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Threadless brings in a new chief executive
I received the weekly Threadless newsletter and former CEO Jake Nickell announced they have brought in Tom Ryan as their new chief executive officer. Ryan’s previous experience comes from eMusic, Virgin Mobile USA and EMI Music. From my web research, it’s hard to find Ryan’s detailed background, but working with the aforementioned companies it dictates that he’s well versed in the web and media markets. I’m surprised that Threadless did not go with an experienced executive in the clothing and apparel industry especially one that has worked with brick and mortar stores. In my opinion, Threadless is a t-shirt company first and a web company second. Given their model of high volume, low pricing and quick inventory turnover, you need a chief executive that can increase the company’s overall margins without having to change their successful formula and alienating their strong user base. I hope Ryan’s the one to take Threadless to an even more exciting level.
Threadless is a private company, and figures are not publically available, so it’s hard to guess where Ryan and new CSO and co-founder, Jake Nickell will take Threadless. I have a few predictions as to what will be accomplished over the next few months and years.
My gut feeling is that Threadless will continue to expand their brick and mortar presence. Threadless is unique in a sense that they require their inventory to most very fast. The brick and mortar leaders such as Macy’s or Nordstrom would love to carry Threadless, especially given the brand loyalty of the customers. However, it would be hard for these stores to consistently move the inventory on a weekly basis given Threadless’ new release every Monday. I see the Chicago store as the template for further expansion to a mall near you within the next couple of years.
My next prediction is that Threadless will look into becoming more Dell-like from the inventory perspective. From my experience with Threadless, they are the king of process and operations. That’s why they can sell you great t-shirts at an affordable price. Dells inventory sits on their floor for 2 days or less. Threadless has recently gone from the Fruit of the Loom and American Apparel stock to their own Bangledesh made shirts. This is an indication that if they haven’t already controlled their entire supply chain process they will do so very soon. In addition to controlling the supply chain, order fulfillment can be outsourced to a cheaper alternative. The video footage of watching their employees go through their shelves to fulfill orders will be a thing of the past. Threadless will then film a new short called “Just In Time (inventory) Gone Wild”!
My last prediction under the leadership of Ryan is that he’ll introduce additional products beyond the shirts. We’ve already seen the baby wear and hoodies in addition to their popular shirts. I wouldn’t be surprised if they go beyond this and introduce tank tops, jackets, gym bags or some other crazy item that will capture my disposal income.
Congratulations and best of luck to Tom and Jake in their new roles. I see the MP(3) shirt below as a representation of Tom, Jake and Jacob leading Threadless to new ideas, innovation and an even better product and brand.
Jeffrey said,
May 13, 2008 @ 4:14 pm
I can promise you that we will never outsource our fulfillment. If it was something we would have done, it would have been done long ago. To your point, if we were trying to control the whole supply chain, it’d be silly to outsource one of the most important parts. Cheaper isn’t always better and value doesn’t always directly relate to money. Having a warehouse filled with happy, inspired workers who work directly for us and enjoy all the same benefits as every other employee of skinnycorp will always yield a better result than moving it off-site simply to save a few cents per package. Well written article though!
Big Al said,
May 13, 2008 @ 4:33 pm
Hi Jeffrey,
Thanks for taking the time to respond back to my posting. I hope it’s true that we can expect to have the same TLC from every shirt for years to come. I agree that cheaper isn’t always better. Happy employees are the company’s most valuable asset. However, I fear that as Threadless expands, it may become “corporate” and penny pinch everything.
Over the next few days, I’ll probably expand on my predictions and thoughts about Threadless management change. I felt that I wrote this article rather quickly, and my thoughts weren’t given the justice that they deserve. I’d love to hear what the readers of lovesthreadless.com and SkinnyCorp think.
Big Al
Johnny Shirtwearer said,
May 26, 2008 @ 11:14 am
Jesus. I come from a business background and I can smell a company in trouble a mile away. They finally brought in a businessman to tighten up their company for sale to a major chain. This is so predictable. I guarantee you’ll be buying the most ‘popular’ designs from Threadless’ archives in Wal-Marts, Targets, and other big box stores within a year or two. It’s the only way to grow the company to an appreciable degree. Fortunately for Threadless and their “legal agreements” they basically own the asses of every artist who has ever submitted a winning design to them. With their catalogue of artwork (yes, kids they actually OWN what you’ve created), they could pump out new designs every week into new retail channels for years.
Johnny Shirtwearer said,
June 3, 2008 @ 10:34 am
Jeffrey, who cares about the fulfillment? That has zero effect on the quality or consumer desirability of the product available. Of greater concern is the that the folks who started Threadless have already basically “moved on” and in their place the bean counters have been installed. Decisions that used to be responsive to the community at large will now be settled by “does it make us money”? I anticipate the sale of Threadless and it’s catalog of designs to a major chain (possibly Target or Urban Outfitters) within the space of a year. Mark my words. Business people make “business” decisions. Good luck with “Naked & Angry” and your wallpaper thing, two not very strong ideas.