Tag Archives: Style

J. Crew Going Public Once Again?

J. Crew, a brand that is one of Michelle Obama’s favorites, a brand that is defined by utility; contemporary style and an essence of preppiness has been rumored to be in talks with financial giants, such as Bank of America and Goldman Sachs, to refinance their debt and possibly become a publicly traded company, once again.  Just several years ago, J. Crew went private in a $3 billion deal with investment partners, TPG Capital and Leonard Green & Partners.  The reason being for such a departure from the trading floor was a decrease in sales.  During that year’s third quarter, net income had fallen by 14% due to weaker women’s clothing sales (J. Crew must certainly be grateful for our First Lady’s endorsement).  Moreover, stores that were open for at least one year saw their revenue fall by 1%.  In terms of the financial sector of the retail industry, J. Crew has been inconsistent; perhaps this is due to the constant shuffling of chairs in the New York based offices.

However, with the revitalization of J. Crew by CEO Millard Drexler and President Jenna Lyons, we are seeing an increase in sales and popularity.  Sales last year rose 9%, which was more than publicly traded brands, like Gap and Ralph Lauren.  I believe more time is necessary to see the true growth of J. Crew, but if it were to go public, the company would look to mirror the successes of similar brands that are ruling pop culture, such as Michael Kors (trading at $98) and Vince, a newcomer to the public market in 2013 seeing its stock rise 43% in its debut.

Further indicators of a public offering shall be debated with news surfacing about Japan based Fast Retailing Company’s Tadashi Yanai (chairman, president and CEO) wanting to acquire the J. Crew brand.  This would align Uniqlo, one of Japan’s largest clothing purveyors and one of my personal favorite shops, and J. Crew under one umbrella, making it an immediate giant in the fashion industry.  The $5 billion deal would enable the ambitious Yanai to attract more customers in the U.S. market to the rapidly expanding Uniqlo stores.  As J. Crew weighs the option of an IPO, stay tuned for more news on this potential acquisition.

As a prospective investor, pay attention to companies such as these, as their audience is global and quickly growing.  I’m certainly a novice when it comes to the financial sector, but I would suggest to invest in what you know.  Why would you financially concern yourself with corporations that you yourself are not personally involved with?  I love clothing.  J. Crew is a staple in my wardrobe and when I walk around my campus I can see its increased popularity.  If I were to invest in such a company, I wouldn’t just monitor its daily position in the market.  Since J. Crew is a part of my wardrobe, because I like to shop there and because the college style is very much catered to the J. Crew look, I would be able to observe my investment in a much more profound way.  Much like the clothing brands I mentioned above, J. Crew is a chic, urban brand while remaining relatively affordable for their followers.  I find this especially important for the college crowd, which is why J. Crew’s audience has room to expand.  Whether J. Crew is actually seeking to release an initial public offering remains to be seen.  The company may not even be a suitable long-term investment option, but for new, young investors and short-term stock options, J. Crew may be viable.

Maxwell

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The Secret Behind Nike’s Limited Releases

As I mentioned in my Introduction post, one of my interests revolves around global sportswear icon, Nike Inc.  Ever since I can remember, I’ve been enamored with The Swoosh.  The passion and ingenious behind each of their creations is something to marvel, for they continue to innovate and reimagine the way we think about apparel.  Also, the entrepreneurial ability and spirit of co-founders Phil Knight and Bill Bowerman to start a company out of the trunks of their cars to only transform it into a multibillion-dollar entity is admirable and something every kid dreams about doing.  Recently though, I’ve become more in tune with this interest and curiosity.  Not to say that I am a ‘sneakerhead’ (someone who has an insatiable desire to collect sneakers), but I have begun collecting several pairs of Nike footwear…currently five kicks (sneakers) deep.  If you aren’t familiar with Nike and this phenomenon of shoe collecting, I ask that you please check out this video of one of the most absurd sneaker closets you’ll ever see:

Limited release sneakers are what fuel this sneakerhead phenomenon.  You see, on just about every Saturday morning people of all ages wake up just a couple of minutes before eight O’clock with their momma’s credit card in hand or money from their latest paycheck to hit that Twitter link Nike supplies saying, “The Air Jordan 11 Retro ‘Gamma’ is now available”, so that they may have a chance at “copping” (buying) the latest Nike shoes to hit the virtual shelves.  The fact that these releases are limited alludes to the fact that many people end up empty handed after the shoe sells out in 10 minutes, only to try again, and probably fail, the following weekend.  What I don’t understand though, is the purpose it serves to continually release limited edition sneakers when Nike could easily supply more and accommodate the demand of each shoe.  Over the next couple of days I will be publishing my findings, stay tuned for part II to be released tomorrow.

Maxwell