K Swiss President & CEO Larry Remington on acquiring Supra & Kr3w
K•Swiss Global Brands (KSGB) announced today the acquisition of ONE-Distribution, parent company to skate-inspired apparel brand KR3W and SUPRA Footwear. KSGB acquired the Fountain Valley, CA-based business from a group of shareholders, including Bertram Capital, a San Matteo, CA-based private equity firm and a small group of private investors, including ONE-Distribution founders Angel Cabada and Scott Bailey who will support the brands in a consulting capacity. The price was not disclosed.
K Swiss has named Robert "Cape" Capener as Brand President of both Supra and KR3W. Capener hails from former senior executive positions at Adidas, Reebok, and No Fear. ONE-Distribution currently has offices in Fountain Valley, CA, Barcelona, Spain, Sydney, Australia and Dongguan, China, and has five multi-brand retail stores in Los Angeles, New York City, Mexico City, Paris and Tokyo. K Swiss is globally headquartered in Westlake Village, CA with offices in Toronto, Fountain Valley, Haarlem, Lyon, Barcelona, Sydney, Dongguan, Hong Kong and Tapei. KSGB conducts business in more than 100 countries worldwide and will operate up to 500 proprietary retail stores globally by year-end 2015.
"Having formed KSGB just two years ago, we are on an aggressive track to become one of the world's leading multi-brand companies," said KSGB President and CEO Larry Remington. "KR3W and SUPRA are brands that meet the distinctions we are looking for in our portfolio: authenticity, strong brand awareness, a track record of product innovation and opportunities for long-term, global growth. We are excited to join forces with the ONE-Distribution teams and lay a foundation for the future."
A look at the latest from SUPRA:
The KGSB portfolio now includes six brand: K•Swiss, Palladium, PLDM, OTZ Shoes, KR3W and SUPRA Footwear. KSGB is a division of E-Land Group, a $10 billion group of companies with over 200 brands, 10,000 retail stores and business across apparel, footwear, retail, hotels, leisure and entertainment. The KSGB and ONE-Distribution leadership teams will work quickly over the following weeks to develop integrated plans for the company and its newest entities. With that said, we caught up with K Swiss CEO/President Remington to hear what the latest news means for Supra, KR3W and parent company KGSB.
Larry Remington: Our goal is to be a top tier multi-brand company. We are continually looking for footwear brands that complement our existing brands and have additional growth potential. Supra and KR3W fit what we were looking for – strong brand platforms, a track record of innovation and global growth opportunities.
What existing opportunities do you see for these brands over the next 12 months?
One of the larger opportunities will be expansion of distribution in Asia, specifically China. We also think there's plenty of growth to be had in EMEA and the Americas for both brands, and our resources and expertise will help the brands to capture it.
How does K Swiss’ already existing infrastructure work in supporting the brands – what shared resources will you be able to incorporate and which areas of the business will remain independent to the brands?
We believe in finding efficiencies through shared services, but just as important is to allow each brand to maintain its unique personality and identity. There are some obvious things to share, such as our investment in SAP, and some obvious things to keep separate, such as product design and brand marketing.
As part of the acquisition, why did you feel like it was important to keep Angel and Scott on in consulting roles for Kr3w and Supra?
There are no specific consulting roles or responsibilities. They just want to ensure a smooth transition to the new leadership team, and to do what they can to set the people and the brands up for continued growth.
As a result of this deal, will either of the brands be moving to new headquarters? What about staff changes – will there be any immediate changes to the teams at either brand? If so, what will that look like?
We are about to begin the process of learning about the One Distribution business and meeting the teams around the world, so we have no plans beyond that at this point.
Will Kr3w or Supra’s current distribution model change at all with this new ownership? If so what areas will K Swiss be helping the brands hone in on, and which areas will see less focus?
I think it will be business as usual in terms of distribution strategy. Their multi-channel strategy, spanning from core skate to lifestyle and fashion boutiques has been in place for about 18 months, so it's still relevant and still an important piece of the brand strategy.
What is your current take on the action sports market in terms of overall health, the state of retail, opportunities, risks, etc.?
It's no secret that the action sports market has been struggling. SUPRA and KR3W have always been progressive and always moving forward as part of their ethos, so they never had the chance to get stuck. Both brands have successfully evolved into lifestyle brands, both from a product design and retail distribution perspective. The SUPRA brand was born from skateboarding, and it remains a differentiator, but it doesn't define who we are or where we're going.
Anything else you'd like to add?
I think it's important for SUPRA and KR3W to maintain their commitment to skate culture and to stay rooted there. At the same time we fully support their desire to be progressive, to take risks with confidence and to be driven by style. That's where these brands can have the biggest global impact. I feel confident that KSGB can provide resources and expertise to add fuel to that fire.