Left to right: Graham, Larry, and Ian Rosen represent the second and third generations helping sustain and growth the Toronto-based luxury menswear store, Harry Rosen, founded in 1954.Peter Power/The Globe and Mail
At Harry Rosen, the 71-year-old family-run men’s clothing store, each new generation to take the helm must find their unique contribution to the business’s legacy. The third generation of the Rosen family, now in top management roles, arrived at a tumultuous time in retail.
“We often say internally, if you dislike change, you’re going to dislike irrelevance even more,” says Ian Rosen, 35, the Toronto-based company’s president and chief operating officer. “We kind of used that [mantra] to shock ourselves into the modern era.”
Ian joined the company in 2018, first as an executive vice-president of digital and strategy, before taking the president and COO job in early 2022. His younger brother Graham, 33, joined in 2022 as vice-president of the outlet division before becoming executive vice-president of strategy and corporate development about a year later. Their father Larry, 69, joined the business in 1985 and remains chief executive officer, a role he took over from his father, the founder Harry Rosen, in 2000.
Each generation has been tasked with helping to transform the luxury menswear store founded by Harry and his brother in 1954 as a made-to-measure menswear store in Toronto’s Cabbagetown.
“I can’t give enough credit to my father as a visionary,” Larry says of Harry, a Canadian fashion retailing legend and philanthropist who died in December, 2023 at 92. “He was an entrepreneur … I brought more business structure to the company.”
Over seven decades, the business has weathered recessions and downcycles in menswear trends. It’s thrived amidst the rise of fast fashion and survived U.S. giants Nordstrom and Saks Fifth Avenue’s incursion into the Canadian market.
Today, the company stands as a multigenerational success story. The business generates $300-million in sales annually, employs more than 1,000 people and has 18 locations across Canada.
Much of that success comes from careful succession planning, something Larry prioritized when he took over the company from his father.
The succession between Harry and Larry had been a success, but most of that was due to luck, admits Larry.
“It wasn’t an intentional, well-thought-out succession,” he says.
He wanted to take a more deliberate and methodical approach to bringing his sons into the business, so he enlisted Devin DeCiantis, managing partner at Lansberg Gersick Advisors (LGA), a family enterprise advisory, to help develop criteria for transitioning the next generation of Rosens into the family business.
First, they had to understand the history, legacy and financials.
“I started making disclosures when they were teenagers,” Larry says. He showed the financial statements for the business and gave them an idea of how it worked from the inside.
Second, they had to come with credibility, which to Larry meant an MBA and at least five years of outside work experience with good companies.
Third, they had to take a position at the company that matched their skills.
“It’s not about nepotism; it’s about a real need in the company,” he says.
Mr. DeCiantis says he started working with the business before the third generation got involved.
“We got a chance to imagine what the future might be like and prenegotiate how that future would affect the family members,” Mr. DeCiantis says.
It eliminated the ambiguity and included discussion about oversight, compensation and performance assessments. It also laid out plans for family members like Daniel, 37, a lawyer and the oldest of the third generation, who opted to take a non-management role in the business.
“This wasn’t about Ian, Graham or Daniel; this was a process that all of the family, including Larry, his wife and the three boys, got to discuss together,” Mr. DeCiantis says.
Part of that structure also included creating space for Daniel as a governing owner who was not involved in day-to-day operations. In the role, Daniel participates in structural and transformational transactions such as major acquisitions, dispositions, and executive selection.
The approach to succession has paid off, with each family member finding their niche.
Ian, the first of the third generation to enter the business, spent his post-MBA years working with consultant Bain and Co. and retailer Indigo Books and & Music Inc. to develop digital strategies. He entered the family business with an eye toward digital transformation.
“Larry had just put $100-million into a big capital expansion to fight off the invasion of Nordstrom, Saks and other U.S. retailers into the market,” Ian says. “My fear joining was we’ve made that big investment – are we stopping there?”
“We were a very mediocre player (online),” Larry admits.
Ian became instrumental in pushing the digital transformation, says Nicole Haggerty, an associate professor in digital innovation and information systems at Western University’s Ivey Business School. It positioned the business to thrive during the pandemic.
“They had already started thinking about options for disentangling the front-end things that they wanted to be able to do from the backend and recreating the backend to their technical platform that would allow them to do it,” says Ms. Haggerty, who wrote a case study on the business.
The changes helped them preserve their hard-won legacy.
“I really see it as a success story of amplifying the luxury customer experience, not replacing it with digital,” she says.
Graham joined in the aftermath of the pandemic, drawing experience from his time at consulting firms McKinsey & Co. and Accenture Inc. and Canadian e-commerce company Shopify Inc. He arrived amid a cost-of-living crisis and a fragmented retail environment.
“What was really important for me when I was looking to join the business was ‘what’s the opportunity for me to do something substantial and meaningful?’” Graham says. “Ian and Larry approached me about taking on the outlet division and re-imagining the strategy, bringing it up to the standards of Harry Rosen and really the changing outlet world.”
Today, the business continues to be a cornerstone of Canada’s men’s clothing market.
Much of that success comes down to a sense of ownership and accountability. Both Graham and Ian’s children are still young. However, Ian says they plan to follow Larry’s lead when the time comes.
“I think the best practice is using that board to keep them accountable – clear expectations for what they need to bring to the table,” he says. “That’s going to be the mechanism that allows us to keep every (generation) engaged.”