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Francesca's

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Francesca's
Company typePrivate
IndustryRetail
Founded1999; 25 years ago (1999), Houston, Texas
FounderChong Yi
Kyong Gill
Insuk Koo
John De Meritt
HeadquartersHouston, Texas,
U.S.
Number of locations
450+ (2023)
Key people
Andrew Clarke (President and CEO)[1]
ProductsClothing and accessories
OwnerTerraMar Capital
Tiger Capital Management (2021-present)
SubsidiariesFranki by Francesca's
Richer Poorer
Websitefrancescas.com

Francesca's (stylized as francesca's, and formerly known as Francesca's Collections) is an American women's fashion and accessories company based in Houston, Texas. As of 2021, the company currently operates 466 stores across the United States.

History

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Founding and fast expansion (1999-2015)

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Francesca's was founded in 1999 by three siblings, Chong Yi, Kyong Gill, Insuk Koo, and their close affiliate friend, John De Meritt, and they opened the first Francesca's stores in Houston, Texas.[2] Francesca's began trading on the Nasdaq Global Select Market on July 22, 2011, trading under the symbol, "FRAN".[3]

On May 14, 2012, Gene Morphis, who at the time was serving position as CFO at Francesca's, was terminated from his position after finding out that improperly communicated private company information was found through social media, but the company refused to state what information was publicly shared, nor where the information was posted on what form of social media.[4] A few months later, on September 4, 2012, John De Meritt, who at the time was serving position as CEO at Francesca's, announced that he would be retiring from the company by the end of 2012, after shares fell 4% at $34.51 in an afternoon trading. De Merrit would appoint President Neill Davis as CEO once he retires effective January 1, 2013.[5]

In 2014, the company saw a Q4 profit in its stock, and announced that up to 85 stores would open throughout the year.[6] On December 4, 2014, Michael Barnes was named the new CEO of Francesca's. Barnes was also CEO of Signet Jewelers and was President and COO of Fossil.[7]

Decline, store closures and bankruptcy (2016-2021)

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On May 17, 2016, as Francesca's shares began to plunge, CEO Michael Barnes announced that he would be departing from the company. The company also stated that its stock was at its lowest since the company began trading back in 2011.[8] Barnes would be replaced with Steven P. Lawrence as CEO and President.[9]

On January 31, 2019, Francesca's announced that it was exploring strategic options to save itself, including closing down stores and a potential sale. As a result, Steven P. Lawrence announced that he would be retiring after the announcement, and Michael Prendergast would replace him as CEO effective immediately.[10] On June 13, 2019, Francesca's announced that it would be permanently shuttering up to 30 stores as its shares declined by approximately 13%. CEO Michael Prendergast stated that Francesca's was in the early stages of a comeback, and it has plans to sell its current inventory by the end of Q2 2019, and would offer new and improved products later throughout the year.[11]

On February 14, 2020, Michael Prendergast resigned as CEO of Francesca's, and announced that Andrew Clarke would replace him as President and CEO of the company, effective March 9. Clarke also worked as President of Ascena Retail Group.[12] On November 16, 2020, Francesca's announced that it might be forced to file for Chapter 11 bankruptcy, amongst other options to revitalize its finances. Plans call for up to 140 stores to close by the end of January 2021. The company blamed the COVID-19 pandemic as the main cause for its significant financial hit that stopped physical store sales after all of its stores were forced to temporarily close, amongst a steep decline in mall traffic while also trying to boost online sales.[13]

On December 3, 2020, Francesca's declared voluntary Chapter 11 of the United States Bankruptcy Code in the United States District Court for the District of Delaware. The company has plans to sell its assets, including its online business and brick and mortar stores. The company also stated that it gained $25 million in financing from Tiger Finance, which would allow for the company to pursue a sales process that would allow for the company to stay afloat during the bankruptcy procedure while still in the process of liquidating 140 stores by the end of January 2021.[14] On December 7, 2020, Francesca's announced that it would be closing an additional 97 stores, and that its stock would be delisted from the Nasdaq after trading for nearly a decade, effective December 15, 2020.[15][16]

On January 21, 2021, Francesca's won court approval to sell its assets out of bankruptcy to TerraMar Capital and Tiger Capital Management, who would plan on keeping up to 275 stores open and keep the management team and employees intact.[17] On May 6, 2021, Francesca's filed a proposed liquidation plan a couple of months after its sale to TerraMar Capital and Tiger Capital Management. The plan would wind down the business and would sell assets to its creditors and bondholders.[18]

New store concepts and comeback (2021-present)

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On September 3, 2021, after completing its bankruptcy reorganization and avoiding liquidation, Francesca's announced that it was beginning to reopen many of its previously closed stores that closed earlier in the year. It was also testing new concept stores, including launching and opening two new tween store concepts called Franki by Francesca's by December 2021.[19] 9 more Franki stores would open by the end of 2022.[20] In April 2023, Francesca's announced that it would launch a sport collection for its Franki division, called Franki Sport. The new collection line would sell sport bras, leggings, tracksuits, jackets, tennis skirts, bike shorts, running shorts, etc.[21]

On February 1, 2023, Francesca's announced that they would be teaming up with ThredUp to create a platform called 'Forever Francesca's', which would allow customers to purchase secondhand items from Francesca's, and will give shopping credit to customers by sending in items.[22]

On May 12, 2023, Francesca's announced that it would acquire lifestyle brand Richer Poorer as a fully-owned subsidiary. As of October 2024, Francesca's currently operates over 450 stores under the Francesca's and Franki by Francesca's banners.[23]

References

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  1. ^ "Francesca's names Andrew Clarke as president and CEO". Fashion Network. February 14, 2020. Retrieved November 7, 2023.
  2. ^ "Francesca's CEO Departure: Uh Oh". Investor Place. September 5, 2012. Retrieved November 7, 2023.
  3. ^ "Francesca's Holdings Corporation Announces Pricing of Its Initial Public Offering". GlobeNewswire (Press release). July 22, 2011. Retrieved November 7, 2023.
  4. ^ "When social media gets you fired: Francesca's CFO is out". Los Angeles Times. May 14, 2012. Retrieved November 7, 2023.
  5. ^ "Francesca's CEO to retire, shares fall". Reuters. September 4, 2012. Retrieved November 7, 2023.
  6. ^ "Francesca's sees Q4 profit, comps slip; 85 stores on tap for 2014". Chain Store Age. March 25, 2014. Retrieved November 7, 2023.
  7. ^ "Michael Barnes Named CEO of Francesca's". WWD. December 5, 2014. Retrieved November 7, 2023.
  8. ^ "Francesca's shares plunge on weak outlook, CEO to depart". The Wall Street Journal. May 17, 2016. Retrieved November 7, 2023.
  9. ^ "francesca's® Announces Appointment of Steven P. Lawrence as President and Chief Executive Officer". GlobeNewswire (Press release). September 20, 2016. Retrieved November 7, 2023.
  10. ^ "Francesca's CEO resigns as Houston retailer explores potential sale". Chron. January 31, 2019. Retrieved November 7, 2023.
  11. ^ "Francesca's to close at least 30 stores this year as sales plunge 13 percent". Chron. June 13, 2019. Retrieved November 7, 2023.
  12. ^ "Former Ascena exec named CEO of Francesca's". Retail Dive. February 14, 2020. Retrieved November 7, 2020.
  13. ^ "Francesca's will close 140 stores, may file for bankruptcy". CNBC. November 16, 2020. Retrieved November 7, 2023.
  14. ^ "Store closings: Francesca's files for Chapter 11 bankruptcy protection, plans to close 140 stores amid COVID-19". USA Today. December 4, 2020. Retrieved November 7, 2023.
  15. ^ "Apparel retailer Francesca's plans to shut another 97 stores after filing for bankruptcy". CNBC. December 7, 2020. Retrieved November 7, 2023.
  16. ^ Drane, By Amanda (December 9, 2020). "Francesca's plans more store closures, will be delisted". Houston Chronicle. Retrieved November 7, 2020.
  17. ^ "Francesca's Clothing Chain Approved for Bankruptcy Sale". The Wall Street Journal. January 21, 2021. Retrieved November 7, 2023.
  18. ^ "Francesca's files liquidation plan following January sale". Reuters. May 6, 2021. Retrieved November 7, 2023.
  19. ^ "Francesca's tests new concepts, including tween stores". Retail Dive. September 3, 2021. Retrieved November 7, 2021.
  20. ^ "Francesca's expands Franki tween brand with 9 stand-alone stores". Retail Dive. April 26, 2022. Retrieved November 6, 2022.
  21. ^ "Franki by Francesca's Launches Franki Sport Collection for Ages 7 to 14". WWD. April 13, 2023. Retrieved November 7, 2023.
  22. ^ "Francesca's launches resale program 'Forever Francesca's'". Fashion Network. February 1, 2023. Retrieved November 7, 2023.
  23. ^ "Francesca's Expands With First Acquisition Of Lifestyle Brand Richer Poorer". Forbes. May 12, 2023. Retrieved November 7, 2023.
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