Calvin Klein Shuts Down Its Luxury Collection

Category: Business


Unlocking Word Meanings

Read the following words/expressions found in today’s article.

  1. partial to (something) / ˈpɑɚʃəl tuː / (idiom) – showing preference for something

    The company is partial to selling products for middle-class consumers instead of selling high-end items.

  2. high-profile / ˌhaɪˈproʊfaɪl / (adj) – attracting public attention

    The company’s high-profile advertisements led to an increase in sales.

  3. endorsement / ɪnˈdoɚsmənt / (n) – the act of publicly showing approval or support for someone or something

    The famous actor’s endorsement of the new clothing line boosted the company’s sales.

  4. scrap / skræp / (v) – to stop or get rid of something because it is unnecessary or unwanted

    The board members scrapped the project because it did not make enough profit.

  5. dent / dɛnt / (v) – to lessen something

    Spending $200,000 will definitely dent my savings.


Read the text below.

American fashion house Calvin Klein is shutting down its luxury collection and plans to focus on its other lines, such as denim, underwear, and perfume.

Calvin Klein is closing down its high-end men’s and womenswear line, three months after the resignation of the company’s creative director Raf Simons. Simons’ departure came after Emanuel Chirico, the CEO of Calvin Klein’s parent company, expressed his disappointment in the lack of investment return on Simons’ project. In fact, Calvin Klein’s profit declined to $121 million from the $142 million that it made during the third quarter of last year.

Aside from the decline in sales, Chirico criticized Calvin Klein’s product direction, saying that it was partial to high fashion. The company also failed to deliver expected profits despite the high-profile endorsement from the famous Kardashian family.

After Simons’ resignation, the company initially planned to rebrand the high-end collection but decided to scrap it entirely. Instead, the company will prioritize its denim line. Calvin Klein believes that this new strategy will not dent sales because denim and underwear products are already the brand’s biggest sellers.

Calvin Klein’s decision to close down the high-end collection led to the decision of dismissing about 100 employees. The company is also planning to shut down its New York and Milan offices as it moves forward into a new direction. With this, Calvin Klein is working on proper dismissal measures for employees while also searching for a new creative director for the company.

Viewpoint Discussion

Enjoy a discussion with your tutor.

Discussion A

• Do you think Calvin Klein made the right decision to scrap its luxury collection? Why or why not?
• Aside from making its denim collection the company’s priority line, what else can Calvin Klein do to regain its profit? Explain.

Discussion B

• What do you think are the usual risks of investing in new projects? Explain.
• How can companies lower these risks when creating or investing in new projects? Discuss.