MONTREAL — Le Chateau says it hopes to reverse years of financial losses by reintroducing itself to customers who were loyal in their rebellious youth but are now seeking fashionable office attire.
The Montreal-based clothing retailer says it will promote its more mature styling in an ad campaign next month. It is also preparing to introduce a loyalty card next year and expand its online wedding boutique, which was launched last spring.
Company founder Herschel Segal said after Wednesday's annual meeting that the company moved slowly to reposition itself, but is regaining its footing.
That means reconnecting with former customers by offering clothes targeting working men and women, he said.
With the help of ad agency Sid Lee, Le Chateau (TSX:CTU.A) plans to promote the brand's repositioning that has been developing over the past few years, including the rollout of a new store concept that features better lighting, more fitting rooms and improved clothing displays.
Le Chateau executive vice-president Franco Rocchi said he's optimistic about a turnaround because that concept, which has been rolled out in several top markets in Canada, has shown sales improvement even without advertising.
About 20 stores will be remodelled by the end of this year, representing about 10 per cent of its Canadian network. More will be added as leases are renewed, the company said.
Le Chateau also plans to continue closing underperforming stores in a bid to stem four years of losses amid declining sales. Its e-commerce business is growing by double digits but accounts for less than 10 per cent of its overall business.
Segal, who recently lent the company another $15 million on top of a previous $10 million, said he will continue to give it a lifeline as long as he sees potential for improvement.
Meanwhile, his wife Jane Silverstone Segal, who replaced him as chairman and CEO, reassured shareholders that Le Chateau has developed the right strategy for a brighter future in a competitive retailing segment that has seen several failures.
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Ross Marowits, The Canadian Press