Who says retail is dead?
It´s the retail apocalypse for many department stores or fashion retailers in USA that couldn´t manage their different channels and pricing…but Supreme is the example of retail excellence in the Millenials era. An era where niche players have the power as I wrote in the Fashion retail long tail.
According to Quartz, the underground fashion brand Supreme sold a 50% stake to private-equity firm Carlyle Group for a reported $500 million (paywall). The $1 billion valuation puts the streetwear darling in the big leagues.
Supreme opened its first store on Lafayette street (Nolita, NYC) in 1994 and became the home of New York skate culture. Since then, it has grown to be the embodiment of the downtown culture opening 10 stores in USA (3), Paris (1), London (1) and Japan (6).
Today it´s a vertically integrated fashion retailer that creates seasonal collections but drops new products almost each week thru limited collabs such as Louis Vuitton, Peter Saville, Larry Clark, Roy Lichtenstein, Jean-Michel Basquiat or The North Face. Its brand awareness is so successful that Supreme stores created a new way to queue in order to manage their high demand. Queues generates even more buzz amongst fashion underground fans that spend more than 30 minutes waiting to access Supreme stores.
Supreme fans queueing (Hypebeast)
Supreme store at Soho NYC during my last visit on October 2017
Every week Supreme releases a “drop” of a about a dozen new items… from a $44 t-shirt to a $598 leather jacket. The idea is to keep the product line fresh, demand high, and the lines outside stores insanely long (The Scarcity Game, Quartz).
The Carlyle Group is an American multinational private equity, alternative asset management and financial services corporation. Their portfolio of investments in fashion includes Golden Goose, Twin-Set and Scalina.
This is a turning point in the history of corporate finance and private equity investments. Carlyle Group is paying a huge amount of money for a brand that has only 11 stores but creates more noise than many multinationals. Supreme goes beyond a regular fashion retailer, selling exclusive perishable capsule collections that makes its loyal customers queue every thursday. This is going to be analyzed in many Business School…
Read more about Supreme and Carlyle Group on Business Of Fashion