New project for Lululemon family

Kit and AceThe family behind one of the world’s largest athletic apparel retailers, Lululemon Athletica, is bringing its new retail brand to Australia, with the first store to open by mid-June, Inside Retail PREMIUM can exclusively reveal.

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Kit and Ace is the brainchild of Chip Wilson’s wife, Shannon, and son, JJ Wilson, and began in Canada in 2014 after the Wilson family parted ways with the 250 store Lululemon chain. Chip Wilson began Lululemon Athletica in 1998, but stepped down as non-executive chairman in December 2013 and resigned from the board in January.

Kit and Ace specialises in contemporary and “technical luxury” fashion, whereby technical performance attributes are applied to high end fabrics such as cashmere.

The first Kit and Ace store was opened by JJ and his stepmother, Shannon, in Vancouver last year, and has since grown to seven stores across the US and Canada, including San Francisco, New York, Toronto, Edmonton, Saskatoon, and Calgary.

Another 13 stores have been confirmed to open in the US by mid year, with a total of between 30 and 55 to be operating globally by the end of the year.

Kit and Ace plans to open standalone stores in Australia this year, with the UK and Tokyo also on the company’s radar for 2015.

In his first Australian media interview, JJ Wilson told Inside Retail PREMIUM the company is actively looking for sites in Sydney, Melbourne, Brisbane, and New Zealand.

“Our history comes from technical athletic apparel. It’s something that we’re really good at and we have a knowledge of. Shannon is an incredible fabric designer and she was living in Sydney at the time [around two years ago] and I was living in New York and we started talking about what we wanted to do next,” Wilson told Inside Retail PREMIUM.

“We found that we were wearing our athletic apparel all day everyday and we also loved fashion, so we wanted create something that really brought those two together.

“We wanted to wear something as soft and luxurious as cashmere but also have it function in a similar way that our athletic apparel works for us.

“It was actually in Australia that we decided that we would go off and create ‘Technical Cashmere’. Shannon lived in Sydney and I went back and forth for about two years and she tested and developed Technical Cashmere from Australia, so actually the fabric and the whole premise of the company was discovered in Sydney.”

JJ and Shannon spent two years developing the fabric of Technical Cashmere, understood to have been rejected by Lululemon, with the duo moving back to Vancouver and Lululemon for a brief period before collectively leaving the business in 2014.

“We had Technical Cashmere as our core fabric and we decided to open a little shop in Vancouver, just Shannon and I, so we started making t-shirts. We made 10 t-shirts and then we made 20, and people were just loving Technical Cashmere as a fabric and that quickly evolved into seven stores across Canada and the US,” Wilson said.

“It’s kind of exploded a little bit and there’s definitely been some horrible things that have come out of it, but we’ve learnt so much. We can’t grow this quickly and not have bad things happen, but for the most part, it’s just been so exciting and I’m hoping that it’s going to be the same in Australia.”

Australian plans

In the past 12 months, the business is understood to have gone from around four employees to 240, and the Wilson family plans to invest as much as $300 million in the global rollout.

There are five staff in Australia, led by country manager of Australia and New Zealand, Alexie O’Brien.

O’Brien was formerly GM of Lululemon Athletica Australia from June 2010 until July 2014 and has held the position since January. Wilson says the company has also recruited a brand manager, marketing director, and retail and shop fitout staff.

Listed on Kit and Ace’s website are six retail positions in Australia, three junior shop directors and three senior shop directors for Sydney, Melbourne, and Brisbane, however, store locations have not be named. The business is also seeking an Australian PR and communications specialist.

“We have people on the ground now that are ready to go and are ramping up to open up shops and soon as those real estate conversations start going I’m really hoping that it’s going to take off and we can open up almost faster than we were initially intending for Australia,” Wilson said.

“It’s looking like we’ll have something confirmed and a shop open by the middle of June, but it’s still up in the air. It’s my hope that what we have would be for the middle of June. I’m hoping in Melbourne or Sydney.”

Kit and Ace’s bricks and mortar footprint is a mixture of pop up sites, referred to as studios, which generally trade for around six to nine months; and permanent, flagship sites, which range from between 250sqm and 280sqm.

The studio format takes around six weeks to set up, while stores take between three to six months. Kit and Ace is seeking both models in Australia, in shopping malls and strip locations.

Stores in Australia will follow a similar aesthetic and colour palette to stores in Canada and the US, however, Wilson is hoping to make sites unique to the area the stores are located by partnering with local artists and using local fixtures.

“Sydney, for example, I would be looking for something cool, maybe a unique space in Surry Hills, and then I would go to maybe somewhere like [Westfield] Bondi Junction.

“If it was Melbourne, I would look at Fitzroy, which I absolutely love, and then maybe go into the nearest Westfield or the most luxury lifestyle Westfield because Kit and Ace is ultimately a luxury product − you’re looking at $100 t-shirts.”

Kit and Ace will launch international e-commerce shipping by June, with a dedicated Australia site to be operational by September.

“You can browse online right now. Because we don’t have a store on the ground yet, there wasn’t a huge amount of emphasis on [online], but now that we’re getting close to tying up some real estate we want to also make sure that e-commerce is available to Australia.”

Kit and Ace’s womenswear and menswear lines include tees, sweaters, underwear, pants (for men only), and accessories such as scarves, blankets, and beanies.

Women’s prices range from around $68 to $88 for basic tanks and tees, while sweaters are priced around $108. Men’s prices range from $88 to $100 for basic tees and sweaters and pants are priced at around $148.

Wilson is also looking to employ a locally- based design team in an effort to overcome seasonality issues, which have plagued other international retailers in the past.

“I’m probably going to have an Australian design team between [Canada] and Australia designing products for Australia specifically, as well as giving Australians access to both collections. I want to offer them everything.”

This story first appeared in Inside Retail PREMIUM issue 2041. To subscribe, click here.

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