NEW YORK — New York & Company Inc., once known as Lerner New York, has eliminated any trace of its former moribund self.
Now it’s planning to open outlets for the first time, and roll out at least 50 regular-price stores annually for the next few years, including sites in Manhattan where the chain operates two. The moderate-priced chain is also playing up accessories through a “side-by-side” dual-store format launched November 2003.
According to chairman and chief executive Richard P. Crystal, the 490-unit, $1.04 billion company could grow to 800 stores and 100 outlets — and that doesn’t include the vision for Jasmine, the upscale contemporary 14-unit retailer purchased this week and operating stores called JasmineSola and Luisa Luisa.
Crystal declined to discuss specific growth plans for Jasmine, or its price tag, but he did say why he thinks his New York & Co. chain is ready to ramp up growth. “There is no trace of Lerner’s anymore,” said Crystal, who has been running New York & Co. since 1996 and before that ran Macy’s product development program. “Lerner’s was a big ship — a 900-store business doing $1 billion in sales. It took a long time to transition, but the business wasn’t totally broken or losing buckets of money. It was marginally profitable, but it wasn’t moving.”
Until now. “We’re expanding the business. Remodels are getting good results, and we are excited about what the accessory business provides for us.”
In 2002, Limited Brands sold Lerner New York to an investor group led by Crystal and Bear Stearns Merchant Banking for a total of $153.5 million in cash and notes. The company built teams for design, sourcing and production, downsized its store base and, as Crystal said, “moved from a store with brands to a brand that has stores.” In 1996, stores averaged $1 million in sales. “Now we are at $2.2 million.” All the Lerner nameplates were gone by July 2004.
The Boston-based Jasmine was New York & Co.’s first acquisition. “This is a good strategic fit,” Crystal said. Jasmine offers “a price point and customer base that doesn’t compete with New York & Co.” Asked about buying another business, Crystal said, “We are not in the market, but we always look for opportunities. Investment bankers call constantly. Our main thrust is to grow New York & Co. right now. We have planned 50 to 60 new stores annually over the next three to four years, and we are renovating 40 to 50 every year.” He described the renovations as “full scale,” costing 80 to 90 percent of the cost of a new store. Asked if there was a ceiling on the store count, he replied, “We have identified somewhere north of 800 stores.”
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