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Kate Spade Saturday and Jack Spade to shut stores

By Danielle Wightman-Stone

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Fashion

Kate Spade and Company said that it would be shutting its Kate Spade Saturday and Jack Spade stores as it seeks to focus on the long-term growth of its flagship Kate Spade New York brand.

After just two years on the market, Kate Spade Saturday, the lower-priced, more casual offshoot of the main Kate Spade brand, is to close all of its 19 stores gradually over the first half of 2015, while the “key elements” of its success will be incorporated into the main Kate Spade line.

In addition, the Kate Spade Saturday e-commerce site will remain active during this wind down phase until the label is incorporated and reintroduced into the main Kate Spade brand.

Craig A. Leavitt, chief executive officer of Kate Spade and Company, explained: "We now have a better understanding of our customers' weekend style, thanks to the hard work and contributions from the members of our Kate Spade Saturday family who developed commercially appealing products and attracted new customers through the Kate Spade Saturday business. We are excited to apply these learnings to the Kate Spade New York collection."

Jack Spade to shut stores as part of brand repositioning

Jack Spade, Kate Spade and Company's 22-year-old menswear brand, is also shutting all 12 of its stores the announcement confirmed, as it stated that its standalone locations were no longer “relevant” to the new business model it is putting in motion to grow the brand with “controlled investments” and through “expanded distribution” with strong retail partners and its existing e-commerce platform.

The repositioning of Jack Spade will also see the collections evolving to include tailored clothing and dress furnishings, in addition to sportswear and bags, as the brand looks to become a more “complete lifestyle brand”, the company said.

Leavitt added: "We are committed to our men's heritage and believe this category is an important part of our growth story and a complement to our thriving women's business. With this new approach to distribution, Jack Spade is now better positioned to grow as we broaden our customer target."

The move comes as all the Kate Spade brands struggle against stiff retail competition, which is currently thriving on heavy promotional sales, creating smaller profit margins. It feels that by throwing its weight behind its flagship brand it will assist the company in becoming a four billion dollar business at retail, which it says it will achieve by continuing to focus on two axes of growth – geographic and product category expansion.

Leavitt stated: “By taking these actions, we will be able to accelerate the fulfilment 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."

Kate Spade partnering with Lane Crawford in China

As part of its focus on geographic expansion and partnered approach to margin expansion, Kate Spade confirmed that it has formed a joint venture with Walton Brown, a subsidiary of The Lane Crawford Joyce Group, Asia's fashion retail and brand management group, to accelerate its flagship brand in Greater China.

The 50/50 partnership will leverage the expertise of Walton Brown and the global demand for Kate Spade products to establish a strategic network of stores in key cities, enhanced by a robust organisational and marketing platform across China, Hong Kong, Macau and Taiwan, the press statement confirmed.

Leavitt said: "Walton Brown is the right strategic partner as we position Kate Spade and Company for sustainable growth, allowing us to take a holistic approach to expansion, influence consumers and leverage resources across the Greater China region.

“Walton Brown's relationships, operations and marketing expertise will help us create a cohesive foundation of stores surrounded by a vibrant ecosystem to help deepen our connection with consumers in Asia."

Thomson Cheng, president of Walton Brown, added: "Kate Spade & Company already has strong appeal and demand in the market, with even stronger growth potential. Together, we will build upon this momentum to establish a broader foundation and fuel Kate Spade and Company's scale in the region.

“Drawing upon our best-in-class expertise and network, we look forward to partnering with Kate Spade & Company to enhance its global presence during this exciting time in the Company's transformation."

Images: Kate Spade Saturday and Jack Spade

Jack Spade
Kate Spade
Kate Spade Saturday