Currently, the biggest challenge among most everyone in fashion is the supply chain. Shutdowns at factories, congestion in the ports and delays in shipping have all contributed to headaches across brands’ operations.
Michael Rempell, chief operating officer at American Eagle Outfitters Inc., was in the thick of it this year, overseeing operations for the $3.7 billion-dollar company. AEO took a novel approach to overcoming shipping delays, heavily investing in supply chain infrastructure solutions. In August, the company acquired air logistics company AirTerra for an undisclosed sum. And Rempell said it plans to acquire Quiet Logistics, a supply chain company specializing in order fulfillment and return management, at the beginning of 2022. AEO has worked with the company for years. AirTerra reaches 61% of the country.
The acquisitions were an unusual move for the brand, which has only acquired two companies, both of which were clothing companies, in the last two decades.
Rempell said the acquisitions have already had a tangible impact on the company’s business. In the quarter ending on May 1, 2021, AEO delivered products an average of 1.5 days faster than it did in 2019.
“Having an agile, sophisticated, technology-led supply chain is increasingly critical to the success of any business today,” Rempell said. “We have lowered delivery costs, delivered faster to our customers and increased overall inventory efficiencies. I’m really proud of how AEO is leading the way for the supply chain of the future.”
Rempell said his focus of making American Eagle a shipping and logistics company with its own internal infrastructure will continue into 2022. The company has made several other investments in the space.
“I am incredibly excited about the major growth opportunities ahead for our supply chain organization,” Rempell said. “We have recently invested in Ghost Retail, a live video shopping app to further elevate our customer experience, and in Radar, a software solution powered by RFID and computer vision to improve efficiencies. Both of these businesses demonstrate meaningful growth opportunities.”
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