Men’s Wearhouse founder and longtime CEO George Zimmer is a familiar face from appearing in his company’s commercials for decades, and now he’s trying to figure out how to take the company he started back. Would the existing suit and tuxedo rental businesses mesh well with his online tux-rental and tailor-dispatching companies? A private Men’s Wearhouse (or holding company Tailored Brands, as it’s now known) wouldn’t have to answer to crowds of shareholders, but would have a lot of debt to pay down.
In a lengthy and super interesting profile in Inc. magazine this month, Zimmer talked about his past, his possible future, and how he used to smoke just about anything that could catch fire, but now limits himself to marijuana. Here’s what else we learned:
- In the ’80s, Men’s Wearhouse switched strategies in the same way Jos. A. Bank is failing to do now. The smaller chain used discounting to draw customers, and is now trying to wean customers off those discounts. Men’s Wearhouse did the same thing 30 years ago, Zimmer says, and it wouldn’t have gone well… if had to answer to stockholders. “Had we been a public company, we’d have all been fired,” Zimmer noted. He recalled that business returned in a few years, which is probably not cheerful news for the people running Men’s Wearhouse now, which is a public company.
- The company had turnover in management partly from giving out stock. While shares of Men’s Wearhouse stock might not seem like a great thing to own right now, the company had a stock-distribution program that included store managers. The program evolved so that store managers were relatively well-paid, and received about the same number of stock shares that executives did.
- Zimmer has moved on, but he hasn’t really moved on. After he was ousted, Zimmer moved on, starting two businesses that compete with Men’s Wearhouse but don’t require leasing and stocking hundreds of stores. zTailors is an on-demand service that sends a tailor to your house, and Generation Tux, an online formalwear-rental service that’s sort of like Rent the Runway for men.
He admitted that what he really wants, though, is to take Men’s Wearhouse back. The company isn’t doing great after its acquisition of competitor Jos. A. Bank, which was a move that Zimmer opposed. “The combination of what I’ve built in the past couple of years and what we created in the 40 years before would be a fantastic new-paradigm business,” he told Inc. It’s not often that the entrepreneur with two online businesses seeking to take over a stodgy competitor is 67 years old.
- The origin of his famous “I guarantee it!” line is in dispute. Zimmer likes to tell the story about how the original commercial script said something different, but he improvised a line on set that became famous. The company’s former head of marketing says that this isn’t so: the line came from a copywriter at their ad agency at the time.
- zTailors was created in part to help with the finer points of fittings for Generation Tux customers. It hasn’t taken off as a business that consumers hire directly, but is popular as an add-on service for other retailers, like Macy’s.com.
- Men’s Wearhouse in-house tailors aren’t allowed to freelance for zTailors. They historically have taken extra work on the side, Zimmer notes, but Men’s Wearhouse banned them from working for his startup. About 25% of the original tailors were also Men’s Wearhouse employees.
Fired From the Company That Made Him Famous, an Entrepreneur Seeks Payback [Inc.]
by Laura Northrup via Consumerist
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