How much is Michael Jeffries worth?
| Net Worth: | $350 Million |
|---|---|
| Profession: | Businessman |
| Date of Birth: | July 15, 1944 |
| Country: | United States of America |
| Height: | 1.75 m |
About Michael Jeffries
In 1992, Les Wexner, who was the CEO of LBrands, which was known as The Limited at the time, recruited Jeffries to revitalize Abercrombie & Fitch. After filing for bankruptcy in 1988, Limited Brands made the purchase of the business that had been in operation since 1892. It is generally agreed that Jeffries was the primary architect behind the new image that was developed for the corporation.
Abercrombie & Fitch remodeled it to become an upscale clothing retailer catering to the collegiate market, and by the middle of the 1990s, they had opened hundreds of new locations. By the year 1996, LBrands’ level of involvement with the company had decreased significantly, and they eventually handed over administration of the business to Jeffries.
Jeffries spent his childhood in Los Angeles. His father, Donald R. Jeffries, was the proprietor of a series of stores selling party supplies. Before earning his MBA from Columbia Business School in 1968, Jeffries received his undergraduate degree from Claremont Men’s College and his graduate degree from the London School of Economics. Jeffries tied the knot with Susan Hansen in 1971, and the couple is parents to a grown son.
In 1968, Jeffries became a participant in the management training program of Abraham & Straus, a department store that is no longer in business in New York City. During this time period, Jeffries worked alongside Mickey Drexler and Allen Questrom, who was employed by J.C. Penney (the previous CEO of Gap Inc., who now works at J. Crew).
Jeffries established the brand Alcott & Andrews in 1984 with the intention of catering to professional ladies. After an initial period of success, the company ran into financial difficulties in 1989 as a result of its rapid development and ultimately shut down. After that, Jeffries got a job at the Paul Harris clothing chain, which is located in the Midwest.
During this time period, A&F has been the subject of several lawsuits and has been the subject of controversy from a variety of groups, including the feminist movement and the American Decency Association.
A man who is not afraid to speak his mind, businessman Jeffries has been reported in the media making views that are capable of being construed as contentious. The comments in question include his assertion that “In our stores, we only hire attractive people to work there. Because attractive people tend to attract other attractive people, and we want to promote to people who are both cool and attractive, this is why. We do not market to anyone else save those people.”
After a scandal surrounding his “excessive compensation,” he made around $25 million USD in 2004, which included a “stay bonus” of $6 million USD. Prior to the controversy, the “stay bonus” was $12 million USD. The Corporate Library determined that Jeffries was the “Highest Paid Worst Performer” of 2008 after conducting a poll of 2,000 US firms. This was due to the fact that he earned a remuneration package with a value of $71.8 million.
During the slump in the retail industry, Jeffries refused to drop pricing or offer discounts at Abercrombie & Fitch locations until September 2009, after the business had suffered same store sales losses for 17 consecutive months. The employment arrangement between Jeffries and the company scheduled to end on December 31, 2008.
A&F corporate made the announcement that it had been renewed on the 22nd of December in 2008. On February 22, 2014, it was no longer valid.
During an interview in 2006 with Salon, Jeffries remarked that his clothing business catered solely to individuals who were considered to be “cool” In addition, he has been quoted as saying that he does not want people who are overweight or unattractive to wear his garments. The comments, which were discovered in 2013, resulted in the company receiving unfavorable exposure as well as criticism.
On May 15, 2013, Jeffries issued a public apology for his comments, claiming that “We are completely opposed to any discrimination, bullying, derogatory characterizations or other anti-social behavior based on race, gender, body type or other individual characteristics”
The economic crisis that began in 2007 and continued into 2008 caused a drop in sales in 2008, although they began to rise again in 2011. It is estimated that he received a total compensation of $46,609,075 in 2011, the vast majority of which came in the form of stock options.
Because Jeffries owned approximately 2.9% of the company’s shares as of 2012, it was difficult to fire him without first obtaining his consent. At that time, his recent contract said that he would be entitled to a payout of more than one hundred million dollars in the event that he was fired because of a change of ownership.
The first time that Jeffries’ expectations for the cabin crew on Abercrombie’s Gulfstream G-V Jet, which he, Smith, and their dogs utilize, were brought to public attention was in October 2012 by Bloomberg News.
As part of their job uniform, the male models who work as stewards on the corporate jet are forced to wear Abercrombie-branded polos, jeans, boxer underwear, and flip-flops. They are also expected to apply a “spritz” of cologne to their upper bodies. After that, this information became public knowledge as a result of a lawsuit in which it was alleged that Jeffries sacked his own jet pilot in order to replace him with a much younger man.
After the presiding judge ordered Jeffries to testify in the case, the parties were able to promptly settle the lawsuit out of court. The male house employees for Jeffries were hired by the same modeling agency that also provides male workers for the corporate jet. These services were paid for by the Jeffries Family Office.
On December 9, 2013, it was reported that Jeffries had reached an agreement with A&F over a new contract that would make his remuneration dependent on the performance of the company. In the same month, market expert Herb Greenberg ranked Jeffries as the company with the poorest CEO performance in 2013. Greenberg mentioned that the share price for Abercrombie & Fitch had dropped by forty percent over the course of the previous year. This was in response to the fact that Jim Cramer of CNBC had previously included Jeffries to his “Wall of Shame”.
Once considered one of the highest-paid CEOs in the retail industry, Jeffries experienced a 72 percent decrease in the amount of his remuneration in 2013. During the 2013 fiscal year, which came to a close on February 1st, his total compensation was $2.24 million. That was a decrease from the previous year’s total of $8.16 million and the year before that’s total of $48.1 million.
According to a report on Salon.com, Jeffries identifies as a “gay man” and has a private residence apart from his wife. As of the year 2013, it was stated that Jeffries was sharing his home with his partner, Matthew Smith, as well as three canines. Smith served as the head of the Jeffries Family Office, which is a limited liability company in the state of Ohio that “advocates for the personal interests of Abercrombie’s CEO.”
Smith was also responsible for reviewing internal Abercrombie & Fitch documentation and providing real estate consulting services. Since he did not hold any formal role in the company, his engagement with Abercrombie & Fitch was viewed by some as an example of bad corporate governance. His involvement was questioned in some places. Jeffries was removed from his position as CEO of Abercrombie & Fitch in 2014 as a direct result of Smith’s involvement in the company.
Amidst widespread criticism of the business’s performance and 11 consecutive quarters of declining company comparable-store sales, A&F CEO Jeffries resigned from his position on December 9, 2014, citing “personal reasons.” Following the announcement of the change, the stock price increased by 8%, representing the greatest one-day rise in the market in more than nine months.
The metamorphosis of Abercrombie & Fitch into a “avatar of exclusivity and soft-core sex appeal.” was the primary focus of the 2022 Netflix documentary White Hot: The Rise & Fall of Abercrombie & Fitch, which examined Jeffries’ tenure as CEO of Abercrombie & Fitch. The film was released in 2022. The events leading up to a class-action lawsuit being filed in 2003 against the firm are the primary focus of the film.
Summing-Up
From 1992 until 2014, Mike Jeffries was the Chief Executive Officer of the clothing business Abercrombie & Fitch. While Jeffries was CEO of Abercrombie & Fitch, the company transformed from a “fashion backwater” that lost $25 million year to a lifestyle brand that brought in $2 billion annually by 2006. This change occurred under Jeffries’ tenure. In spite of the fact that Jeffries has been very successful, he has been subjected to significant backlash due to the fact that he advertises his company with models who are only partially clothed, sells clothing with slogans that are racially and sexually insensitive, and openly maintains that Abercrombie & Fitch caters only to “cool kids.”
