Bebe takes it to the next level
Steve’s breakdown: Bebe has decided to license its brand domestically and globally. This has brought in $35 million and a much larger audience. Right now they do advertising in-house but with this extra cash & larger audience, they could use your help.
LOS ANGELES, CA: Bebe Stores Inc. is building upon efforts to turn itself around and boost its international presence.
The specialty apparel retailer, which launched a China growth plan in 2015, has entered into a joint venture with Bluestar Alliance LLC to license its brand domestically and globally. Bebe has received $35 million in connection with the formation of the joint venture.
“Over decades we built one of the great global brands in the women’s fashion world,” said Manny Mashouf, founder, chairman of the board and CEO of bebe, “However, the value of our brand, its reach and potential is clearly not reflected in investors’ current perception of the company and its valuation. The strategic decision to aggressively pursue a licensing strategy allows us to capitalize on the value of our brand in all categories and channels on a global scale. We have seen significant demand from prospective licensees and expect to generate long-term, committed royalties.”
Under the terms of the agreement, Bebe has contributed its trademarks and related intellectual property to a newly formed joint venture and has received just over 50% of the joint venture. Bluestar has contributed the $35 million that was then paid to Bebe and has received just under 50% of the joint venture. Bluestar will leverage its existing brand management organization and infrastructure to develop a wholesale domestic and international lifestyle licensing business for the joint venture and will manage its day-to-day operations.
In August 2015, Bebe signed a five-year strategic cooperation agreement with Shanghai-based brand agency Longgoal LLC to open between 60 and 150 Bebe stores, shop-in-shops and third-party retailers in Greater China, Hong Kong, Macau and Taiwan. The first store is expected to open in summer 2016.
In February 2016, on the heels of a second quarter loss, Bebe embarked on a restructuring plan that included laying off 45 employees and replacing then-CEO Jim Wiggett with founder Mashouf. The company also had former COO Walter Parks return as president and COO, and also act as interim CFO, replacing CFO Liyuan Woo.