Investor Alert

New York Markets Open in:

April 22, 2022, 9:42 a.m. EDT

American Eagle Chief Tries to "Uber-ize" Supply Chain

Watchlist Relevance

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    American Eagle Outfitters Inc. (AEO)

or Cancel Already have a watchlist? Log In

Apr 22, 2022 (Baystreet.ca via COMTEX) -- American Eagle Outfitters /zigman2/quotes/209429711/composite AEO +3.13% wants to master a business function that became critical for retailers during the COVID-19 pandemic: the supply chain.

Shekar Natarajan joined the apparel retailer roughly three-and-a-half years ago, and since the company has acquired two supply chain businesses for hundreds of millions of dollars and began swiftly building out a logistics platform that others companies -- even its rivals in the apparel industry -- can utilize, too.

It's a bet that American Eagle can lead the industry into a new territory of vertical logistics and dilute costs. Its peers will either emulate the model and play catchup, or lean on American Eagle long term.

American Eagle's goal, according to Natarajan, is to "Uber-ize" the global supply chain, thereby making it a shared service for retailers. His belief is that brands that compete for shoppers in clothing, makeup or home goods shouldn't also be competing over things like quicker delivery windows and cardboard boxes.

Instead, if enough businesses work together and pool resources, a conglomerate of retailers could be shipping out just as many packages daily as Seattle-based e-commerce behemoth Amazon, and hopefully at a profit, Natarajan explained in a recent sit-down interview.

He calls American Eagle's communal supply chain platform the ultimate "frenemy network."

"The only way that you could actually have Amazon-like scale, Amazon-like costs and Amazon-like capabilities -- you have to share," said Natarajan.

AEO shares ended Thursday at $17.00.


Is there a problem with this press release? Contact the source provider Comtex at editorial@comtex.com. You can also contact MarketWatch Customer Service via our Customer Center.

$ 12.85
+0.39 +3.13%
Volume: 4.26M
Aug. 12, 2022 4:00p
P/E Ratio
Dividend Yield
Market Cap
$2.18 billion
Rev. per Employee

This Story has 0 Comments
Be the first to comment

Story Conversation

Commenting FAQs »

Partner Center

Link to MarketWatch's Slice.