Here’s what I found so invigorating about J.Crew’s strong third-quarter performance (its profit more than doubled): The retailer did not attribute it to cost cuts. Instead, the chain based it on something slightly more old-fashioned but a lot more significant with regards to long-term growth: sales. Same-store sales rose 8% in the quarter, while overall sales jumped 20%.
I wasn’t all that surprised by the results. J.Crew seems at the top of its game. Its stores look great, and the merchandise even better. And unlike a lot of other retailers, when you shop J. Crew, you don’t get the feeling that the sweater that sells for $69 one day will be on the clearance rack the next. The fact is, J.Crew occupies a great sweet spot right now: It has become the go-to store for upscale shoppers looking to trade down a bit and for middle-market ones who want to trade up.
There’s no getting around the fact that J.Crew is a merchant-driven company, with the message set at the top by CEO Millard “Mickey” Drexler. Commenting on the third-quarter results in a company statement, Drexler said the company's success was tied to doing simple things well.
"It's about product, it's about quality, it's about design, it's about creativity," he said.
Interestingly, J. Crew reportedly doesn’t have any special promotions or discounts in place for the holiday season. It may be of the few retailers that doesn’t have to.
