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Liz Claiborne Reorganizes

Two business units will be in effect; five group president positions have been eliminated

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Liz Claiborne Inc. (New York) announced it would reorganize into two units, effective July 9, 2007, and has eliminated the five group president positions.

One unit would control the company’s retail-based “direct” brands, including Juicy Couture, Lucky Brand and Sigrid Olsen, as well as the company’s outlet and e-commerce businesses. The other unit would deal with the wholesale “partnered” brands like Liz Claiborne, Dana Buchman, Ellen Tracy, and DKNY jeans and active wear.

Liz Claiborne president Trudy Sullivan will lead the partnered brands division which encompasses global oversight of Liz Claiborne/Claiborne, Monet and the moderate department store brands; C&C California, Dana Buchman, Ellen Tracy, Enyce, Laundry by Design, Mac & Jac/Kensie and Prana; JC Penney, Kohl's and Sears; DKNY Jeans and DKNY Active; and cosmetics and fragrances. She will continue to report to ceo William McComb.

Jill Granoff, formerly group president, direct-to-consumer, will be executive vp, direct brands, responsible for global oversight of Juicy Couture, Lucky Brand and Sigrid Olsen, as well as the company's outlet and e-commerce operations. She will also report to McComb. The company plans to announce leadership for the Kate Spade business shortly, which will also report to McComb.

According to Daily News Record, one of the group presidents, Karen Murray, has left the company.

Juicy Couture, Kate Spade, Lucky Brand and Mexx will operate under brand-centric, vertical organizational structures. Under this alignment, these four brands will have their own distinct marketing, licensing and accessories functions while managing their specialty retail, outlet, catalog/e-commerce and wholesale businesses. The founders of Juicy Couture and Lucky Brand Jeans — Pamela Skaist-Levy and Gela Taylor (Juicy Couture); and Gene Montesano and Barry Perlman (Lucky Brand) — will continue to be actively involved with their respective brands.

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The company will announce further strategic initiatives at its annual meeting July 11. Sullivan said the wholesale and retail brands had distinct needs, including different growth prospects, capital requirements and cultural profiles.

Last month, the company posted a 65 percent drop in quarterly profit and gave a weak full-year outlook. It has been struggling due to the squeeze on moderate apparel brands, falling demand for its traditional upscale brands and the consolidation of department stores that increasingly promote their own private brands. The acquisition of Kate Spade and Lucky Brand has not offset the decline of its larger, more traditional brands. The company said the new structure would allow it to prioritize and better capitalize on the growth opportunities of Juicy Couture, Kate Spade, Lucky Brand and Mexx.

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