BREAKFAST WITH THE BOSS – KAHN LUCAS

Colleen Kelly – President, KAHN LUCAS
Thurs June 14, 2012

Kahn Lucas Lancaster Inc. has been around for 123 years. Yes, since 1889. It made uniforms for soldiers, nurses, the Red Cross – and children’s clothes, with a specialty in girls’ dresses. The breakfast took place at the office of “Dollie & Me,” one out of Kahn Lucas’s popular childrenswear brands. Stepping into the colorful office was like stepping into a little girl’s dream world. We couldn’t wait to learn what it’s like to be the head of a company that’s in the business of making dresses and dolls. “It’s just wonderful to earn your living talking about butterflies all day!” Colleen laughed.

Coming from a history of working with megabrands, Colleen worked at Donna Karan before moving on to make a name for herself in industry for turning around failing companies. She was behind the transformation of Calvin Klein Jeans and Tommy Hilfiger, both once on the verge of bankruptcy. But now, at Kahn Lucas, Colleen is in her element: “In big companies, you have to answer to Wall St. There is a lot of hierarchy, and often it takes a while for things to get done. Here, you can’t rely on a name, but a design. It’s really the product that matters,” she said.

So how does it work? “Big brands like Tommy Hilfiger will have a particular Open To Buy based on past sales performance, but for companies like us, buyers will decide the best 25 dresses without looking at the brands, and the ones that are the most on-trend and at the best price points win. If you have a long relationship with the buyers, perhaps they will buy a little more, but mostly, you have to rely on your product. Every market you never know how many buys you’re going to get! And if you’re in for three markets and don’t get any buys, then you’re off the matrix!” she said.

Not a fashion or merchandising major? There’s no need to fear. Colleen was a theater major at Boston College, and wanted to be a director or actress. “But eventually I realized that that route was not for me, and I worked in retail throughout high school and college, so I enrolled in an executive training program and became a buyer,” she said.

Back then the retail landscape was very different than it is now. There were a million department stores, and Colleen got her start at a department store called Jordan Marsh, now a part of Macy’s. “Eventually, I was put in charge of an entire store, and for the first time, I needed to manage union employees, and employees who were just not willing to put in more effort than they need to. It was my job to motivate these people, and I learned a lot from the experience,” she said. The next step for her was to move to the wholesale side. “I did many different contemporary collections for 25 years,” she said, “and I just fell in love with sales.” We know what happened next.

Colleen was always one to set benchmarks for herself: “I wanted to be a President of a company by 40, and by the time I was there, I started getting the calls!” She also stresses the importance of figuring out your own path: “A lesson I learned was that you can’t keep working for small companies where the top role was owner. A friend of mine, Mindy Grossman – the CEO of HSN now – figured out her career path early in the game and went into larger companies right from the start. It’s important to figure out where you want to go as quickly as you can.”

Colleen’s journey with Tommy Hilfiger started with a simple phone call: “After becoming known in the industry for fixing companies, I got a call from a headhunter. I was reluctant to agree to the meeting at first, but eventually my curiosity got the best of me. And that’s another important thing – meet with as many people who want to meet with you – expand your network.”

At the time, Tommy Hilfiger had gone the urban route and lost its original preppy customers who ran to Ralph Lauren or J. Crew. It had more than 7-800 million in growth but lost the new customers to more authentically urban companies like Sean John and Rocawear. The European Tommy Hilfiger brand, though, had not been bastardized, so there was still hope. The company was taken private, and it lost a lot of money. Retailers like Belk and Dillard’s all got out. “I had to fire 100 more people – and I had 60 days to do it – it was probably the hardest thing I had ever done in my life. But I also got the opportunity to build a new team, and it was great experience,” she said.

After five years, it was time to sell. It was acquired by PVH in a merger of equals. “Tommy Hilfiger was a great experience, but at that point, I was bored and wanted something new to do,” said Colleen. She took the summer off and figured out the next step: “it had to be not a public company, and also something I have never done before,” she said.

Dollie & Me is Kahn Lucas’s biggest brand, in direct competition with American Girl. Madame Alexander produces the high-quality dolls, though they sell at one-third of the price of American Girl. The company has access to retailers of a wide range of price points, including Nordstrom, Lord and Taylor, and even Wal-Mart. And the growth is phenomenal: the e-commerce site is launching September 1, Kohl’s just bought 100 000 dolls for Christmas, and the company’s Facebook page already has 18 000 Facebook followers. “Parents would even post up pictures of their daughters and their matching dolls!” Colleen laughed.

The best thing about being the President of Kahn Lucas? “It’s quick decision and execution in this company. And buyers for childrenswear are generally less stressed out – it’s a market that’s going to be there.”

Key Lessons and Takeaways:
• Be the person in the office that works the hardest – you have to surprise people with your initiative. Try to do something that shows your value-added at least once a week.
• Don’t be afraid to learn about other areas of the company. To become a leader in the industry, you need to know all aspects of the business.
• Learn to manage your career path and set realistic benchmarks. Then achieve them.
• There are pros and cons of working at a larger vs. a smaller company. Understand them and figure out where you want to go, as early in your career as possible.

*Notes compliments of Maggie Jiang

2012 scholars meet with Colleen Kelly, President of Kahn Lucas

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