J Crew has announced more plans to lower its debt and increase sales and profits as sales decline for the first quarter fiscal 2017.
According to an article on Bloomberg, J Crew has announced more plans to lower its debt and increase sales and profits as sales decline for Q1. The plans include new pricing and marketing as well as job cuts and store closings. The announcement comes about a week after Millard Drexler announced he’d resign as CEO of the brand.
The company reported a 6.3% decline in revenue to $532 million with sales declining by 9%. Sales would have declined even more if it wasn’t for Madewell where sales increased by 17%. Sales declined by 11% at J Crew.
About a week ago Drexler announced he’d resign as CEO of the brand after 14 years. The brand also announced that James Brett is the new CEO, replacing Drexler. Drexler said that he had been planning to resign for a while and that it was his decision. Brett will be replacing Drexler next month and will join J Crew’s board of directors. Drexler will, however, stay with the company as Chairmanship of the brand’s board of directors.
A couple of months before that, Jenna Lyons resigned as creative director of the brand. Lyons resigned after having been with the brand for 26 years. Lyons had been replaced by Somsack Sikhounmoung, who was previously women’s Head of Design.
Drexler released a statement saying,
“while we are disappointed with our first quarter earnings, we are optimistic regarding the work we have underway to improve our business. We have a clear vision and action plan in place to meet our customers’ needs — wherever and however they choose to shop. I look forward to transitioning my role to chairman and to working with our new CEO, Jim Brett, as he takes the reins in July and continues to position J.Crew for long term success.”
During a conference call President, Chief Operating Officer, and Chief Financial Officer Mike Nicholson said the company had been looking at ways to increase sales and profits. Chief Merchandising Officer Lisa Greenwald along with Sikhounmuong will work on merchandising, bringing quality and value to classic looks and include new styles.
Nicholson also says the company will work on pricing to give the brand’s clothing more value.
The brand will also work on its print catalog, lowering deliveries and reinvest in digital marketing to increase sales. The catalog will also have less pages and will be separated into “his” and “hers” catalogs.
This is just the latest in the brand’s plans to increase sales and profits. A couple of months ago, J Crew announced that it would be cutting 250 jobs. In December, the brand was said to be in talks with creditors to lower its approximately $2 billion debt. Then, the brand reported declining sales for the fourth fiscal quarter 2016 and announced that it would be closing up to 20 stores.
So, what do you think? Will sales and profits increase at J Crew? Let me know in the comments below. Also, don’t forget to subscribe to get new posts sent directly to your inbox and follow me on Facebook, Instagram, and Snapchat.
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