Randa Sells Third-party In-store Service Arm to Winston Retail

//Randa Sells Third-party In-store Service Arm to Winston Retail
Winston will absorb nearly all of the 2,000 people that work for Randa’s Market Connect Group division.

By Jean E. Palmieri on January 10, 2020

Randa Accessories, the largest men’s accessories manufacturer, has grown to the point that it can no longer effectively service other brands through its MCG: Market Connect Group subsidiary. So it made a deal to sell the third-party arm of the company to a friendly competitor: Winston Retail.

MCG, which Randa acquired 20 years ago, provides in-store services such as merchandising, visual display and replenishment to thousands of retail doors across the U.S. When it started, a small team provided these services to a small number of department stores. But MCG now employs some 2,000 people and is one of the country’s largest in-store service providers for general merchandise retailers, notably department stores.

Last year, Randa acquired the Haggar Clothing Co., bringing its reach to apparel for the first time and creating a $1 billion-plus company. Randa had first explored entering the apparel business when it tried to buy Perry Ellis International in 2018, but was ultimately unsuccessful.

As a result of the Haggar purchase, the decision was made to divest itself of the third-party services and retain around 200 people to work solely on Randa products and Haggar.

The remaining staff is expected to seamlessly be absorbed into Winston Retail over the next two to five weeks, according to David Katz, chief marketing officer of Randa.

Terms of the deal between the two privately held companies were not disclosed and the transaction is expected to close on or around Jan. 31.

Katz explained providing in-store services to Randa’s retail clients is necessary in order to ensure its neckwear and belts, for example, are presented in a visually attractive way. “Randa is a high-touch business,” he said, and these people not only ensure the floors are neat but also help customers with styling. Eventually, other brands such as Levi’s, Columbia, Dickies and Fitbit hired MCG to ensure its products also received attention on the sales floors.

“But as Randa grew, we needed to reach thousands of doors, and it wasn’t very efficient,” he said. And servicing other brands had become a “distraction.”

So when the decision was made to no longer work with other brands, Katz said his first call was to Jan Croatt, founder and chief executive officer of Winston.

“The acquisition of MCG will add significantly to Winston’s reputation as the leader in in-store merchandising for image brands,” Croatt said. “This new chapter for Winston will allow us to expand our reach and customer service for our current and new clients. Our goal is to offer exceptional services within the marketplace that exceed our competitor set. Our main focus will continue to be visual merchandising, store design, sales staffing and pop-up consumer experiences for brands and retailers, as well as expanding our technological capabilities.”

Katz said the deal is “a three-tiered win. First, it allows Randa and MCG to focus our internal service team and resources to provide Randa and Haggar with dedicated, best-in-class in-store merchandising, market research, and value-added services — all in furtherance of making their brands and products look great and sell quickly. Next, it provides MCG’s external clients with an extraordinary new partner to work with them on the creation of powerful visual merchandising and brand building at point-of-sale.”

Winston, which has offices in New York and San Francisco, was formed in 2003 and employs art directors, designers, project managers, architects, visual merchandisers and stylists that work with some 110 brands and retailers. With the acquisition, Croatt said Winston is expected to bring the total number of employees to nearly 3,000.

2020-01-13T14:42:57+00:00