Monday, June 13, 2011

Jan Cameron makes her move on Kathmandu

Jan Cameron has made her first move, after a restraint of trade was lifted on May 2, to compete directly with the company she sold in 2006 Kathmandu Ltd [KMD.NZX].

It has been reported that she has invested an initial 20 million into kiwi outdoor clothing chain, Macpac to go head to head with KMD in Australasia and presumably in other markets KMD trades in. She is one smart cookie whose business acumen in retailing should never be underestimated by her competitors and she has strong contacts in retail and retail suppliers in this part of the world and elsewhere and her expertise in the outdoor retail sector cannot be underestimated.

Cameron has several individuals within Macpac that are former associates at Kathmandu and they have an aggressive expansion plan in place to take on KMD.

While Macpac currently has fewer branded stores than Kathmandu's 100, with only 29 in Australasia, Macpac's products are stocked in over 100 retail outlets worldwide so have a broader brand recognition if a global business is what management are looking at in the long term.

Kathmandu as a strong in your face brand have the outdoor sector mostly to themselves in New Zealand and Cameron's expertise and contacts in retail will be a formidable challenge to Kathmandu and its impressive retail margins that they have placed their whole business model and recent IPO on.

Management at KMD will be seriously worried about this and as Macpac gets a larger retail footprint across this part of the world revenue and profits will be cut.

Make no mistake it will be cutthroat between these two brands and the winner will be the consumer in the end.

It remains to be seen which retailer will come off the big winner but my money is on Jan.

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c Share Investor 2011

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