In an effort to simplify and streamline its business, Mothers Work on Tuesday said it will restructure its brands and store nameplates, effectively eliminating its Mimi Maternity moniker.
The move, along with other cost-cutting initiatives, is intended to improve the company’s long-term profitability. Mothers Work said it will realize $5 million in annualized savings mainly due to reductions in employee payroll and benefits expenses, starting in the fourth quarter of fiscal 2008.
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The company declined to say how many positions will be eliminated, but Rebecca Matthias, president and chief creative officer, noted that only jobs at the company’s corporate headquarters in Philadelphia will be affected.
“One reason for the restructuring is to reduce costs in a tough environment,” Matthias said. “We’ve been growing for 25 years. We have a number of brands and have made a number of acquisitions. Doing this will help sales, improve our operations and de-confuse the customer. We were a very confusing company.”
Mimi Maternity apparel will be rebranded under the A Pea in the Pod label beginning with the spring 2009 collection. At the same time, A Pea in the Pod will be expanded with A Pea in the Pod Collection label for designs made from expensive fabrics and with more details and embellishments.
All 48 single-brand Mimi Maternity stores in January will be renamed A Pea in the Pod and 41 multibrand Mimi Maternity stores selling the Mimi label and Motherhood Maternity will become Destination Maternity stores. The company said Motherhood Maternity, which serves value-minded customers, won’t be affected by the restructuring.
“We’ve come to realize that our biggest successes have been A Pea in the Pod and Destination Maternity,” Matthias said. “We haven’t gotten the full benefit of the powerful A Pea in the Pod brand with only 31 stores. We don’t need two brands at the high end. We’re eliminating some of the duplication. We have two teams of merchants and designers and they all chase the same trends. We feel we’ve over-assorted.”
Matthias said the new A Pea in the Pod “has a new meaning. It starts at the Mimi Maternity price points. We’re not abandoning the Mimi merchandise position,” she added.
Destination Mat-ernity, a retail concept that brings all of Mothers Work’s brands under one roof, has been “the most successful of all the initiatives we’ve taken to combine the brands,” Matthias said. “We tried a lot of things, including combining Mimi Maternity and Motherhood Maternity and calling it Mimi. It was very difficult for consumers to understand that. Our new approach to any multibrand store is to call it Destination Maternity.”
Matthias said there won’t be any store closings as a result of the restructuring. She said the company has closed duplicative stores in recent years and continues to do so.
The restructuring will also benefit Mothers Work’s planned international expansion. “This streamlining helps what we’re doing,” she said. “We’ve worked very hard to get our large market position. Now our goal is to become a very profitable company.”