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J. Crew Group F4Q07 (Qtr End 2/2/08) Earnings Call Transcript

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2008-03-11 17:02:08.0

Tags: J Crew Group Inc.

Question-and-Answer Session

Operator

(Operator Instructions) Our first question comes from John Morris with Wachovia. Please proceed with your question.

John Morris - Wachovia

Congratulations on a great performance in a really tough environment. First question is Mickey, if you can talk a little bit about the -- you know, in terms of merchandising at J. Crew, where you see the opportunity in the Spring season compared to last year. And maybe if you can shed a little bit of light for us in terms of how the reporting of business has changed with Jeff’s departure and your thoughts on that. Thanks.

Millard S. Drexler

First, in terms of the recording -- what was that, the reporting of the business?

John Morris - Wachovia

Yeah, just you know, with Jeff’s departure, what changes in terms of reporting lines and how does it affect the day-to-day business with what you are going?

Millard S. Drexler

Really, actually nothing much has changed. Jenna Lyons has been creative director. We have one Margot Fooshee reports into me and Todd, head of men’s design, reports to Jenna. Catalog reports directly to Jenna and John, head of presentation, reports to Jenna. So it’s been very seamless. It kind of creates one less layer of management, so that’s really all there is to say about that.

Regarding Spring, and really regarding longer term, always women’s and men’s pants. And as you’ll look at our stores, you’ll start to see much more definition on that. We were in our Garden State store today, which everyone -- a lot of people know is our set-up store, and we’ll continue to reinforce dominant categories that J. Crew wants to be authoritative and the best in.

Now of course, part of that is forecasting what’s moving upward and what’s moving outward, so to speak. Jewelry you’ll see as a major impact beginning in the stores and that’s again -- and I don’t like to talk only about Spring. The thing we look at in any business is can it present a long-term annuity in our company? Can it continue to dominate and force others to shop in our stores, let’s say our competitors’ customers, and continue to improve the quality and design and detail of our clothes and continue to improve the service but always protecting opening price points.

So if you look at this spring and you look at the stores, which we just looked at the three-week set-up today, you’ll see that we are continuing to impact that. The women’s suiting business, we’ve had -- we’ve set them up differently right now in the stores. We’ve had a very quick training program on that to intensify the knowledge of suits, and also remember it’s a higher price point on average so it’s something that will help us.

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