Three years after French Vente-Privee crossed the Atlantic to join forces with American Express, the credit card company has revealed it will close down Vente-Privee USA at the end of the year.
"Road to profitability longer than expected"
"Both companies decided that given the road to profitability for vente-privee USA was going to be longer than expected, it was time to focus on other priorities", American Express spokesperson Leah Gerstner said.
The French leader in "flash sales" had convinced the credit card market leader in 2011 to create an American joint venture for the affluent American Express user. "We know of a great number of American companies that have come to Europe and now it is a French site, with its own business model, that has come to America", CEO Jacques-Antoine Granjon (co-founder) said at the time.
He had hoped to get a 500 million dollar turnover in 4 years' time, but 2013 turnover barely reached 50 million dollars, as stated in a short Vente-Privee press release. By the end of the year, "Vente-Privee with American Express" will come to an end.
23 % more turnover in 2013
Vente-Privee was founded in 2001 in France and sells fashion articles at heavily discounted prices. These are usually end-of-line or from overstock and are only sold for a short period of time. Later on, the web shop added decorations, toys, sporting equipment, travel arrangements, wine and theater tickets to its product range. It has even started selling full-priced products a month ago.
Vente-Privee's 2013 turnover grew 23 % to 1.6 billion euro. The company now claims to have 22 million members across France, Germany, Spain, Italy, the United Kingdom, Austria, Belgium and the Netherlands. It is unclear how many Americans became a member, while the French are still considering a "new American business model".