Scotch & Soda parent company breaks silence: CEO on store openings, partners and growth

American group Bluestar Alliance is the owner of Dutch-heritage brand Scotch & Soda. Since its take-over in 2023, however, it has not all been smooth sailing. CEO and co-founder of Bluestar Alliance Joseph Gabbay shares the plans for the brand and the current market.

For readers that don’t know Bluestar Alliance yet, can you explain what the company does and how it works?

Bluestar Alliance is a brand management company. My partner and I co-founded Bluestar Alliance in 2006, to create a portfolio of brands – we own, manage and market a distinct range of global consumer brands across many tiers of distribution. We have an established network of partners, licensees and franchisees, alongside a retail platform, that we work with to grow brands to their full potential.

Is Bluestar in the market for any other take-overs of brands or companies at the moment?

We are always exploring brands and businesses that interest us – brands that boast a strong heritage, brand DNA and value proposition in the market. My partner and I carefully consider all acquisition opportunities to ensure any brand or business we take on fits strategically, and uniquely, in our portfolio.

Bluestar Alliance is known for working with American brands. What differences have you found when working with a European brand like Scotch & Soda?

All brands and businesses come with their own history, infrastructure, and network of resources and opportunities. It’s always interesting to learn about a brand’s unique mission, product and customer. The Scotch & Soda brand has always stood out in the market, and the passion that the global customer has for the brand is very inspiring. When it comes to American Brands vs European brands, there are different considerations in terms of approach to product design, categories, best- sellers, styling, seasonality, marketing and customer experience preferences.

As we look to build the Scotch & Soda brand, we are considering the brand’s heritage, the markets we are the strongest in and ways to offer the brand that is tailored to each market. We have many exciting opportunities for Scotch & Soda, with great worldwide growth to come.

Bluestar Alliance acquired Scotch & Soda more than a year ago, but has stayed silent about the plans so far. Can you enlighten us on future plans for the brand?

After acquiring a brand, there is an assessment that must be done – across the organisation. Considerations include a restructuring of the business and its partnerships. More specifically, considerations may include product, operations, real estate, distribution strategy, and more. Since the acquisition we have carefully reviewed all aspects of the business and identified talent, licensees, franchisees, partners and a marketing approach that will position Scotch & Soda to have the platform required for greater worldwide success now and in the years to come.

Some of our recent announcements include Joe Jonas as our brand ambassador for Fall 2024-Spring 2025. Most recently we have opened our new flagship on Carnaby Street in London, we will open another flagship store in NYC in September, two more locations in NYC and one in West Palm Beach. We will continue to open more stores in markets of opportunity. We have found retail partners that will be opening locations in Belgium, Lyon, Touquet and additional locations in France. In addition, locations will open in Vienna, Riyadh, Albania and more as we continue reviewing the landscape. As we expand our retail partnerships, we are expanding our global sales force with new showroom locations opening to serve our customers, including our most recent showroom addition in Valencia, Spain.

As we develop our assortment to serve more customers, we continue to focus on those categories for which the Scotch & Soda brand is known, including men’s and women’s denim, knitwear, men’s suiting and kids. The brand was built upon the inspiration of the city of Amsterdam, and the creativity and freedom of expression for which the city is known will continue to be woven into the collections in the future. For Pre-Fall 2024, we have partnered with The Embassy of the Free Mind, and we intend to stay true to the heritage of the brand and the celebration of freedom thinkers.

The structure of Scotch & Soda in Europe seems rather complex, with franchise organisations, wholesale activities with different companies and retail in a separate company. Can you expand on this?

Bluestar Alliance owns Scotch & Soda, and we have a carefully selected network of licensees and franchisees that we partner with around the world – with each overseeing select product categories, wholesale relationships, retail locations, ecommerce operations and/or territories.

Logistical problems have been named as the reasons behind the bankruptcy of the European retail branche of Scotch & Soda. Can you tell us more about the reason behind the bankruptcy and how it came to this?

Until the recent takeover by United Legwear & Apparel B.V, the EU retail market was operated by S & S Europe B.V., a regional third party retail licensee that was led by members of previous brand management that was not successful. However, this bankruptcy presented an opportunity for us to select a very well established, financially secure partner, to overtake a portion of the operations. We are continuing to expand the Scotch & Soda business and are identifying new licensees and franchise partners to take on markets and retail management in those impacted areas, as well as in new areas of opportunity.

What will the future of Scotch & Soda in Europe look like?

Following management’s assessment, we have developed a roadmap for the brand’s organisational structure that will allow us to concentrate resources in territories that offer the best potential for growth. We are committed to maintaining a robust presence across Europe, and Scotch & Soda will see a growing retail footprint and wholesale presence in current and new markets in the seasons to come.

We have plans to grow our EU e-commerce presence, in partnership with United Legwear and Apparel B.V., as recently announced, and we will continue to open more standalone stores, shop-in-shops and presence at new points of retail distribution, across mens, womens and kids.

Bluestar would like to add 30 additional Scotch & Soda stores worldwide in the coming year. Why did you choose this strategy, given that Scotch & Soda’s bankruptcy in 2023 was due to an expansion plan that went too fast?

Scotch & Soda is a beloved brand with incredible potential. Following the strategic reorganisation and new brand management we have put in place, we are committed to giving customers and brand loyalists the customer experience they are seeking. As part of our strategy, those underperforming stores with high rental costs in limited territories have closed, allowing the global business to concentrate resources on high performing locations, as well secure new locations, that present the potential for growth and customer engagement.

You want to double Scotch & Soda in the European market. What is this prediction based on?

Based on the assessment of the global business, including all wholesale, retail and e-commerce operations, we have determined that following our strategic reorganisation of the brand, alongside our licensees and franchisees, the business will be positioned for double the growth in the European market.

This interview has been conducted in written form.