WHAT’S BEING CLAIMED:
- Lord & Taylor, one of the most iconic department store chains, has now been acquired by clothing subscription service Le Tote.
- The $75 million deal includes a secured promissory note for $25 million after two years.
- All 38 remaining Lord & Taylor stores will now be managed by Le Tote.
Well-known luxury department store chain Lord & Taylor has now been purchased by clothing subscription service Le Tote. The $75 million deal with the chain’s parent company, Hudson’s Bay Company, included a secured promissory note for $25 million after two years.
All 38 remaining stores and online businesses will now be effectively managed by Le Tote.
The CEO of Hudson’s Bay, Helena Foules, announced in a press statement: “Following an extensive review of strategic alternatives, Le Tote’s leadership and innovative approach is the best path forward for Lord & Taylor, its loyal customers and dedicated associates. For HBC, this transaction builds upon our previous bold actions, further enabling us to focus on our greatest opportunities, Saks Fifth Avenue and Hudson’s Bay.”
Le Tote, which was founded in San Francisco in 2012, was one of the first to offer clothing subscription services. Earlier companies include Rent The Runway, which debuted in 2009. A Le Tote subscription includes a monthly “Tote” containing personalized clothing items, from which members can keep what they like and return the rest.
A press release declared that Le Tote’s “proprietary technology, data, and innovation combined with Lord & Taylor’s traditional store footprint, e-commerce presence, and merchandise selection will offer customers a new experience in the mid-market segment.”
Le Tote CEO and founder, Rakesh Tondon, said in a press statement: “Since founding Le Tote, it’s been our mission to push the boundaries of retail. We’ve strived to lead the charge in developing innovative, intuitive, value-driven ways for customers to engage and consume.”
Lord & Taylor, just like most department stores, struggled significantly in recent years. Its iconic flagship location in Manhattan had closed earlier this year after the building was bought by WeWork for $850 million in 2017. According to The Wall Street Journal’s report last month, Amazon plans to lease the former flagship.
Other traditional retailers have made similar efforts. Companies revitalized their struggling brands through partnerships with new, popular companies in emerging areas of retail such as rental, subscription, and consignment. Some of the recent collaborations include both JCPenney and Macy’s announced partnerships with ThredUp, which showcase curated selections of secondhand items in select stores.