Movado to reduce U.S. wholesale distribution

Watches

Save

E-mail

Movado to reduce U.S. wholesale distribution

February 26, 2008

Similar Stories | Topics

STORIES

Movado streamlines with expense-reduction plan

Movado's net sales up 5 percent in fiscal 2008

Movado presents Kennedy Center honorees with 'Museum' watches

Movado appoints new PR VP

Time's up at Northbrook Movado boutique

TOPICS

Business | Marketing | Product Management

Paramus, N.J.—The Movado Group expects to streamline its Movado brand U.S. wholesale distribution by 35 percent—from 4,000 doors to approximately 2,600 doors—by Jan. 31, 2009, the company announced yesterday.

The closing of these least productive stores represents approximately $10 million of Movado brand sales, or less than 5 percent of the overall brand's revenue and less than 2 percent of Movado Group's consolidated revenue.

The company says it will continue to partner with retailers that it believes will support and enhance the Movado brand image and strategy.

This decision is part of the company's new unified strategy to leverage the strength of the Movado brand across all distribution channels by uniting the areas of product development, merchandising and marketing across the company's wholesale and retail channels. The company says it intends to optimize its wholesale distribution network and enhance the performance of its Movado boutiques to contribute to the brand's long-term growth.

"Managing our brand proactively, we believe there are significant opportunities to harness the power of Movado across all channels of distribution and to build on the aspirational nature of the brand," Movado President and Chief Executive Officer Efraim Grinberg said in a media release. "We developed this comprehensive strategy following a thorough analysis of our brand, our retail customers and our end-consumers. While we are cognizant of the economic environment in which we currently operate, we continue to take a long-term view of our business. We believe that by taking action now, it will allow us enhanced opportunities to generate strong sustained growth in the future."

The company has also updated its guidance for the year ended Jan. 31, 2008, based on its new brand strategy and the weak macroeconomic environment.

On a GAAP basis, Movado Group projects fiscal 2008 net sales will be approximately $559 million, which includes approximately $31 million of excess discontinued product sales. The company's updated sales guidance includes the effects of lower holiday replenishment sales and a one-time accrual of $15 million for product returns associated with the company's closing of certain wholesale doors.

Excluding the aforementioned discontinued product sales and accrual for product returns, fiscal 2008 net sales are projected to be approximately $543 million, compared with the company's previous guidance for net sales of approximately $560 million.

Movado Group projects fiscal 2009 net sales will be in the range of $555 million to $565 million. This guidance reflects management's expectation of a continuing weak macroeconomic environment. It also includes an approximate $0.20 per fully diluted share negative impact related to expected wholesale door closings, certain expenses related to the company's ERP implementation and severance costs to be completed as part of the company's Movado brand strategy.

Movado Group Inc. designs, manufactures and distributes Movado, Ebel, Concord, ESQ, Coach, Tommy Hilfiger, Hugo Boss, Juicy Couture and Lacoste watches worldwide, and operates Movado boutiques and company stores in the United States.

For more information about Movado, visit its Web site, Movadogroupinc.com.

Save

E-mail

More Watches

Study: More young adults going without watches

Paso Robles, Calif.--A new study from MVI Marketing Ltd.'s Jewelry Consumer Opinion Council (JCOC) finds that while many young adults in the 18-24 age group do own a watch, many are instead using cell phones, iPods and other digital devices to tell time. Read More

Watch Dealers Network launches price-list resource

Longines names Stefanie Graf new ambassador

More Watches

More Like This

Movado streamlines with expense-reduction plan

August 08, 2008 | National Jeweler Network

Movado's net sales up 5 percent in fiscal 2008

March 28, 2008 | National Jeweler Network

Movado presents Kennedy Center honorees with 'Museum' watches

December 10, 2007 | National Jeweler Network

Movado appoints new PR VP

July 06, 2007 | National Jeweler Network

Time's up at Northbrook Movado boutique

April 21, 2007 | National Jeweler Network

TOPICS

Business | Marketing | Product Management

Design Portfolio

BROWSE

Video

Retailer Toolbar

LoupeIt!
A search engine designed specifically for the jewelry industry where every return is relevant to the retail jeweler.

Newsletters
Topic-specific newsletters that deliver the latest news on jewelry, diamonds, wholesale operations and high-volume buying directly to your in-box.

ReaderConnect
Supplier information presented with every article, bringing you related, actionable content on every topic.

Yellow Pages
A comprehensive listing of associations, organizations, suppliers and services for the jewelry industry.

Classifieds
A comprehensive listing of job postings, product offerings and other materials for sale for the jewelry industry.

CustomerConnect
The most sophisticated suite of marketing services available for jewelry retailers, from Internet tools to data marketing.