J.Crew To Bring Outsourced Tech Operations Back In-House

The retailer will opt instead to upgrade its information systems, according to SEC documents.

Paul McDougall, Editor At Large, InformationWeek

January 17, 2007

2 Min Read

Preppy cataloger and retailer J.Crew Group is reeling in computer work that the company previously outsourced to a service provider, according to a document the company filed Wednesday with the Securities and Exchange Commission.

"We have taken over certain portions of our information system needs that were previously outsourced to a third party and plan to make significant upgrades to our information systems," said the document, a prospectus that J.Crew filed in connection with a share offering.

According to the document, J.Crew is also considering repatriating additional IT work. "We may take over other outsourced portions of our information systems in the near future," the company said in the filing.

J.Crew did not specifically state the outsourcer from which it is pulling back work. In the same filing, however, the company states that it has "an agreement with Electronic Data Systems, a third party, to provide services and administrative support for most of the information systems in our headquarters, stores, and distribution and call center facilities."

J.Crew initially handed the contract, worth $40 million, to EDS in February 2001. The deal was implemented under former J.Crew CIO Paul Fusco, who left the company in 2004. J.Crew COO James Scully did not return a call seeking comment. Officials at EDS were also not immediately available for comment.

If J.Crew is indeed terminating its outsourcing contract with EDS, it would represent the end of a relationship that once appeared to be rock solid. Following the Sept. 11, 2001, attacks on the World Trade Center, Fusco praised EDS for helping his New York City-based company resume normal operations as fast as possible. "You guys executed this absolutely flawlessly," Fusco said in a letter to EDS that's archived on the outsourcer's Web site.

About the Author(s)

Paul McDougall

Editor At Large, InformationWeek

Paul McDougall is a former editor for InformationWeek.

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