Amazon Is Collecting Private Label Fashion Brands

Amazon Is Collecting Private Label Fashion Brands
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Amazon already owns seven private label fashion brands, and it's probably going to expand it even further, according to KeyBanc Capital’s Ed Yruma.

According to a note published by Yruma, Amazon has at least seven of its own trademarked brands that are already selling through the e-commerce site, including: Franklin & Freeman, Franklin Tailored, James & Erin, Lark & Ro, North Eleven, Scout + Ro, and Society New York.

The note, first reported by fashion site WWD, said these brands have a total of 1,800 products listed, ranging from men's shoes to women's scarves and children's clothing. The price seems moderate (a men's suit costs less than $300) and the styles are pretty casual, reminiscent of the looks of UNIQLO or H&M.

“Apparel is a large category that remains highly fragmented. We think the low barriers to entry, size, and significant competitive set make this an attractive category for Amazon," Yruma wrote.

The news comes on the heels of recent reports indicating Amazon ramping up hiring for its fashion team. One recent opening said it is "looking for a dynamic senior brand manager to drive the DNA and face of a new brand," while another position we found under the senior software engineer position describes the position as, "When you think of buying new clothing, shoes, watches and jewelry, do you think of Amazon? Not yet? Well, we are going to change that."

Fashion is a relatively high-margin business and it could contribute to Amazon's profitability, too. Yruma anticipates Amazon's focus on clothing will add at least $0.25 in EPS by as early as next year.

Amazon has been increasingly spending more on fashion lately, scooping up online fashion stores, like ShopBop, MyHabit, and EastDane. Last year, it sponsored the New York Men's Fashion Week for the first time, too.

And all this could lead to Amazon eventually dethroning Macy's as the largest apparel retailer in the US. According to new research from Cowen Company, Amazon's expected to own 14 percent of the total US apparel market by 2020, up from the 5 percent it accounted for in 2015.

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