The opening of its first travel-themed store in Salt Lake City today marks the start of a second chapter for the U.S. division of UNOde50.
Before the pandemic, the Madrid-based jewelry retailer had operated 105 stores globally, including 22 in the U.S. But many of those American stores were in undesirable locations and the company decided the best way to exit the unwanted leases was to file bankruptcy in America.
The company’s U.S. business, officially ARS REI USA, filed for Chapter 11 last August in New York bankruptcy court. At the time, it listed assets and liabilities between $1 million and $10 million, and its chief executive officer Jason McNary attributed the filing, like many retailers that appeared in bankruptcy court last year, to the COVID-19 pandemic and steep rents.
The company is navigating an exit from bankruptcy, though it hit some apparent roadblocks earlier this year. In April, the judge overseeing the case rejected the company’s disclosure statement on its Chapter 11 plan. In bankruptcies, a disclosure statement outlining the debtor company’s finances must be approved by the bankruptcy court before it can be sent out to creditors to vote on the company’s plan.
In April, U.S. Bankruptcy Judge Martin Glenn denied the disclosure statement and sent the company back to the drawing board, saying he wasn’t convinced that the company would be able to pay out bankruptcy claims from its projected income in 2021, and sought more details explaining the basis for its projections. The proceeding is ongoing.
McNary said the filing was an intentional move “to reject non-strategic leases, step back and evaluate our real estate strategy. Some of the stores were a financial burden and we thought it best to reorganize.”
So McNary closed the company’s stores on Prince Street in New York’s SoHo, Lenox Square in Atlanta and Roosevelt Field on Long Island, N.Y. It also closed its office in Midtown Manhattan and now operates out of Long Island City, N.Y. “We worked with our landlords on the bulk of the leases and came to favorable terms, but there were some stores we just shouldn’t have opened,” he said.
The plan, he said, is to exit bankruptcy later this summer and ramp up its retail rollout once again — but with a different mind-set. Globally, the company now has 100 stores, 19 in the U.S. and 28 in North America. By the end of this year, UNOde50 will increase that number in North America to 36 by adding or relocating eight units, McNary said. “We’re optimistic about our reorganization plan. Our focus for growth is to focus on where we’ve seen our most success historically.”
That includes Puerto Rico and Florida in particular. McNary, who had served as president of Agnes B before joining UNOde50 and is also a board member for the Faherty brand, said Puerto Rico is the brand’s number-one market in the U.S. It operates two stores there and will add three by August.
There are also six stores in Florida with more to come, including Aventura, which is slated for a November opening. That store will sport a prototype design with a much more upscale and minimalistic approach with an all-white color palette and a “soft and elegant” touch. That same design will be used at the brand’s store at the Venetian resort in Las Vegas, McNary said, which will be relocated in November, as well as new units in Northpark in Dallas and the Time Warner Center in New York City in October and September, respectively.
In November, UNOde50 will open a flagship at 542 Broadway in New York’s SoHo, which McNary characterized as “one of the most-important streets in the world to plant a flag.” The store will be 1,625 square feet — 700 square feet of which will be devoted to the jewelry and 925 square feet to a gallery to showcase the artwork of its president and creative director, Jose Azulay.
This will be only the second store in the fleet to have a gallery, following the original in Madrid, a two-story unit that opened in February on the corner of Caballero de Gracia, just off Gran Via, the city’s main shopping street.
“It’ll be a window on the world and a dream come true for Jose,” McNary said, adding that Azulay’s sculptures will retail for $3,200 to $11,250.
UNOde50 was created in Madrid in 1996 and originally offered only 50 pieces of each design, hence the name. In the late 1990s, the company was acquired by Azulay who sought to offer an assortment that pushes the envelope on traditional jewelry design. Today, the assortment for women and men is all handcrafted and manufactured in Spain and Portugal. And while its commercial collections offer more than 50 pieces, there are still some limited-edition offerings that are a nod to the company’s roots.
The store is targeted primarily to women although men’s is gaining in importance, McNary said. The average sale in the U.S. is $140, he said, and top sellers include Eslabomba bracelets in silver and gold, a snowflake necklace in silver, light-it-up earrings and a necklace from the Ecstasy collection. Prices range from $89 for a silver snowflake bracelet and necklaces for around $270 and top out at $1,500 for some of the limited-edition pieces. Globally, UNOde50 counts Pandora, Swarovski and other jewelry and accessories brands as competition.
Beyond the traditional stores, UNOde50 has expanded into a new arena: travel-themed stores in airports. The Salt Lake City unit is the first of a new concept operated in partnership with the Hudson Group. “We have previously worked with Dufry and have shops-in-shop in the Puerto Rico at the San Juan airport. This project in Salt Lake City’s new Delta terminal that opened in September 2020 is a new partnership that has been in development for two years and we are excited to build on this. This is a huge milestone for UNOde50 and our strategy over the next two years is to have at least 25 travel retail stores across the Americas market.”
McNary said the company has plans to revamp and grow its website, which accounts for only 12 percent of its business in the U.S.; institute a new digital marketing strategy that will speak more closely to its customer base, and enhance its wholesale operations, which account for 40 percent of sales in the U.S. The line is carried in Dillard’s, Hudson’s Bay, Von Maur and independent specialty shops and McNary said the goal is to work with the retailers to better represent the messaging of the line in their stores.
“Wholesale will always be a core part of the business and we’re investing in fixtures for our wholesale partners so we’re exposed in a more-marketable way,” he said. “This is consistent with the new brand image of the company, a global project to renew over 2,500 points of sale.”