Abercrombie & Fitch Overview

The Abercrombie & Fitch Company is a clothing retailer that caters to children and young adults. The company manages more than 800 locations across the country, of which 260 are Hollister Company locations and 175 are Abercrombie stores for children. It is an American lifestyle retailer that focuses on casual wear. New Albany, Ohio, is home to its headquarters. Abercrombie is a brand where everyone truly belongs. It acts with intent as its leader, and that spirit of fairness and inclusion permeates everything it does. As of February 2020, the organization operated 854 stores across all brands.

David T. Abercrombie started the first Abercrombie & Fitch in New York City in 1892 as an outfitter for elite outdoorsmen. In 1900, a wealthy lawyer, real estate developer, and devoted Abercrombie customer, Ezra Fitch, purchased a substantial stake in the company. It was incorporated in 1904 and given the name “Abercrombie & Fitch Co.” In the end, Fitch bought out Abercrombie’s stake in the company and became its sole proprietor from 1907 to 1928. The company was well-known for its extensive selection of high-priced and frequently exotic sportswear and equipment, including elephant guns and tennis shoes. The clothing, guns, tackle, and other goods in the store have been the symbol of correctness and opulence for more than fifty years.

At the beginning of the 1970s, Abercrombie & Fitch made an effort to expand its customer base by expanding its stock of less expensive items and moving into the suburbs, where other stores had been growing for some time. Although these steps did bring in new customers, it was too late. In 1976, Abercrombie & Fitch declared bankruptcy due to financial difficulties. While they filed for bankruptcy, the company’s name remained. For $1.5 million in 1978, Oshman’s Sporting Goods, a Houston-based retail chain, purchased the defunct company’s name and mailing list.

Oshman’s sold the brand and its operations to The Limited, a company based in Columbus, Ohio, in 1988. A&F gradually shifted its focus to young adults under The Limited, which later rebranded itself as L Brands. Later, it was spun off as a separate, publicly traded company and developed into one of the largest apparel companies in the United States.

A&F has maintained a high profile since 1997 in ways that are both beneficial (ads, brand expansion, philanthropy) and detrimental (legal disputes, boycotts, ads, controversies over clothing styles, employment practices). The brand refocused on the teen market in the 1990s. In 1998, the company expanded on its success by introducing Abercrombie Kids, a line of products for children aged 7 to 14. A&F enjoyed unprecedented popularity by 1999. “A new concept focused on the optimistic, laidback California lifestyle” was the slogan of A&F’s Hollister Co. subsidiary’s debut in 2000. By the end of the year, A&F had opened 32 Hollister stores nationwide, continuing its expansion throughout 2001. The company’s original A&F stores and Abercrombie Kids stores both expanded, reaching 144 locations across the country and 485 mall locations, respectively.

Despite the addition of more venues, sales began to decline by the middle of the year, and the company’s stock fell to less than $10 per share, from $50 two years earlier. The company’s business became battered as teenagers turned to high-style/low-price fast fashion brands like H&M and Forever 21 for their clothing. Following this, its merchandise mix was changed, and the A&F closed stores that were not performing well. After the change, the company received a lot of criticism for its clothing and advertising, which many people thought encouraged its target audience to have sexual relationships.

A&F made important changes to its image to compete with these fast-fashion rivals’ intense competition. It promised to focus more on customer service and diversity in staffing rather than sexually explicit advertising. The changes were evident in stores by May 2015.

Apart from the name brand, the company has operated four concept brands in the past. Despite being referred to as subsidiaries, they actually function as divisions under the umbrella of the company.

Abercrombie Kids

 It makes cool, excellent clothing that kids absolutely need to wear and is known for its made-to-play strength, comfort, and on-pattern plans. This brand represents an upbeat, youthful American style.

Hollister Co.

In order for teens to maintain a summer mindset throughout the entire year, regardless of the season, Hollister designs carefree styles that aim to make them feel celebrated and at ease in their own skin.

Gilly Hicks

Gilly Hicks is a lingerie brand that focuses on loungewear and intimates for women. Gilly Hicks is only sold in Gilly Hicks and Hollister stores worldwide and is a part of the Abercrombie & Fitch Co. portfolio.

Ruehl No.925

A&F owned the upscale clothing brand Ruehl No.925, which sold luxury goods, leather goods, and apparel. The store was designed to attract postgraduates between the ages of 22 and 35. Its design was inspired by New York City’s Greenwich Village. The only brand in the Abercrombie portfolio that offered black clothing was this one. A&F made the announcement on June 17, 2009, that it would no longer be operating the Ruehl brand.

As of the time of this writing, there are 44,000 employees at A&F and 23 of them hold leadership positions. There are 38% women and 62% men on the executive team. 67% of the team is white, 13% of the team is Hispanic or Latino, and 10% of the team is Black or African American.

• Fran Horowitzis, the Chief Executive Officer.
• Kristin Scott is the president of global brands.
• Greg Henchel is the Executive Vice President, general counsel and corporate secretary.
• Scott Lipesky is the Executive Vice President and Chief Financial Officer.
• Samir Desai is the Executive Vice President and Chief Digital & Technology Officer. .

At its peak in 1999, the brand exuded coolness and was nothing short of a teen icon. At first, the company’s target audience was focused on promoting the brand as one for teens. Then, it discontinued its logo-branded clothing line in August 2014 on the grounds that a component of its brand no longer resonated with its target market. However, a number of scandals, including alleged racist T-shirts, illegal hiring (and firing) practices, and discriminatory remarks made by the company’s then-CEO, have dimmed the brand’s popularity over the years.

By shifting its business strategy to trendier styles and faster production processes, it is effectively embracing fast fashion and attempting to market itself as an inclusive, authentic brand for contemporary Millennial customers. In response to the rise of e-commerce rivals, Abercrombie has closed many of its larger flagship stores since 2018. Instead, it has opened smaller, brighter-colored new stores to keep customers interested.

People are aware of the Abercrombie & Fitch Company brand, which has been in the market for a number of years. Because of this, its brand is well known.

The Minnesota Department of Human Rights fined the company more than $115,000 in 2009 for refusing to let a teenage girl help her autistic sister try on clothes in a fitting room. According to Michael K. Browne, the legal affairs manager for the Minnesota Department of Human Rights, the amount of the fine reflected pushback from the company.

A 16-year-old sued the company after discovering that she was being videotaped in a changing room by an employee, Kenneth Applegate II. He denied the claim, but coworkers found the video on his camera days later.

A customer filed a class action in 2010 regarding a holiday gift card promotion in 2009. The gift cards, according to the lawsuit, stated “No Expiration Date,” but Abercrombie revoked and expired the cards in the beginning of 2010. A judge approved a nationwide class in the case in 2012 and class members were notified in May 2013 via Class Notice.

Riam Dean, a British law student who had previously worked at the company’s flagship store in Savile Row, London, filed a lawsuit against the business in June 2009. She was born without a left forearm and claimed that despite being granted special permission to wear clothing that covered her prosthetic limb, she was soon informed that her appearance violated the company’s “Look Policy” and sent to work in the stock room, out of customers’ sight. She filed a disability discrimination lawsuit against the business, seeking up to £20,000 in compensation. The tribunal determined that the 22-year-old had been unlawfully harassed and wrongfully dismissed in August 2009. She was compensated £8,013 for lost wages and unfair dismissal.

In 2010, the job of a Muslim lady working at a Hollister store in San Mateo, California, was terminated. Prior to being excused, Hani Khan had rejected A&F’s HR delegate’s interest in removing her hijab. According to reports, the representative said that Khan’s headscarf, which she wears for religious reasons, was against the company’s “Look Policy.” The Council on American-Islamic Relations complained to the United States Equal Employment Opportunity Commission, claiming that the dismissal was in violation of nondiscrimination laws.

The Belgian Centre for Equal Opportunities and Opposition to Racism began an investigation into the hiring and compensation practices of the company in 2011. It was alleged that the company paid a premium to male models who worked shirtless, placed stringent requirements on the physical appearance of its employees, and only hired people under the age of 25.

• For the twelve months ending January 30, 2022, it generated a revenue of $3.684 billion.
• It made $355.18 million in operating income for the twelve months that ended on January 30, 2022.
• It generated $263 million in net income for the twelve months that ended on January 30, 2022.
• In 2021, it had total assets of $2.93 billion.

The business has a solid financial position thanks to five years of consecutive profits and profit reserves that can be used to pay for future capital expenditures. Additionally, it has been able to successfully generate positive returns on the capital expenditures it has made on numerous projects in the past.