Kate Spade (NASDAQ:KATE) announced it will shutter all Kate Spade Saturday and Jack Spade stores to focus on the core brand.
As part of the plan, Kate Spade will absorb some of its Saturday brand business and Jack Spade will have a new business model which includes leveraging the brand through other retail partners and expanding its e-commerce platform.
Kate Spade Saturday's 16 company-owned and three partnered stores will be closed in the first half of 2015. The e-commerce site will remain active until the label is incorporated and reintroduced into the Kate Spade New York brand.
And the new business model for Jack Spade will focus on growing the brand through distribution in two channels: strong retail partners and e-commerce. The collection will evolve to include tailored clothing and dress furnishings, in addition to sportswear and bags. Since the target consumer is shifting, the 12 company-owned stores will close during the first half of 2015.
Kate Spade has made great strides in its online presence both in e-commerce and social media. Last summer the brand, along with Urban Outfitters (NASDAQ:URBN) and Forever 21, made the list of the 500 Fastest Growing Brands on social scrapbooking site Pinterest.
"We continue to focus on two axes of growth—geographic expansion and product category expansion. We are early in our journey as Kate Spade and Company, and we see a clear path to becoming a $4 billion business at retail," said Craig Leavitt, CEO, Kate Spade. "By taking these actions, we will be able to accelerate the fulfillment of our lifestyle brand vision, expanding our product categories and reaching customers in all facets of their lives, better positioning us to deliver on Kate Spade New York's full potential."
Leavitt said the company is committed to its men's heritage and that it is an important part of growth. "With this new approach to distribution, Jack Spade is now better positioned to grow as we broaden our customer target," he added.
In addition, the company announced a partnership with Walton Brown, a subsidiary of The Lane Crawford Joyce Group, Asia's premier fashion retail and brand management group. The new venture will help accelerate Kate Spade's growth in China. Other fashion brands making a big push into Asia this year include Juicy Couture, a former Kate Spade brand, and Michael Kors (NYSE:KORS).
-See this Kate Spade press release
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