JD Sports Fashion has pulled the plug on its own label menswear fascia Open, making a number of head office staff redundant.
Its 11 stores, the first of which opened in Stevenage in August 2014, will continue to trade under the Open fascia while JD looks at alternative uses for the sites.
The move comes two months after JD sold its struggling young fashion business Bank to a subsidiary of Hilco Capital and declared it would prioritise future investment in its core sports fascias, which include JD and Size?. Bank was put into administration earlier this month.
One source told Drapers: “JD has lost confidence in the fashion side of the business after what happened with Bank. They are concentrating on the sports side of the business now.”
Sources said all of Open’s head office staff have been issued with redundancy notices.
A spokeswoman for JD said: “JD Sports Fashion has decided to cease investment in the 11-store Open fascia trial. As a result the management of the business is currently announcing a small number of job losses within its head office. The fascia’s stores will continue to trade at this time and the group is currently looking for alternative uses for the sites and store-based employees.”
One young fashion source said: “All head office staff were given their redundancy notices yesterday. They are trying to do it under the radar. I’ve heard they can’t put it into administration as it’s not a subsidiary like Bank was, it’s part of the main JD company. I’d imagine they will rebrand the stores they can’t get rid of to JD Sports or one of the other fascias.”
Another source close to the situation said: “Open hasn’t been doing well. All young fashion stores are struggling; just look at Bank and USC. Open is not a business I would like to be aligned with. The Arndale store [in Manchester] is still doing a very heavy discount; it looks like they are clearing out inventory.”
The 11 Open stores are in Stevenage, Northampton, Arndale, Hanley, Merryhill, Leeds Trinity, Silverburn, Brighton, Bristol, Leicester and Bury. Drapers understands that store staff were instructed by JD to stop any marketing activity a couple of weeks ago.
Open is headed by former Blue Inc buying and design director Stephen Galea who was managing director. He worked at Blue Inc for eight years but had previously spent 12 years at Arcadia, becoming head of buying for menswear at Topman in 2003.
Stewart Messer, formerly head of buying at Blue Inc, was head of buying for Open while Oliver Woodhouse, previously head of buying and merchandising at Bench, was head of merchandising. Design was headed up by Rachael Stocks Thomas, who was previously a senior men’s designer at JD but has also held roles at Tesco, Boxfresh and River Island.
Earlier this month JD said it expects its full-year profits to exceed £90m after like-for-like store sales grew 12% in the five weeks to January 3.