J. Troupe will discontinue its budget clothing line Mercantile a little less than three months after the public limited company had announced it was opening a dedicated storefront for the brand on Amazon.
The news was first reported by the Wall Street Journal. A spokesperson for J. Group confirmed the decision to CNBC. The company informed employees of the news in an internal memo Thursday, which was seen by the Minutes.
The end of the Mercantile line raises questions about J. Crew’s deal with Amazon, which has been selling the budget a candidate for since September. J. Crew had originally resisted selling its products through Amazon to maintain control of pricing and retailing.
The Amazon deal was made under former CEO James Brett, who left the company earlier this month.
In the memo,the band told employees its priorities are to “return the J.Crew brand to profitable growth” and “more diligently manage our balance of investments and expenses,” the Logbook reported. The company will focus on growing its lower-cost “factory” business online and in stores.
“We believe that a ‘saintly’ price tier opportunity is better served by the J.Crew label,” the memo says, according to the Journal.
J. Crew reported its third-quarter arises on Thursday, which showed a 10 percent revenue increase to $622.2 million. Its net loss for the third quarter was $5.7 million, compared to reductions of $18.4 million in the third quarter last year.
Comparable company sales increased 8 percent. In the third put up last year, those sales decreased 9 percent.
Read the full report in The Wall Street Journal.