As New York-based fashion house Kate Spade & Company looks to accelerate its growth in China, it has turned to Lane Crawford’s Walton Brown.
Walton Brown offers full-channel distribution to fashion brands looking to target Chinese middle-class consumers. Walton Brown’s first task was taking over the expansion of Juicy Couture, which has 90 current points of sale in China.
The partnership with Kate Spade will see Walton Brown establishing a network of stores in key cities, which will be enhanced by Walton Brown’s organizational and marketing platforms in China, Hong Kong, Macau, and Taiwan.
Kate Spade & Company CEO Craig A. Leavitt said, “This partnership is a pivotal next step as Kate Spade & Company continues to advance along a key axis of our growth strategy — geographic expansion — while also continuing our partnered approach to margin expansion.”
“Walton Brown is the right strategic partner as we position Kate Spade & 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,” Mr. Leavitt added.
Earlier this year, Kate Spade bought out Globalluxe for $34 million to regain full control of its products in Asia. However, the company seems to believe that Walton Brown can take the company further than it could itself.
Walton Brown Thomson Cheng said, “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 & 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.”
As part of the deal, Kate Spade announced a share purchase agreement with E-Land Fashion China Holdings Limited, its current partner in China, to buy back E-Land’s 60% stake in Kate Spade China for $36 million.
The partnership with Walton Brown will unite all of Kate Spade’s existing businesses in China and Hong Kong, Taiwan, and Macau under one structure. Under the agreement, Kate Spade Hong Kong and Walton Brown will each own 50 percent of Kate Spade China and Kate Spade HMT. Both companies will run the business in cooperation for an initial term of 10 years. The new venture sees long-term potential in the region for 100 stores.
image credit: kate spade