Guess? wants you to get in its jeans and other attire and accessories. Founded to make flattering designer jeans, the company manufactures trendy, upscale apparel and accessories for men, women, and children under brands GUESS, GUESS Kids, Baby GUESS, and GUESS by MARCIANO, among others. Its trademark sexy ads, featuring the likes of Claudia Schiffer, are designed in-house. Guess? operates a noteworthy 1,640 stores worldwide. It directly operates more than 870 stores and concessions in the US, Canada, Europe, the Middle East, and Asia. Another 770 stores and concessions are run by licensees and distributors in the same markets. To get more bang from its brand, Guess? licenses its name for eyewear, footwear, jewelry, and watches.
Guess? divides its business into five reportable segments: Europe, Americas retail, Asia, Americas Wholesale, and Licensing.
The Europe segment comprises its wholesale and retail operations in Europe and the Middle East. The Americas Retail segment consists of retail and e-commerce operations in North America and its retail operations in Central and South America. The Asia segment includes the company's wholesale and retail operations in Asia. The Americas Wholesale segment focuses on both wholesale operations in North America and export sales to Central and South America. And lastly, the Licensing segment comprises Guess?'s worldwide licensing operations, which have 15 domestic and international licenses.
The Asia and Americas Wholesale segments accounted for 11% and 7%, while Licensing accounted for the remaining 5%.
The company's retail operations in the Americas account for 44% of its revenue. Guess? is also a wholesaler to major department stores, including
, specialty shops, and upscale boutiques.
Europe accounts for around 33% of total net sales.
Guess and its licensees and distributors operate in 97 countries worldwide. It directly operates roughly 870 retail stores in the Americas, Europe and Asia. The Company's licensees and distributors operated roughly 770 additional retail stores worldwide.
Sales and Marketing
Besides its brick-and-mortar retail operations, Guess? wholesales its apparel and accessories to mass merchandisers (Macy's is its biggest customer), specialty shops, and upscale boutiques worldwide. The company also sells products online and through licensees and distributors in South America, Europe, Asia, Africa, Australia, and the Middle East.
The company's retail website is operational in the US, Canada, Mexico, Europe, South Korea and China.
The company uses direct-to-consumer, wholesale and licensing distribution channels to sell its products.
In mid-2016 Guess launched Guess Music, a music platform, as a way of tying together music and fashion. It has recruited pop stars Ariana Grande and Nicki Minaj as part of its promotional push for its new athletic line of clothing.
Revenue has been falling since 2012, and fell a further $213 million, or 9%, in 2016 to $2.2 billion. A significant amount of the fall was a result of unfavorable foreign currency fluctuations, accounting for which revenue was down a more measured 0.9%. Net store closures and negative store sales hit revenue in the Americas by 1.6%. The store base in the Americas decreased by an average of 26 stores on prior year, resulting in a 4.1% fall in square footage.
Net increase also fell, down around 13% to $81.8 million, in line with the fall in revenue.
Cash from operating activities rose however, and was 17% higher than prior year at $179.4 million as a result of changes in accounts payable and accrued expenses.
Amid falling sales, Guess? has been changing its mix of stores. In 2016, the company opened 120 new stores worldwide, while closing 149. Working with partners, the company opened 49 stores in Europe and the Middle East, 49 in Asia, 13 in the U.S. and Canada, and nine in South America. At the same time, the company closed 51 stores in Europe and the Middle East, 55 in Asia, 38 in the US and Canada, and five in South America.
Guess? opened its first direct store in Japan in the first part of its 2015 fiscal year.
The company has introduced a new athletic line of clothing, fronted by pop star Ariana Grande, marking the company's entry into the "athleisure" -- sportswear worn in non-sports settings.
In fiscal 2016, the Company changed the names of its 'North American Retail' and 'North American Wholesale' segments to 'Americas Retail' and 'Americas Wholesale' to better reflect that these segments are inclusive of its operations in North America as well as Central and South America.