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Abercrombie & Fitch facts for kids
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Abercrombie store on Fifth Avenue, Manhattan
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| Public | |
| Traded as |
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| Industry | Retail |
| Founded | June 4, 1892 in Manhattan, New York City, U.S. |
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| Headquarters |
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U.S.
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Number of locations
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854 (Feb. 2020) |
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Area served
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Worldwide |
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Key people
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| Revenue |  US$3.71 billion (2021) |
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Operating income
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US$355.18 million (2021) |
| US$263.01 million (2021) |
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| Total assets |  US$2.93 billion (2021) |
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Number of employees
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44,000 (Feb. 2020) |
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Abercrombie & Fitch Co. (A&F) is an American lifestyle retailer that focuses on contemporary clothing. Its headquarters are in New Albany, Ohio. The company operates three offshoot brands: Abercrombie Kids, Hollister Co., and Gilly Hicks. As of February 2020, the company operated 854 stores across all its brands.
History
The Marquess of Camarasa wearing Abercrombie & Fitch hunting equipment in the Arctic Circle, 1921
The original Abercrombie & Fitch was founded in 1892 in New York City by David T. Abercrombie as an outfitter for the elite outdoorsman. Ezra Fitch—a wealthy lawyer, real estate developer, and devoted Abercrombie customer—bought a significant stake in the business in 1900. In 1904, it was incorporated and renamed "Abercrombie & Fitch Co." Fitch eventually bought out Abercrombie's share of the business, becoming its sole owner from 1907 to 1928. The company was an elite outfitter of sporting and excursion goods, particularly noted for its expensive shotguns, fishing rods, fishing boats, and tents. It outfitted Theodore Roosevelt's safari and Admiral Richard E. Byrd's expedition to Antarctica. Ernest Hemingway was also a regular customer. Following Hemingway's death, his wife placed several of his guns on consignment with the company.
By the 1970s, A&F was struggling to compete with lower-priced competitors while trying to maintain its high-end image. It was known for holding an extensive inventory of lavish items, but high operating expenses forced A&F to shed its highest priced items, such as an $18,000 (equivalent to $135,640 in 2022) gold and onyx chess set. Cash flow problems forced the company to also cut its inventory of moderately priced products.
In 1976, Abercrombie & Fitch filed for Chapter 11 bankruptcy protection. In 1977, the company closed its New York flagship store at Madison Avenue and East 45th Street.
While Abercrombie & Fitch went out of business during its bankruptcy, the brand survived: in 1978, Oshman's Sporting Goods, a Houston-based retail chain, bought the defunct firm's name and mailing list for $1.5 million (equivalent to $7 million in 2022). Oshman's relaunched the company as a mail-order retailer specializing in hunting wear and novelty items. Retail stores were also opened in Beverly Hills, Dallas, and (by the mid-1980s) New York City.
In 1988, Oshman's sold the brand and its operations to Columbus, Ohio-based The Limited (parent company of several retail clothing chains, including Victoria's Secret). Under The Limited, which later rebranded itself as L Brands, A&F gradually shifted its focus to young adults, was later spun off as a separate, publicly traded company, and eventually grew into one of the largest apparel firms in the United States.
Mike Jeffries became CEO in the 1990s and refocused the brand on the teen customer. In 1998, the company launched a children's product line, Abercrombie Kids, for 7-14 year olds. In 2000, A&F launched its Hollister Co. subsidiary, "a new concept focused on the optimistic, laidback California lifestyle".
2007–present
The company overhauled its merchandise mix and closed several underperforming stores. Longtime CEO Michael Jeffries resigned in December 2014, after 22 years with the company. Fran Horowitz took over as CEO in February 2017.
To combat competition from more downscale fast-fashion rivals like Forever 21 and H&M, A&F announced light changes to its image. A&F pledged to focus more on customer service. A&F also changed the job title of store employees from "models" to "brand representatives", and allowed a less tightly controlled, more individualistic dress code. Additionally, A&F declared that "brand representatives" would focus more on customer service (by offering to help serve customers), versus the past reputation of displaying aloofness toward them. In 2015, the company signaled that it would begin implementing these changes. By that May, store models were no longer forced to wear Abercrombie-branded clothes.
According to recent reports from Q1 2021, it was the "group’s best second-quarter operating income and margin since 2008, with sales exceeding pre-pandemic levels."
Market value
In April 2017, the company was described by Standard & Poor's as having a market value of $650 million and about $420 million cash on hand. In May 2017, the company was in talks to sell itself. Potential buyers included rivals Express (a fellow former L Brands subsidiary) and American Eagle Outfitters, and private equity firm Cerberus Capital Management. However, negotiations failed by early July, contributing to a 21% drop in A&F's stock price.
Headquarters
The company's headquarters (aka "The Home Office") is located outside Columbus, Ohio in New Albany, Ohio, a small farm town, expanded into a wealthy community planned and developed by L Brands founder Les Wexner. The Home Office was designed as a campus and internally referred to as such, sitting on 350-acres and consisting of 11 two-story buildings (some connected by skybridge). The company's two merchandise distribution centers (1 million square feet each) are located on campus to help ensure brand protection. Also on campus are model stores, one for each of the company's brands, where store layouts, merchandising and atmosphere are developed and tested. In January 2017, A&F announced it was terminating 150 Home Office employees.
The company also has a European office in Mendrisio, Switzerland.
Marketing, advertising and brand identity
A&F was once known for its racy marketing photography by Bruce Weber. It was black and white and set outdoors. The company promotes its casting sessions, models, and photo shoots in the "A&F Casting" feature on its website. The website also provides a gallery of current photography. Framed copies at company stores will sometimes name the model and store.
The company's brand image is heavily promoted as an international near-luxury lifestyle concept. The company began cultivating a far more upscale image after the 2005 opening of its Fifth Avenue flagship store alongside Prada and other upscale retailers. Having for years used high-grade materials in the manufacture of its merchandise, and pricing them at "near-luxury" levels, the company introduced the trademark Casual Luxury as a fictional dictionary term with multiple definitions such as "[using] the finest cashmere, pima cotton, and highest quality leather to create the ultimate in casual, body conscious clothing," and "implementing and/or incorporating time honored machinery ...to produce the most exclusive denim..." This upscale image has allowed it to open stores in international high-end locations and further promote the image by pricing its merchandise at almost double the American prices.
Echoing the entertainment-based, high-class-aspirational approach L Brands' Les Wexner used to fuel the 1980s-2010s growth of Victoria's Secret, Abercrombie CEO Mike Jeffries has called A&F's brand image a "movie" because of the "fantasy" that plays out in-store.
Following a lighter earnings announcement in August 2014, A&F shifted its business strategy to a degree to trendier styles and faster production processes, effectively embracing fast fashion while retaining its upmarket prestige in contrast to its competitors.
In 2018, Abercrombie shifted its target market to an older demographic to include not just teenagers but young adults.
Store staff
The company is noted for its use of "brand representatives" (fka "models") as in-store customer service staff. Previously, the models were required to buy and wear only A&F clothing at work. However, after a 2003 settlement with California state labor regulators, A&F allowed brand reps to wear any logo-free clothing, as long as it corresponded with the season and A&F's style. The California settlement also provided $2.2 million to reimburse former employees for their forced purchases of company-branded clothing. An "Impact Team" was created in 2004 to control merchandise within each store and strictly maintain and enforce company standards. Bigger and higher volume stores have a "Full Time Stock" who trains Impact associates, processes shipments, maintains stock room standards, and can even act as a manager if the store is short on management staff. Stores' general manager and assistant managers are responsible for forms, lighting, photo marketing, fragrance presentations, and ensuring brand reps comply with the company's "look policy".
Products
Women's Wear Daily calls the company's clothing classically "neo-preppy", with an "edgy tone and imagery". The company's fashions have a reputation for luxury, with the majority of designs trend-driven. There is heavy promotion of "Premium Jeans". In early 2010, the company introduced a leather handbag collection inspired by designs from Ruehl.
Its prices are recognized as the highest in the youth-clothing industry. Internationally, prices are almost double those in American stores. Retail analyst Chris Boring warns that the company's brands are a "little more susceptible" should recession hit, because their specialties are premium-priced goods rather than necessities. Indeed, as the late-2000s recession continued, the company took a hit financially for its refusal to lower prices or offer discounts. It argued that doing so would "cheapen" its near-luxury image. Analyst Bruce Watson warned that the company risked finding itself transformed into "a cautionary tale of a store that was left by the wayside when it declined to change with the times". The company's year-to-year revenue, a key indicator of a retailer's health, rose 13% in September 2010.
The company has carried men's fragrances Fierce, Colden, and has re-branded the original cologne Woods (Christmas Floorset 2010). Women's fragrances have included 8, Perfume 41, Wakely, and Perfume #1. Fierce and 8 are the most heavily marketed fragrances, as they are the signature scents of the brand overall.
Brand protection
Because of extensive counterfeiting of its products, the company launched a brand protection program in 2006 to combat the problem worldwide (focusing more on China, Hong Kong, Japan and Korea) by working with law enforcement globally. The program is headed by a former FBI Supervisory Special Agent who was part of the FBI's Intellectual Property Rights program, and covers all the company's brands. The company says that the program "will improve current practices and strategies by focusing on eliminating the supply of illicit Abercrombie & Fitch products."
Stores
The Modern Canoe store is located at The Mall at Millenia in Orlando, Florida with wooden louvers (featuring the Spring Break 2007 marketing campaign picture).
The exterior of the contemporary store design features white molding and formerly black louvers. From 2013 to 2014, the louvers were removed from all locations except from certain flagship stores which had windows above street level. The company stated that the louvers were removed in an effort to eliminate the exclusive atmosphere from stores and to experiment with window marketing. The currently featured marketing image directly faces the entrance. The interior is lit with dim ceiling lights and spot lighting. Electronic dance music meant to create an upbeat atmosphere may be played at sound levels as high as 90 decibels, exceeding the corporate policy of 84 decibels and comparable to heavy construction machinery and harmful to the ears.
The company operates 854 stores across all four brands. The company's brand has 278 locations in the United States, 5 in Canada (2 in Alberta, 2 in Ontario, and 1 in British Columbia). The company currently operates 70 full-line stores abroad and 10 outlet stores across 16 countries.
International expansion
The Abercrombie & Fitch flagship store in Ginza, Tokyo, Japan – the first one in Asia
The company's brand is believed to have reached its maximum growth potential in the American market. International expansion began in 2005, with the long-term goal of opening flagships for A&F (and eventually all its brands), in high-profile locations worldwide "at a deliberate pace". After initially opening at a deliberately slow pace, the company began to accelerate international expansion for its namesake and its Hollister Co. brand in 2012.
The company's first non-U.S. stores opened in Toronto and Edmonton in 2005, and then expanded to other major cities in Canada. The company first entered the European market in 2007 with the opening of its flagship London store at 7 Burlington Gardens, Savile Row. Since then, the company has opened stores in Milan, Copenhagen, Paris, Madrid, Brussels, Dublin (now closed) and other major cities in Europe, including six stores in Germany. The company opened its first Asian flagship store in Tokyo in 2009, followed by Fukuoka, Singapore, Hong Kong and Seoul. The company would primarily focus on the Chinese and Japanese markets where luxury consumption is high. The company has also entered a franchise agreement with Grupo AXO to open retail stores in Mexico by 2015. In 2015, the company entered the Middle Eastern market with the opening of its flagship store in Kuwait. Since then the company has opened locations in Dubai and plans to expand deeper into the Middle East with stores in Saudi Arabia, Qatar, Bahrain, and Oman.
Remembrance poppy prohibition in the UK
In November 2010, the Southampton, England, store prevented 18-year-old Harriet Phipps from wearing a remembrance poppy, which is worn as part of the Remembrance Day commemorations in the United Kingdom and Canada every November. The official reason for the refusal was reported to be that the poppy is not considered part of the corporate approved uniform, and is therefore prohibited. The ban drew criticisms, and on November 8 the company posted on its Facebook page the following statement: "As an American company that has been around since 1892, we appreciate the sacrifices of the British and American servicemen/women in the World Wars and in military conflicts that continue today. Our company policy is to allow associates to wear a poppy as a token of this appreciation on Remembrance Day. Going forward, ...we will revisit this policy to the days/weeks leading up to Remembrance Day."
Abercrombie Kids shop on Savile Row
In 2012, the company announced plans that it would open its Abercrombie Kids shop at No. 3 on Savile Row, next door to Gieves & Hawkes. The plans drew criticism and opposition from the tailors of the Row, who were already unhappy about the presence of its main store on Burlington Gardens at the end of the Row to begin with. This eventually led to a protest organized by The Chap magazine on April 23, 2012. During the consultation period, objections were lodged to Westminster City Council and in February 2013 the Council rejected many of the company's proposals for the store, and branded the entire plans "utterly unacceptable." A&F appealed, managed to overcome the obstacles and opened the store in September 2014. The following year, the company was subject to nearly £16,000 in fines and legal costs when it was ruled that changes it had made in the Grade II-listed building were illegal.
Abercrombie opens college campus stores
In an attempt to more effectively reach the brand's ideal "college-age" customer, the company tested two experimental campus stores in August 2018, both of which have since closed.
Brands
The company has operated four concept brands apart from its namesake over the years; they have been referred to as subsidiaries, but operate as divisions under the company's umbrella.
- Abercrombie Kids
- Prep-school by Abercrombie & Fitch Themed as "classic cool" for kids 7 through 14, this is the children's version of Abercrombie & Fitch.
- Hollister Co.
- Southern California by Abercrombie & Fitch Themed after "SoCal" for teenagers 14 through 18, with significantly lower prices than its parent brand.
- Gilly Hicks
- The cheeky cousin of Abercrombie & Fitch Themed after "Down Under" Sydney, offers underwear, loungewear and activewear for women 18 and up. Currently sold primarily within Hollister Co. stores and e-commerce channels with a small number of individual store locations.
- Ruehl No.925
- Post-Grad by Abercrombie & Fitch Themed after a fictional Greenwich Village heritage, offered clothes for 22 through 35 post-grads. Closed in 2010.
- Social Tourist
- “Social Tourist is the creative vision of Hollister, the teen brand liberating the spirit of an endless summer, and social media personalities Charli and Dixie D’Amelio. The lifestyle brand creates trend forward apparel that allows teens to experiment with their style, while exploring the duality of who they are both on social media and in real life.“
Privacy concerns
In February 2019, TechCrunch reported that the Abercrombie & Fitch mobile app in the iOS App Store was using session-replay functionality to record users' activities and send the data to Israeli firm Glassbox without the users' informed consent, compromising users' privacy and contravening the rules of the iOS App Store.
See also
In Spanish: Abercrombie & Fitch para niños
- Companies listed on the New York Stock Exchange (A)
- List of S&P 600 companies
- Lifestyle brand
- Retail apocalypse
- List of retailers affected by the retail apocalypse