Men’s Wearhouse Pursues Possible Purchase of Allen Edmonds

[Willin]



Men -- I thought I'd join your thread. Below is a link to an article in the Milwaukee Journal Sentinel, it's has good and broader information for you, and the reporter quoted me accurately. We will indeed maintain -- even continue to improve toward the endless pursuit of perfection -- our quality.

Best wishes,
Paul

http://www.jsonline.com/business/me...-for-allen-edmonds-b99126284z1-228843321.html

Don't you worry of the inevitable destruction of your brand when it is acquired by Men's Warehouse? Under no circumstance would it improve the image of the company. The only thing it will achieve is enriching the shareholders (PE firm). I don't mean this maliciously.

Thanks for stopping by, regardless.

 

[Caustic Man]

All in all, I think among discerning shoe shoppers, association with Men's Wearhouse is a bad idea...

 

[rbarthel]

Even if Paul's claims about quality holds true, I couldn't see spending money at a company owned by Men's Wearhouse when there are so many other great shoe companies with products at roughly the same price point or just a little bit more.

 

[chogall]



Even if Paul's claims about quality holds true, I couldn't see spending money at a company owned by Men's Wearhouse when there are so many other great shoe companies with products at roughly the same price point or just a little bit more.

Whom?

AE is special because it sits at a price point that no one else could compete. Similar quality imported shoes needs to have at least $400 msrp to break even or profitable...

 

[rbarthel]

Whom?

AE is special because it sits at a price point that no one else could compete. Similar quality imported shoes needs to have at least $400 msrp to break even or profitable...

I can only speak for myself but i'd consider Alden's premium over AE an acceptable cost for not doing business with Men's Wearhouse.

 

[brokencycle]

While the MJS article is positive, the idea of Men's Wearhouse buying is scary. There just doesn't seem to be a good strategic fit for the two companies. The customer segmentation is very different, and the overall focus of the two businesses are different, and I think the Men's Wearhouse brand will devalue Allen Edmonds simply because Men's Wearhouse is a low-end product now trying to sell a much higher end product -- not dissimilar how brands can destroy themselves by offering diffusion lines.

For that reason, I just don't see Men's Wearhouse offering much more money than other potential buyers.

Hopefully whoever buys will keep the company moving in the right direction.

On that note, as styleforvm can we pool a couple hundred million to buy AE?

 

[Willin]



While the MJS article is positive, the idea of Men's Wearhouse buying is scary. There just doesn't seem to be a good strategic fit for the two companies. The customer segmentation is very different, and the overall focus of the two businesses are different, and I think the Men's Wearhouse brand will devalue Allen Edmonds simply because Men's Wearhouse is a low-end product now trying to sell a much higher end product -- not dissimilar how brands can destroy themselves by offering diffusion lines.

For that reason, I just don't see Men's Wearhouse offering much more money than other potential buyers.

Hopefully whoever buys will keep the company moving in the right direction.

On that note, as styleforvm can we pool a couple hundred million to buy AE?

It's simply a play for the PE firm to cash out while the getting is still good and they have a suitor. They couldn't give a damn who they sell to. The CEO probably knows the writing is on the wall for the AE brand if they sell to MW but he has little say in the matter.

 

[JLibourel]



I can only speak for myself but i'd consider Alden's premium over AE an acceptable cost for not doing business with Men's Wearhouse.

That raises the question of whether MW would become the exclusive retailer of A-E. For instance, as of a few years ago (not sure whether this is still true), the amount of shoes A-E sold to Nordstrom alone equalled Alden's total production. Would the new ownership be willing to give up that and much other business? And what about all the A-E company stores and outlets? Somehow, I think the management of MW are shrewd enough to realize that the typical A-E customer and the typical MW customer are two rather different animals.

 

[brokencycle]



It's simply a play for the PE firm to cash out while the getting is still good and they have a suitor. They couldn't give a damn who they sell to. The CEO probably knows the writing is on the wall for the AE brand if they sell to MW but he has little say in the matter.

Yes, but businesses with a strategic interest are willing to pay a premium. My point is that MW probably doesn't have a strong enough strategic play to buy AE to justify much of a premium, so there is a possibility someone else will offer more.

That raises the question of whether MW would become the exclusive retailer of A-E. For instance, as of a few years ago (not sure whether this is still true), the amount of shoes A-E sold to Nordstrom alone equalled Alden's total production. Would the new ownership be willing to give up that and much other business? And what about all the A-E company stores and outlets? Somehow, I think the management of MW are shrewd enough to realize that the typical A-E customer and the typical MW customer are two rather different animals.

They are; however, there are two problems in that scenario.

1. Brands that focus on price or cost containment tend not to do well when they acquire higher end brands. How many times have we seen that?

2. Companies that tend to try doing two different retail strategies often don't do well with the non-primary one. As an example, Sam's Club has done okay but not great while Costco has boomed.