Department store route appeals to Mango

By: Joe Ayling - 7 December 2009 12:55

Last week's announcement that US department store retailer JC Penney will play host to European fast fashion chain Mango shows that collaboration is key to international expansion.

The deal includes an initial rollout in up to 75 JC Penney stores by Autumn 2010, followed by expansion into 600 stores the following year.

It is an unconventional way for Mango to grow its relatively modest presence in the world's top retail market, as the Spanish retailer has previously grown its global network through franchise deals and owned-stores.

Despite having more than 1,300 stores in 94 countries, Mango has only 12 stores in the US and knows there is only one way to achieve the same scale of expansion across the Atlantic - collaboration.

Last week's deal, which focuses on the MNG by Mango, offers immediate exposure for the brand to cities across the US, and also to JC Penney's online audience.

It is big business for JC Penney too, which is making Mango the centrepiece for a new 'contemporary' area in stores, and piloting the fast fashion concept to its shoppers.

There are also operational synergies, as the companies said last week: "The partnership will utilise Mango's talented design team and fast fashion sourcing with JC Penney’s sophisticated logistics network and industry leading planning and allocation tools to deliver compelling assortments twice monthly."

Therefore, partnerships with department stores provide an easier gateway into the US market for global fashion brands than standalone stores. Mango will be able to tell its peers whether the returns are as lucrative in around two years time.

By Joe Ayling, news editor.

Comments on this blog post

Wow, this is very unexpected of Mango. I wouldn't have guessed that they would go the department store route in expanding their business in the States. It's kind of hard to predict how lucrative this would be for Mango, although I feel that this collaboration will benefit JC Penney tremendously.

DISTRIKMODE, United States