NEW YORK — J. Crew Group Inc. takes a giant step forward in its international expansion this week by rolling out distribution to 78 countries, on top of the 29 nations the brand currently ships.
This story first appeared in the March 21, 2012 issue of WWD. Subscribe Today.
Details of J. Crew’s growth plans — domestic and overseas — over the next three to five years were outlined in a conference call Tuesday conducted by James Scully, chief administrative and financial officer; Libby Wadle, executive vice president, retail and factory, and Stuart Haselden, treasurer. The call also covered J. Crew’s results for the fourth quarter, reported Monday, which saw a more than threefold increase in net profit, a 15 percent gain in earnings before interest, taxes, depreciation and amortization, and a 6 percent comparable-store sales gain.
J. Crew products will be available in 41 currencies and the company is in the initial stages of exploring store opportunities in the U.K. and Asia. According to the officials, “outsized” growth over the next three to five years is seen for international expansion, as well as madewell.com, factory.com and the core J. Crew business.
According to Haselden, taking online orders internationally is “a low capital investment way to see where the demand is globally.…It’s a front-runner to bricks-and-mortar.”
J. Crew is also bullish on Canada, which is seen ultimately representing about 10 percent of North America revenues. J. Crew opened its first store in Canada last year, in the Yorkdale Shopping Centre in Toronto. Officials see “the full sweep up there” with retail stores, factory outlets and online, leading to “a meaningful business” within three years.
The officials were optimistic about the Madewell brand, which has 32 stores currently and plans to open 15 this year, primarily in the Atlanta, Pasedena, Calif., and Denver markets. Madewell will also be venturing further into the Midwest to gauge interest in that part of the country. In addition, Madewell will be expanding its digital marketing and launching a social media outreach program this spring. The Madewell ramp-up is expected to accelerate after 2012.
Last year, the core J. Crew brand experienced some difficulty in its women’s business, but the officials said that in the fourth quarter, the trends improved, although the most comp-store growth was in men’s and accessories. This spring also has seen improvement in women’s selling. According to Wadle, increased fashion and color in the assortment, as well as J. Crew’s “franchise” categories such as schoolboy blazers, cafe capris, pencil skirts and cashmere, paced the business. On the other hand, more casual areas like knit T-shirts have not been as robust.