lagasse Corporate Communications
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J.Crew CompanyRyan LagasseCorporate Communications
U.S. Apparel Industry History
Began with menswear in 1800’s
19th century Gold Rush Levi Strauss Jeans “easily transformed into utilitarian work
trousers”
Womenswear picked up in 1900’s First influenced by Parisian fashion Isolation of WW1&2 created confidence in
“correctness” of American lifestyle
Today U.S. retail industry has revenue of $150 billion
J.Crew Company History
Started as mail order catalogue in 1983 Popular Merchandise, Inc.
End of 80’s showed decline in mail order catalogues
South Street Seaport Flagship Store opened 1989 Success was great 3 more stores opened nationwide End of year revenue $320 million
327 J.Crew stores in U.S. to date
Brick & Mortar vs. Direct
CEO: Mickey Drexler
Brought on in 2003
Previous CEO of The Gap Credited with 1990’s revival Coined the “retail therapist”
Extremely involved in all aspects of company
Created an environment of “perceived exclusivity” Maintaining quality Less-than-designer price point Offering timeless classics with a twist
CEO: Mickey Drexler
In 2005, the company turned its first profit in five years, and between 2003 and 2008 revenues rose 107 percent. In 2006, Drexler presided over a very successful IPO. In 2009, revenues ($1.57 billion) exceeded pre-recession levels and same-store sales climbed 11 percent. Profits jumped 40 percent. When Drexler took up the reins in 2003, J. Crew had $609 million in debt and 196 stores. Today, it
has 321 stores, less than $50 million in debt and $298 million cash on hand.
-Wall Street Journal
Key Competitors
2010 Annual Sales 2010 Net Profit Margin
Lands’ End The GapL.L. Bean
Current Company StatusPrivately held as of March 1
$3 billion buyout Stockholders received $43/share
“It would provide greater flexibility and allow for planning unburdened by the demands of a public company's quarterly earnings schedule”
TPG Capitol: 71% Leonard Green & Partners: 19% Internal: 10%
71%
19%
10%
Americana Trend
What is it?
Americana TrendHow did it happen?
The recession prompted trendsetters to back away from avant-garde and revisit classic, durable goods made in America. Suddenly, fishermen and oil riggers are walking in the same boots as fashion-conscious advertising executives.
-KSTP.com
Industry Recession Strategies
Industry Impact
Standard And
Poor’s
Industry Impact
Annual Statistic
al Analysis of the U.S.
Apparel and
Footwear
Industry
Ryan Lagasse
Things to note:-Growth slowed significantly in last half of 2008, almost wiping out gains from first 6 months.-Numbers are significantly subdued compared to increases in 2007
Industry Impact
•U.S. production of apparel declined 41% in 2008•Clothing imports reached a record level of 97%•In the first 3 months of 2009 31,900 jobs were lost
J.Crew Recession Strategy
J.Crew Impact
•Total Revenues increased• Gross profit increased
Net Income increased
J.Crew Impact
$298,107 cash
on hand
J.Crew Impact
Future Outlook for J.CrewAmericana trend made J.Crew more relevant
Increased consumer awareness Obama marketing
International expansion Going private allows for greater fluctuation in
numbers Media/shareholders can’t comment
Increased market share
Increased profit margin
Thank You
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