| Type | Private |
|---|---|
| Industry | Retail |
| Founded | 1983 |
| Headquarters | New York City, New York, U.S. |
| Number of locations | 333 (January 2011)[1] |
| Key people | Millard Drexler (Chairman and CEO) Jenna Lyons (President and Creative Director) |
| Products | Clothing, shoes and accessories |
| Revenue | US$ 1.722 billion (FY 2011)[1] |
| Operating income | US$ 214.0 million (FY 2011)[1] |
| Net income | US$ 121.5 million (FY 2011)[1] |
| Total assets | US$ 860.2 million (FY 2011)[1] |
| Total equity | US$ 511.1 million (FY 2011)[1] |
| Owner(s) | TPG Capital and Leonard Green & Partners |
| Employees | 12,700 (January 2011)[1] |
| Divisions | J.Crew crewcuts Madewell J.Crew Factory |
| Website | JCrew.com |
J.Crew Group, Inc. is a multi-brand, multi-channel, specialty retailer. The company offers an assortment of women's, men's and children's apparel and accessories, including swimwear, outerwear, loungewear, wedding, bags, hair accessories, belts, jewelry, and shoes. As of January 30, 2010, it operated 321 retail stores throughout the United States. The company conducts its business through retail, factory, clearance, crewcuts, and Madewell stores, catalogs, and on its Website.[2]
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In 1947, Mitchell Cinader and Saul Charles founded Popular Merchandise, Inc., a store which did business as Popular Club Plan and sold low-priced women’s clothing marketed through in-home demonstrations.[3]
The 1980s marked a booming sales period for catalog retail giants Lands’ End, Talbots, and L. L. Bean. Popular Merchandise initiated its own catalog operation, focusing on leisurewear for upper-middle-class customers, aiming for a Ralph Lauren look at a much lower price. The first Popular Club Plan catalog was mailed to customers in January 1983 and continued under that name until 1989. Popular Club Plan catalogs often showed the same garment in more than one picture with close-up shots of the fabrics, so customers could get a sense of how the garment looked on the body and be assured of the company’s claims of quality. Throughout the mid-1980s, sales from catalog operations grew rapidly. “Growth was explosive—25 to 30 percent a year,” Cinader later recollected in the New York Times. Annual sales grew from $3 million to more than $100 million over five years.[4]
In 1985, the “Clifford & Wills” brand was launched, selling women’s clothing that was more affordable than the Popular Merchandise line. The brand was sold to Speigel, Inc. in 2000 with the intent to boost sales.[5]
In 1987, two executives left the company to start their own catalog, Tweeds.[6]
In 1989, Popular Merchandise, Inc. became known as J.Crew, Inc. The company attempted - and failed - to sell the Popular Club Plan brand.[7]
Also in 1989, J.Crew opened its first retail store, in South Street Seaport in downtown Manhattan.[8]
In March 1989 the first J.Crew retail outlet opened in the South Street Seaport in Manhattan, and the company planned to open 45 more stores. Five months after the opening of its first store, J.Crew added two new catalog lines: “Classics” and “Collections.” “Collections” used more complicated designs and finer fabrics to create dressier and more expensive items, while “Classics” featured clothes that could be worn both to work and for leisure activities. In the fall of 1989, J.Crew opened three new stores in Chestnut Hill, Massachusetts; San Francisco, California; and Costa Mesa, California, all locations with strong catalog sales. By the end of the year, retail sales nearly hit $10 million. Despite 1989 revenues that were estimated at $320 million, J.Crew suffered a setback when its agreement to sell its Popular Club unit collapsed at the end that year. In addition, rumors circulated that the company’s Clifford & Wills low-priced women’s apparel catalog was doing poorly. J.Crew saw revenues reach $400 million in 1990 but reported that its four existing stores had not yet started producing enough profits to cover their overheads. The next phase of store openings included outlets in Philadelphia, Cambridge, and Portland. The company scaled back its plans for opening retail stores from 45 stores to 30 or 35.
In early 1991 the company hired a director of new marketing development and began efforts to expand their sales into Canada. In April 1991, J. Crew mailed 75,000 J.Crew catalogs and 60,000 Clifford & Wills catalogs to potential customers in the province of Ontario. Response rates to this effort were slightly lower than in the United States, but each order, on average, was higher.
In 2011, J. Crew opened its first international store in the Yorkdale Shopping Centre in Toronto, Ontario.[9]
In 1992, J.Crew intensified its push into international markets by hiring a new vice-president for international development. The company already mailed hundreds of catalogs to customers in Japan and Europe, most of whom had become acquainted with J.Crew while traveling or living in the United States.
In an interview with the Financial Times, CEO of J.Crew Mickey Drexler let slip that J.Crew would be expanding to the U.K. with their flagship store being on London's Regent Street. He indicated that the company would be following up their recent expansion into Canada and Canadian ecommerce with a physical store in England, most likely followed by ecommerce elsewhere, such as France and Germany. Although a few locations were reviewed for the London store, including Covent Garden and the East End, the ultimate decision was to open on Regent Street.[10]
Each year the company issues 24 editions of the J.Crew catalog, distributing more than 80 million copies. As of January 2011, the company operates 248 retail stores, including 217 J.Crew stores, 27 Madewell stores, and 9 crewcuts stores, as well as 85 J.Crew Factory outlet locations. Additionally, the company has 76 locations in Japan, which are operated under license by ITOCHU Corporation. J.Crew Group was owned by the Cinader family for most of its existence, but in October 1997 investment firm Texas Pacific Group Inc. purchased a majority stake in the firm. By the year 2000, Texas Pacific held an approximate 62 percent stake, a group of J.Crew managers held about 10 percent, and Emily Cinader Woods, the chairman of J.Crew and founder of the J.Crew brand along with her father, Arthur Cinader, held most of the remainder.
On November 23, 2010, the company agreed to be taken private in a $3 billion deal led by management with the backing of TPG Capital and Leonard Green & Partners, two large private equity firms. The announcement of the offer from two investment firms—including one that used to own J.Crew—came as the retailer reported Tuesday that its third-quarter net income fell 14 percent, hurt by weaker women's clothing sales. The company also lowered its guidance for the 2010 year. Under the deal as proposed, J.Crew shareholders would receive $43.50 per share in cash, representing a 16 percent premium to the stock's closing price the prior day of $37.65. CEO Mickey Drexler, the former Gap Inc. chief credited with turning J. Crew around since coming aboard in 2003, will remain in that role and retain a "significant" stake in the company (as of September 2010, he holds 5.4% of outstanding shares). TPG, one of the investment firms in the deal, took a majority stake in J.Crew Group Inc. in 1997 and remained majority shareholder until the company went public in 2006.[11]
Shortly after the announcement of the deal, some in the business community criticized the terms of the deal involving the company's CEO and a majority shareholder.[12] As a result, the "go-shop" period was extended shortly after the initial announcement. [13] In addition, several investigations relating to potential shareholder actions against the company were announced.[14]
http://www.theodoraandcallum.com/blog/cat/creative-factory/post/my-faves-dr-peggy-drexler/
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