J.Crew

Overview

J.Crew Group, Inc.

type	Private
key people	Libby Wadle (CEO) Julia Collier (CMO)
industry	Retail
products	Clothing, shoes, and accessories
revenue	US$2.54 billion (2019) ‡R1R‡‡R2R‡
net income	US$−78.8 million (2019) ‡R1R‡
assets	US$1.599 billion (2019) ‡R1R‡
equity	US$−1.35 billion (2019) ‡R1R‡
owner	Anchorage Capital Group and Leonard Green & Partners‡R3R‡
num employees	9,400 (2019) ‡R1R‡
divisions	J.Crew crewcuts The Liquor Store (defunct) The Ludlow Shop J.Crew Factory J.Crew Mercantile Madewell
homepage	jcrew.com
foundation	1947 (as Popular Merchandise, Inc.) 1983 (as J.Crew)
founders	Mitchell Cinader Saul Charles
location	225 Liberty Street, New York City, US
locations	506 (2018)

J.Crew Group, Inc., is an American multi-brand, multi-channel, specialty retailer. The company offers an assortment of women's, men's, and children's apparel and accessories, including swimwear, outerwear, lounge-wear, bags, sweaters, denim, dresses, suiting, jewelry, and shoes.

In 2010, it sold via retail outlets, mail order catalogs, and an online store.[4] As of August 2016, it operated more than 450 retail stores throughout the United States.[5] On May 4, 2020, the company announced that it would apply for bankruptcy protection amidst the COVID-19 pandemic. J. Crew successfully exited bankruptcy protection in September 2020.[6]

History

Formation and catalog growth

Recent

In June 2015, The New York Times reported that J.Crew's women's division was undergoing a slump because of the company's failure to react to two market trends: cheap "fast fashion" and "athleisure" items.[22] In 2016, J.Crew partnered with Nordstrom to begin selling their products in stores and online.[23] In December 2016, the company faced litigation after it moved its intellectual property "out of the reach of lenders."

In April 2017, the company cut 250 jobs, largely from its headquarters. The company also underwent several management changes, and long-term creative director Jenna Lyons left the company in April.[24] The brand's longtime head of menswear, Frank Muytjens, left the company that month as well,[25] and in June 2017, the company's CEO, Mickey Drexler, announced that he would leaving his CEO role after 14 years with the company.[26] However, Drexler stated he would remain chairman and retain 10% ownership of the company.[27]

On June 12, 2017, J.Crew Group Inc. announced it had "made an offer to some of its bondholders to push back its most pressing debt obligation—about $567 million due in May 2019—and amend its term loan." At the time, J.Crew Group had around $2 billion in debt.[28] Also in 2017, Drexler approached Amazon Inc about selling J.Crew to the tech giant.[29] In the summer of 2017, the company avoided a bankruptcy filing by having bondholders do a debt swap tapping into its brand name value. The majority of the bondholders agreed to the deal, with several others failing to stop the deal with a lawsuit. The deal lowered the company's debt.[30] In September 2018, J.Crew began selling its standalone J.Crew Mercantile brand on Amazon.[31]

On February 16, 2018, J.Crew hired Adam Brotman, a long-time Starbucks executive, as president and chief experience officer.[32] Brotman's first major impact was launching "J.Crew Rewards", the company's first reward program independent of the company's credit card. The rewards program offers free shipping and $5 back for each $200 spent.[33]

In November 2018, J.Crew announced its CEO, James Brett, would step down and be replaced by an office of the CEO consisting of four senior executives from J.Crew.[34] Brett took up the position in June 2017.[35] The company released a press release stating Brett's departure was a "mutual agreement" between Brett and the company's board of directors. Brett was replaced by Michael Nicholson (president and COO), Adam Brotman (president and chief experience officer), Lynda Markoe (chief administrative officer), and Libby Wadle, president of Madewell brand. The new office of the CEO will be responsible for managing J.Crew's operations as the board establishes a permanent management structure.[36][37] On November 29, J.Crew announced the dissolution of their Nevereven, Mercantile, and J.Crew Home sub-brands.[38] On April 11, 2019, J.Crew announced that president and COO, Michael Nicholson, would retain the title of interim CEO, along with the subsequent announcement of Brotman's departure.[39]

J.Crew reported a net income of $1.5 million in the fourth quarter of 2019, up from a net loss of $74.4 million in quarter four of 2018.[40][41][42]

On January 28, 2020, the retailer announced that Jan Singer would assume title of CEO.[43] Singer was previously CEO of Victoria's Secret, Spanx and was an executive at Nike.[44] She was to replace Nicholson, who would assume his previous position.

On May 4, 2020, J.Crew filed for Chapter 11 bankruptcy protection as a result of the COVID-19 pandemic,[45] although the company had amassed enormous debt even before the outbreak.

Chinos Holdings, Inc. and 17 affiliated debtors filed Chapter 11 bankruptcy in the United States District Court for the Eastern District of Virginia. These debtors requested joint administration of the cases under Case No. 20-32181.[46]

In September 2020, J.Crew permanently closed all six of its UK stores after its parent group emerged from Chapter 11 bankruptcy following an approval plan to cut its debts.[47]

In November 2020, J.Crew appointed new chief executive officer. Libby Wadle replaced Jan Singer, who had been CEO for less than a year.[48][49]

Retail stores

The company once operated 506 retail stores, including 203 J.Crew stores, 129 Madewell stores, and 174 J.Crew Factory (including 42 J.Crew Mercantile) outlet locations, as reported in 2018.[50] In 2010 it also had Crewcuts stores, using the name of its children's brand (styled lowercase crewcuts).[4][51] The company also operates internationally in Canada, France, the UK, and Hong Kong. Additionally, the company has 76 locations in Japan, which are operated under license by ITOCHU Corporation.[52]

In March 1989, the first J.Crew retail outlet opened in the South Street Seaport in Manhattan, and the company planned to open 45 more stores. Five months after the opening of its first store, J.Crew added two new catalog lines: Classics and Collections. Collections used more complicated designs and finer fabrics to create dressier and more expensive items, while Classics featured clothes that could be worn both to work and for leisure activities. In the fall of 1989, J.Crew opened three new stores in Chestnut Hill, Massachusetts; San Francisco, California; and Costa Mesa, California, all locations with strong catalog sales. By the end of the year, retail sales nearly hit $10 million. Despite 1989 revenues estimated at $320 million, J.Crew suffered a setback when its agreement to sell its Popular Club unit collapsed at the end that year. In addition, rumors circulated that the company's Clifford & Wills low-priced women's apparel catalog was doing poorly.

J.Crew saw revenues reach $400 million in 1990 but reported that its four existing stores had not yet started producing enough profits to cover their overheads. The next phase of store openings included outlets in Philadelphia, Cambridge, and Portland, Oregon. The company scaled back its plans for opening retail stores from 45 stores to 30 or 35. In early 1991, the company hired a director of new marketing development and began efforts to expand their sales into Canada. In April 1991, J.Crew mailed 75,000 J.Crew catalogs and 60,000 Clifford & Wills catalogs to potential customers in the province of Ontario. Response rates to this effort were slightly lower than in the United States, but each order, on average, was higher. In 1992, J.Crew intensified its push into international markets by hiring a new vice-president for international development. The company already mailed hundreds of catalogs to customers in Japan and Europe, most of whom had become acquainted with J.Crew while traveling or living in the United States.

In 2011, J.Crew opened its first international store in the Yorkdale Shopping Centre in Toronto.[53] In 2012, J.Crew announced four new Canadian locations: Edmonton in West Edmonton Mall, Vancouver on Robson Street, and Toronto in Fairview Mall (now closed) and the Toronto Eaton Centre. All locations were to carry women's and men's collections. Along with 5 new stores, although some of these stores have been closed recently. J.Crew announced opening two new factory stores in Canada: one in Vaughan Mills and the other in Edmonton (the second J.Crew in Alberta).[54][55][56]

In an interview with the Financial Times in 2011, CEO of J.Crew Mickey Drexler said that J.Crew would be expanding to the UK with their flagship store being on London's Regent Street. He indicated that the company would be following up their recent expansion into Canada and Canadian e-commerce with a physical store in England, most likely followed by e-commerce elsewhere, such as France and Germany. Although a few locations were reviewed for the London store, including Covent Garden and the East End, the ultimate decision was to open on Regent Street.[57]

From 2016 to 2018, J.Crew Group closed 96 J.Crew and J.Crew Factory retail locations.[50] On March 2, 2020, J.Crew announced that it would pause the proposed Madewell IPO that was intended to be initiated on March 2. The company is considering a possible separation of J.Crew and Madewell into two separate companies.[40][41][42]

J.Crew

History

Formation and catalog growth

Name change and first stores

Going public, return to private

Recent

Retail stores

Marketing

See also

External links

References