Joe Mimran at a Tilley store in Toronto on Feb. 18.Christopher Katsarov/The Globe and Mail
Canadian retail veteran Joe Mimran is hoping to breathe new life into clothing brand Kit and Ace, teaming up with his long-time business partner and a former Canadian Tire executive to acquire the Vancouver-based retailer.
The clothing brand first launched in 2014, financed by Lululemon Athletica Inc. founder Chip Wilson and run by his wife Shannon and son J.J. Its clothing drew inspiration from the technical fabrics and trends found in athletic wear, but offered fits designed to be worn in casual and work settings.
In 2018, after severe cutbacks, Kit and Ace’s CEO and former Lululemon executive George Tsogas bought the company from Mr. Wilson.
Mr. Tsogas has now sold Kit and Ace for an undisclosed sum to Mr. Mimran, former Canadian Tire marketing executive David Lui, and Frank Rocchetti, a seasoned retailer who previously worked at companies such as Loblaw, Sears and Kroger.
Mr. Mimran and Mr. Rocchetti also took over another Canadian retail brand, Tilley, in 2020. Mr. Lui previously led marketing efforts for Canadian Tire-owned chains Mark’s, Sport Chek, Atmosphere and Sports Experts, before becoming chief executive of Canadian jeweller Korite International.
After discussions with Mr. Tsogas, Mr. Lui approached the two partners and together they have acquired the business under a new holding company, Unity Brands Inc.
“Post-COVID, so many retail opportunities have come up,” Mr. Mimran said in an interview. “I think because of the changing landscape and all that’s transpired, people are getting in and out of certain assets, and this is one of them.”
Mr. Lui will now step into the role of CEO at Kit and Ace. Mr. Tsogas will remain with the company as chief operating officer.
Even before the pandemic hit, Kit and Ace had been through some trying times. Within a couple of years of its launch, Chip Wilson acknowledged that the company had attempted to grow too quickly. In the fall of 2016, Kit and Ace began planning to close some of its roughly 60 worldwide locations, and laid off roughly 20 per cent of its 280 head-office staff.
Mr. Wilson told The Globe and Mail at the time that Kit and Ace had run into problems with suppliers, and had misjudged customer demand for certain items.
David Lui, new CEO of Kit and Ace, at the brand's Gastown store in Vancouver on July 4.Jackie Dives/The Globe and Mail
The following spring, there were further layoffs and the company opted to shutter all of its international stores in the United States, Australia and Britain, to focus on its nine Canadian stores and online sales.
Mr. Tsogas took over as CEO in April of 2017, and bought the company in the spring of 2018. During the pandemic, he cut back the bricks-and-mortar presence further, deciding not to renew some store leases.
Kit and Ace now has four stores across Canada, which make up roughly 25 per cent of its sales with e-commerce accounting for the remainder. The brand sells online to Canada, the U.S., Australia and New Zealand, and parts of Europe and Asia.
The new owners hope to expand its presence again, starting with two stores in Canada this year and at least two more planned for next year.
“We’re going to take our brick-and-mortar growth a bit more mindfully, and grow in key locations across the country,” Mr. Lui said. “We’re focused on our backyard right now. But definitely there are opportunities to look at stores internationally down the road.”
The new owners plan to revamp the product assortment starting in spring of next year, redesigning some of the women’s line, adding new styles and colours, and building on the popularity of strong sellers such as its men’s Commute Pant and polo shirts.
Mr. Mimran said he will also be looking at the company’s supply chain to improve sourcing and product development where it is needed. He will draw on years of experience in clothing retail: Mr. Mimran built Club Monaco, which was sold to Ralph Lauren in 1999, and created the cheap-chic Joe Fresh brand for grocery giant Loblaw Cos. Ltd. In addition to his recent work reviving the Tilley brand, he has invested in other Canadian brands such as Sheertex pantyhose and online housewares shop Goodee.
Sales for Kit and Ace have been growing in recent years, Mr. Mimran added, though he declined to share specifics.
Kit and Ace played a major role in bringing technical fabrics into work-appropriate apparel, said David Ian Gray of retail consultancy Dig 360 in Vancouver. The challenge for the company now will be differentiating itself from other companies that are now doing the same. Lululemon, for example, sells trousers designed for hybrid workers who want comfortable clothing even as they head back to the office.
“There is a lot of competition in their space,” Mr. Gray said, adding that this will be a marketing challenge as the brand seeks to draw in new customers.
Mr. Mimran said the partners hope to build on a “very loyal” customer base, which was what attracted them to make the investment. And he added that Unity may be interested in other assets beyond Kit and Ace as well.
“We are definitely open to more opportunities, that’s for sure.”
Editor’s note: An earlier version of this article incorrectly stated that Frank Rocchetti runs the investment firm Gibraltar & Co. with Joe Mimran. This version has been updated.