Guess prioritizes consumers and product in new long-term plan

By

Robin Driver

Published
Dec 4, 2019

American clothing brand Guess unveiled its new five-year strategic plan on Tuesday, revealing a focus on product, consumers and brand building, as well as a solid financial outlook for 2025.

 
The Los Angeles-based company listed five strategic priorities that it will be carrying forward for the next five years. Among these, Guess will be following current industry trends by aiming to become a consumer-centric business, notably by seeking to offer its customers a “seamless omni-channel experience.”
 
On top of this, the brand will be looking to expand its product offering in such a way as to appeal to a wider range of consumers at different points in their lives, while also giving further consideration to local product needs.

The third column of Guess’ new strategy involves ensuring the continued relevance of the brand, efforts that will be organized around three target consumer groups: heritage, millennials and Gen Z. As part of this strategy, Guess will continue with collaborations and partnerships with celebrities and influencers, as the company believes that these initiatives resonate particularly strongly with younger audiences.
 
Another focus for Guess is strengthening its global footprint by optimizing its productivity and profitability, while also expanding its distribution channels.
 
Finally, the company is planning to drive improvements in its functional capabilities, particularly in logistics, sourcing, product development and production, and inventory management, as well as in overall infrastructure.
 
“I strongly believe that the Guess brand has tremendous potential to continue to expand globally and amplify its customer reach,” commented Guess CEO Carlos Alberini in a release. “We have a true global brand, a unique product offering and a diversified business model with an opportunity to grow. I believe we are well positioned to capitalize fully on this opportunity.”
               
In terms of its financial outlook, Guess expects its sales to increase between 2.7% and 3.0% in 2020, with CAGR predicted to continue to rise in the low single digits between 2021 and 2025, representing a total increase of $250 million over the five-year period.
 
Earnings per share (EPS) are expected to increase between 34% and 39% to between $1.31 and $1.36 in 2020, with CAGR predicted to be up in the high teens over the next five years. In 2025, EPS is expected to be approximately $3.00.

Guess reported earnings of $12.4 million in the third quarter ended November 2, 2019, on revenues of $615.9 million.