Within a week, Woolrich was slapped with the unexpected resignations of two key employees -- Paula Kosmatka, director of merchandising and design, and Todd Yates, vice president of sales and marketing.
Yates departed the company abruptly on June 2, after leaving his letter of resignation on President Roswell Brayton's desk.
Brayton told SNEWS that "during Todd's 3 1/2 years with us, he has brought a vitality to both the product and the company. Everyone at Woolrich wishes him the very best in all his future endeavors."
He also told us that Woolrich has no immediate plans to replace Yates and that his duties will be assumed by several personnel within the company.
Yates told SNEWS that he left over philosophical differences with the company, upset with decisions that were made without his approval to place product in locations such as Cracker Barrel as well as licensing moves that Yates feels dilute the brand's equity and take the company in a direction he promised the specialty retailers it would not go.
Brayton told us that he was somewhat surprised by the reaction and that Yates knew of the negotiations and final decision to place Chamois shirts in 500 Cracker Barrel locations since, he said, "Todd is the one who approved it."
Yates responded simply, "While I was aware of the order, it was accepted and placed with our overseas sources prior to me even seeing or being able to approve the details of that order."
As for the worry that the brand is diluted by licensing the Woolrich name to pet beds and bowls, as well as blankets in Target, and other licensing decisions the company may make down the road, Brayton doesn't see it either.
"We are creating brand recognition and maximizing our exposure in select instances through new distribution channels, such as Target," says Brayton. "Specialty retail in the outdoor industry is our bread and butter and our future and we have designed our apparel line with that in mind and will continue to sell apparel only to specialty stores."
Four days later, Brayton was hit with another surprise resignation from Kosmatka, who informed Brayton of her decision the morning of June 6, less than two months after being promoted by the company.
"In my three years at Woolrich, we were able to change the product, but probably not the culture and as a result, there were irreconcilable differences with the company that led to my resignation," Kosmatka told SNEWS late Friday.
While Kosmatka told us she will be taking some time off to hike, bike and be with her husband in their home in Bozeman, Mont., Yates is beginning another job almost immediately.
Mike Egeck, president of The North Face, confirmed to SNEWS on Thursday, June 5, that Yates will be joining the company's senior management team as the company's new vice president of business development. Yates will be responsible for securing and managing strategic acquisitions for TNF as well as managing the company's licensed business and other brand extensions.
For its part, Brayton told SNEWS that Woolrich is very committed to creating a brand image that embraces the outdoor lifestyle, no different than L.L. Bean in some ways. There will soon be furniture and plates and napkins and lamps -- all items that are about lifestyle.
Rick Insley, vice president of licensing for Woolrich, told SNEWS that he hopes specialty outdoor retailers will want to carry some of the product and that the company has already been approached by a number of key dealers with requests for the outdoor furniture line.
"Anyone that likes the outdoor lifestyle, it is our goal to have a Woolrich-branded lifestyle product that they can put in their home," said Insley.
SNEWS View: There are always two sides to every story, and in some cases, a middle that is as muddy as the Mississippi. Losing the talent pool of Kosmatka and Yates is, no matter how Woolrich tries to sugar-coat it, a huge blow to its specialty retail efforts. While it may have been the corporate mandate to work extra hard to take the company back to its heritage and roots in the outdoor marketplace, over the last three years it was Yates and Kosmatka who led the charge and were the faces specialty retailers learned to trust. Even as recently as three months ago, conversations with Yates and Kosmatka were full of effusive comments regarding the fall '04 line and the direction the brand was going. We may never know exactly what happened to cause those two to depart Woolrich so abruptly after bleeding wool for three years, but gone they are.
Meanwhile, Woolrich continues down the licensing path. Clearly Yates and Kosmatka had a different opinion about the strategy. We have never been so naÃ¯ve as to believe one person or even several people define a brand's success, so it is likely that Woolrich will continue on as it has. The talent pool still at the company is very strong. It continues to be our philosophy that if you don't like the weather it's time to move and quit complaining about it, which Yates and Kosmatka did. That doesn't mean the weather is bad. It's just not your kind of weather.
We've spoken to dozens of retailers and a few branding experts, and to be frank, the path Woolrich seems to be on is not a bad one -- as long as each licensing decision and distribution decision made reflects the quality of the brand. We're not sure selling into WalMart, albeit with a different lettering style, reflects the image of quality Woolrich is seeking. Pet products in Target is dancing on the fringe of logic. And certainly selling clothing into Cracker Barrel is just plain stupid, regardless of who approved it!
But furniture, housewares, lamps and such, that embrace the image of Woolrich, is smart. Woolrich is about outdoor lifestyle and inasmuch as it can embrace that image and carry it through in all its licensing decisions, the brand will continue to gain strength -- just as long as the company remembers, distribute your apparel only through specialty outdoor retailers!
And finally, good for TNF. It's landed a real talent in Yates. Just don't expect to see him lead TNF down a path of licensing furniture, Christmas ornaments or pet products anytime soon.