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J. Lindeberg is relaunching its wholesale fashion business in the U.S., following several years of focusing on its golf business in America. The move is part of an overall restructuring of the U.S. division, following the end of a joint-venture agreement in October with People’s Liberation, which had overseen the brand in the U.S. since 2008.
This story first appeared in the June 14, 2012 issue of WWD. Subscribe Today.
“Our fashion business has been pretty much nonexistent in the U.S. for the past three years,” said Stefan Engström, who returned to the Sweden-based company as chief executive officer in April. He previously ran J. Lindeberg from 2007 to 2010 and holds a minority stake in the company.
The J. Lindeberg fashion collection has only been available in the U.S. in the company’s stores, located in SoHo in New York, the Beverly Center in Los Angeles and the Aventura Mall in Miami. Under the People’s Liberation joint venture, the golf business was the centerpiece of U.S. distribution and is now sold in about 250 green grass shops.
“The most important part of our strategy here is to relaunch our fashion business. That’s where we see the biggest opportunity for growth, as golf is a limited market,” said Engström. This fall, the J. Lindeberg fashion line will be reintroduced to about 15 wholesale accounts, including Confederacy in Los Angeles, Rand + Statler in San Francisco and Clothing Brigade in Ohio, which were former brand stalwarts. A larger rollout is planned for spring 2013 and the company is aiming to be in about 40 to 50 doors by next year, with the emphasis on directional, independent specialty stores.
The U.S. business is now run directly as a subsidiary of Stockholm-based J. Lindeberg, as part of a global strategy to take back distribution from local partners. Last fall, the company set up a new headquarters and showroom in New York, at 54 Greene Street, and moved distribution to a New Jersey warehouse from the Los Angeles facility previously used by People’s Liberation.
“About 85 percent of our worldwide sales are now from directly operated businesses,” said Engström. The only local distribution deals that remain in place are in Japan, South Korea, Southeast Asia, Dubai and Canada.
Over the past year, a new sales and customer service team was hired for the U.S., with Erik Ulin appointed managing director of J. Lindeberg’s U.S. business. He was previously a director at FTI Consulting, with expertise in corporate finance and restructuring advisory services.
Last year, the U.S. accounted for $10 million in sales, with 60 percent of that in golf and 40 percent from the three retail stores. Globally, J. Lindeberg sales were $65 million in 2011, a low-double-digit increase from 2010. The company has been rebuilding turnover from a low of $50 million in 2009, following the financial crisis, and volume is now on par with 2006 levels, said Engström.
Outside the U.S., J. Lindeberg’s biggest initiative is in China, where the company has inked leases to open 25 directly owned stores over the next six months, with the first one opening in July in Beijing’s Indigo Mall. “China will become our largest market. Within two years, it will equal our sales in the rest of the world,” said Engström.
The China strategy comes on the heels of the acquisition of a majority of J. Lindeberg last fall by partners Anders Holch Povlsen, Allan Warburg and Dan Friis, who have expertise in the China market. The trio are partners in Bestseller Fashion Group China, which was established in 1996 and operates over 5,000 stores in that market.
J. Lindeberg is primarily a men’s brand but last fall the company reintroduced a long-dormant women’s collection in Europe. Engström is considering bringing the women’s fashion line to the company’s U.S. retail stores for spring.
The company is aiming to expand its retail base here, with plans to open two to four new stores in the next 12 to 36 months. Engström is looking at locations on Bleecker Street in New York and spaces in Los Angeles, Chicago, Boston and Washington.
“The J. Lindeberg brand is fantastic and very well known — but it was mismanaged for some years,” admitted Engström. “The business had gotten diluted, with too much denim and logo-type product. We have created an entirely new platform to deliver a higher-quality product that is more sophisticated and at a higher price point.”