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TWST: Would you begin with a brief historical sketch of Gymboree and
tell us about some of the company's activities at the present time?
Ms. Harper: Gymboree started as a parent-child interactive play program
in the mid-1970s. It's now been in operation for 26 years. A US venture
partner got involved in the 1980s and started a retail apparel store
that sold active-wear, which tied directly back to Gymboree's play
program. The company went public in 1993 and now Gymboree retail has
more than 580 stores. In 2002 we launched a new concept, Janie and Jack.
We currently have 33 Janie and Jack shops operating. We'll open another
25 this year, so we should end the year with close to 60. The creation
of Janie and Jack essentially represents what the Gymboree Corporation
is about at this point. The Gymboree brand and its retail position in
the marketplace, while still strong, has reached a level where we have a
minimal amount of growth and development left in terms of total square
footage. We do have productivity improvements we can make, and we think
we have some room on the operating margin with Gymboree, but we feel the
company is really positioned to lead the market in launching specialty
niche concepts, so we've rebuilt our operating platform with that in
mind. Gymboree had hit a spot in the late 1990s and early 2000s where
the brand had been redirected and really got into a lot of trouble as a
result. In 2000, I led a team to fix that aspect of the business and we
decided that, since Gymboree had a minimal amount of growth left in it,
the company really needed to develop its platform to allow us to grow by
developing niche concepts, so we've spent the last four years rebuilding
the operational base to allow us to launch new concepts very quickly and
efficiently. We feel that consumers are well served in moderate and
lower-priced mass specialty or mass market but that true specialty is
missing from the retail marketplace. At The Gymboree Corporation, we
think we have the design capabilities and the conceptual capabilities to
be able to deliver true 'specialty' and leverage the overall operational
platform that we've rebuilt in the last four years. So that is where we
are today. We just announced another new concept that we'll be testing
this year, 2004, a women's wear concept called Janeville.
Tickers included in this excerpt: GYMB
For more information call (212) 952 7400. The
Wall Street Transcript does not endorse any of the comments made by interviewees, and does
not make stock recommendations.
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