By  on February 16, 2010

LOS ANGELES — Chip & Pepper, one of the pioneering brands in the premium denim industry, is switching to a licensed business model with lower price points for fall.

Responding to the challenging economy, co-founder Pepper Foster is teaming with his father-in-law, Charles Perez, and denim designer Tadd Zarubica to launch a company called Venice Intelligence. Based in Venice, Calif., Venice Intelligence will design and oversee branding for denim, footwear, handbags and home furnishings other companies will manufacture for the Chip & Pepper brand under license.

While Foster and Perez are partners in Venice Intelligence, Zarubica, the former designer of Denim of Virtue, will serve as president and brand manager. Foster’s identical twin brother and brand co-founder, Chip, will focus on operating Chip & Pepper’s freestanding stores in Toronto, Vancouver and Montreal, and will handle manufacturing for clothing sold only in Canada.

“The new equation in this economy is everyone is an expert in their area,” Zarubica said. “To create and manage product and drive your brand, that’s one function. Manufacturing is another huge component. It’s easier to find someone who can do the manufacturing and source the fabric. Chip & Pepper is design-driven, not manufacturing and administration driven.”

Founded in 2003, Chip & Pepper tried a few times to branch out from the premium denim world. The brand launched C7P, a denim and sportswear line for juniors and young men, three years ago at J.C. Penney and produced it until the deal ended last year. It spun off another moderate-price brand, Mill Iron, last year at teen retailer The Buckle.

Chip & Pepper’s premium denim brand, which retailed for more than $175, stopped most of its wholesaling business last fall, when it shipped only to its freestanding stores and a handful of specialty accounts. The line will relaunch this fall with more than 30 women’s styles, including patchwork jeans, denim leggings, motorcycle-style jeans and other best-selling products from past Chip & Pepper collections. The new retail prices will range between $98 and $130. The women’s denim will be manufactured by Makers USA in the U.S.

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