The Cherokee Group Inc. is following its biggest U.S. licensee into Canada.
The brand management company reported that its Cherokee and Liz Lange Maternity brands, both licensed to Target Corp. in the U.S., will be sold under license in Target’s stores in Canada. Henry Stupp, chief executive officer of Cherokee, told WWD that the two brands are in the more than 20 former Zellers units already opened by the Minneapolis-based discounter in the Canadian market, a number expected to expand to 125 by the end of the year.
Zellers had been the Canadian licensee for the Cherokee brand prior to the sale of the retailer’s real estate to Target.
The Cherokee license was amended for Canada with a flat loyalty rate, rather than the de-escalating rate in place for the U.S. A separate three-year agreement was signed for Cherokee uniforms, a category Cherokee took back from a former licensee, at a flat 2 percent royalty rate. For Liz Lange, acquired by Cherokee last year, the Canadian agreement contains a higher minimum guarantee than the U.S. pact, Stupp said.
Stupp told WWD that another critical piece of its business — the Cherokee license held by Tesco for Central Europe and the U.K. — was being relaunched. “We were basically down to our minimum guarantee and have now introduced the brand in 279 stores, and on tesco.com, in a premium position,” he said. “The experience with Tesco — our need to do things to reinvigorate the brand there — really led to our new 360-degree strategy with our licensees. The product is greatly improved with slightly higher prices, and we’ve backed that with better suppliers, better in-store and outside marketing, better product development and support.
“The time and money that we spent on Tesco,” he continued, “were time and money we needed to spend anyway. As a brand owner today, it’s a fundamental requirement that you strengthen your existing relationships, especially if you want to cultivate new markets. The idea of ‘let the retailer do the heavy lifting’ is not working.”
In return for its expanded services, the royalty rate paid by Tesco to Cherokee was raised to 4 percent of sales from 3 percent. Prior to this adjustment, royalties from Tesco declined to $723,000 last year from $2.8 million in the prior 12 months, reducing Tesco’s share of royalty revenues to 3 percent from 11 percent.
Royalties from Target rose to $15 million, about 57 percent of the total, from $13.8 million, or 54 percent of the total, in the prior year.
The disclosures about the Target business in Canada came as the Sherman Oaks, Calif.-based company belatedly reported net income of $1.1 million, or 13 cents a diluted share, for the three months ended Feb. 2, 29.9 percent below the $1.5 million, or 18 cents, reported in the prior-year period. Revenues, all derived from royalty revenues, rose 0.4 percent to $6 million. Full-year profits dropped 9 percent to $6.8 million, or 81 cents, as revenues rose 3.7 percent to $26.6 million. Publication of the results had been delayed by an internal review of financial controls.
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye