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J. Crew's Problems Go Far Beyond One Unpopular Cardigan

Illustration for article titled J. Crews Problems Go Far Beyond One Unpopular Cardigan

Over the summer, J. Crew posted terrible quarterly results and tried to pin much of the blame on a terrible sweater named Tilly. But it’s quite clear the company’s troubles run deeper, and they’re not going away.

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The retailer just released its Q3 numbers, and they weren’t pretty, says Quartz. Sales at the J. Crew brand fell 9 percent, and revenues for the company as a whole slipped 6 percent to $619.4 million. (Madewell sales increased, though!) If that wasn’t dismal enough (it was), there’s the matter of the “goodwill writedown.” The Wall Street Journal walks you through it:

Technically, J. Crew wrote down the value of the goodwill associated with its stores by 57%, or $536 million, while leaving the portion assigned to its online operations unchanged. It also wrote down the value of the J. Crew brand name by $145 million.

Goodwill broadly refers to a company’s intangible assets, like reputation and customer loyalty, and often reflects the premium paid for a company in an acquisition.

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As Bloomberg explains, the move is essentially an admission the J. Crew name ain’t worth what it once was. Nor is it surprising, after months of coverage of missteps ranging from specific unsuccessful items to a general shift away from affordability. The New York Times summed up several problems back in June: “Boxy styles. Strange sizing. And customers who loathe paying full price when many items are either quickly discounted or can be bought online for less.”

However, let the record reflect that fucking sweaters aren’t entirely innocent, here: “An unseasonably warm fall hasn’t helped anyone who sells sweaters—look no further than Banana Republic, which also suffered a 12% dip in comparable sales this past quarter,” Business Insider notes.


Contact the author at kelly@jezebel.com.

Photo via AP Images.

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DISCUSSION

theancientbooer
The Ancient Booer

Dear J. Crew,

I used to occasionally shop in your store and almost always found something I liked: a cute dress, a fab sales rack, great work basics, etc. For the past couple years, all I have seen are $80 tissue tees, uninspired dresses, tops with weird bejeweled crystal bits, and boring sweaters. I bought one of those damned tissue tees (clearance rack) and a hole appeared after 3 washings.

Stop selling overpriced cheaply made clothes. Start designing inspired clothes. Go back to the quality you had in the 1990s. Hell, I still own a J Crew pea coat I received as a gift when I was in high school in the mid-90s (yay for classic style).

Signed, a former fan