Jones in Wal-Mart deal

Jones Apparel Group has inked a deal to supply Wal-Mart with its L.e.i kidswear brand and will introduce a fast fashion model across its womenswear brands.

Jones, whose sales dipped to US$3.8 billion (£1.9bn) for the year to December 31 2007 from US$4.8bn (£2.4bn), said it would introduce its L.e.i brand into Wal-Mart stores across the US this summer.

It will create a back-to-school collection for the grocer as well as a general kidswear range and a girlswear collec-tion under the L.e.i brand, which stands for Life, Energy, Intelligence.

Separately, Jones said it planned to step up its sourcing and supply chain to help it compete with the likes of H&M and Zara. The group is testing a fast fashion model with its footwear brand Nine West for autumn.

It will unveil the first fast fashion line to buyers next month and will hold between 20% and 25% of the range in stock for in-season delivery. It will also work on 10-week lead times for reorders from wholesale customers.

Jones reported a 16% dip in sales to US$839m (£427.7m) for the three months to December 31. The company said sales had been hit by the planned exit of some of its brands, including its Polo Jeans Company which it sold back to Ralph Lauren.

Group chief executive Wesley Card said: "While we accomplished a great deal during the second half that will help position us for future success, the fourth quarter proved particularly challenging, largely due to the disappointing holiday retail season and the macroeconomic environment.

"Our wholesale businesses were negatively affected by higher-than-planned markdowns to support our retail partners, and our retail operations continued to trend negatively during the quarter. Comparable store sales in our own stores were down 4.8% for the fourth quarter.

"As we enter 2008, we expect to begin to realise the benefits of many of the turnaround and recovery initiatives that we have implemented through-out the company, such as enhancing our product offer-ings and streamlining our supply chain and distribution networks, as well as jettisoning several of our less profitable businesses."