Mark’s creating new ‘super brand’

Under the reorganization plan announced yesterday, the Calgary company will convert 144 Work World stores and eight Docker stores to Mark's Work Wearhouse outlets. The revamped stores will carry the same inhouse brands now available at 169 Mark's stores.

The Globe and Mail
November 27, 2001

Mark’s creating new ‘super brand’
Clothing chain consolidating 320 stores across country under single banner
Elizabeth Church

Mark's Work Wearhouse Ltd. Is consolidating its 320 stores across the country under a single banner, in a move that chief executive officer Garth Mitchell says is unrelated to current talks concerning the sale of the clothing chain.

"Our company is in good shape for a sale," Mr. Mitchell said in an interview yesterday. "This is not in response to an offer… . This is a normal evolution of the company."

Under the reorganization plan announced yesterday, the Calgary company will convert 144 Work World stores and eight Docker stores to Mark's Work Wearhouse outlets. The revamped stores will carry the same inhouse brands now available at 169 Mark's stores.

The change, Mr. Mitchell said, will create a new "super brand" that will be on a better footing to compete with massive U.S. retailers now in Canada such as Gap Inc., American Eagle Outfitters Inc. and Wal-Mart Stores Inc.

Mr. Mitchell said an offer made last month to buy the retailer is still on the table and other parties also have expressed interest in the company.

A special committee of independent directors is looking at all offers, he said, and should make an announcement within two weeks.

"We are under no pressure to sell the company," he said. "I don't think shareholders want to sell at any price."

The company's stock closed yesterday at $3.20, down 4 cents on the Toronto Stock Exchange.

Mr. Mitchell would not comment on the identity of the potential buyers.

Industry watchers have speculated that with the low Canadian dollar, a U.S. retailer could pick up the chain for a cheap price, but sources say at least one of the offers now being considered comes from a private business based in Western Canada.

Explaining yesterday's announcement, Mr. Mitchell said having the same merchandise in all stores will allow the company to drive better deals with suppliers and streamline distribution.

Work World stores tend to be in smaller locations and some may be remodelled and expanded to accommodate the larger selection of merchandise, he said.

The reorganization also will put an end to a pilot project with Levi Strauss & Co. to operate stand-alone Dockers stores.

Mr. Mitchell said these outlets, located in malls, will continue to carry the Dockers brand, along with the chain's private brands.

The change to a single format could take as long as 18 months to complete, he predicted.

In addition to the consolidation, Mr. Mitchell said he hopes to add 100 or more stores to the chain by 2005.

Sales have bounced back since September, he said, and cold weather in Alberta should drive up traffic in the short term there.

"Consumers are buying on the basis of need rather than on the basis of want," he said.


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