The cult urban denim brand True Religion has ambitious plans to reach $1 billion in revenue in the next five years. According to CEO Michael Burkley, the brand’s growing physical retail fleet will be key to meeting that goal.True Religion announced on Monday the planned addition of at least four physical stores opening in markets like Indiana, New Jersey and California this year. The brand already has over 60 stores in the U.S. and plans to open 90 more, to reach 150, in the next four years.
Burkley said that recent store openings in markets have already proven wildly profitable for True Religion, with an average EBITDA profit margin of over 45%. The Boston and Orlando stores have been particularly profitable, he said. Direct sales, which make up about 65% of the business, are now roughly evenly split between online and in-store, while the rest of True Religion’s revenue comes from wholesale partners like Nordstrom in the U.S. and third-party-operated stores in Europe.
Burkley said a few key factors have made True Religion’s stores a success. First, they’ve opened in markets with proven True Religion customer bases, and the brand has often doubled up in lucrative markets, including Florida and New York. Second, each store is relatively small, at around 250 square feet, but each is treated like a flagship. That means every store carries the full breadth of True Religion’s men’s, women’s and kids’ clothing collections, along with items from each of its 12 categories of accessories and fragrance.
