SIRENA'S EXPANDING BASE

Byline: KIM-VAN DANG, with contributions from ANNE D'INNOCENZIO, New York

LOS ANGELES--Sirena Apparel Group Inc., whose roots are in the misses' market, wants to widen its consumer base and price points, as well as its distribution channels through a multifold corporate strategy.
The South El Monte, Calif., swimwear firm is talking about adding new brands, as well as brand extensions and the development of its private label programs, according to Doug Arbetman, president and chief executive officer.
Sirena, which went public last August, is also counting on an aggressive acquisition strategy that will take the company beyond its seasonal swimwear business. Arbetman said Sirena is currently negotiating with a woman's active sportswear company, but he would not identify the company. He said a deal is expected to be signed in about three months.
"This next year will be the most exciting one for us," said Arbetman, who joined Sirena in 1990.
The last few years have been good ones for the company.
Sales for the fiscal year ended June 30, 1995, reached $49.2 million--a 23 percent increase over the year before. Since Arbetman came on board, the company has experienced at least a 20 percent annual increase in sales. According to a recent NPD study, Sirena is the second top-selling swimwear brand at retail, with Jantzen number one.
Arbetman said that through improved EDI and Quick Response systems, he plans to penetrate every major department store and beef up the company's specialty chain business. Some of the major department store accounts are Lord & Taylor, Saks Fifth Avenue and Dillard's.
Just a few years ago, Sirena did only $600,000 in sales in the New York metropolitan area with department stores; now, the company does in excess of $3 million.
Department stores currently account for 67 percent of sales, while specialty stores garner 20 percent. Mass chains like Sears, Roebuck; Wal-Mart; J.C. Penney, and Kmart account for the remainder. Arbetman aims to have specialty stores reach 25 percent within the next year or so, since he believes such channels are less demanding on manufacturers. The new specialty store business, he said, would take away "a little" from his department store and mass chain volume.
In particular, Arbetman is counting on a savvy internal merchandising growth plan to keep sales pumping. The merchandising changes, most of which will be implemented for cruise '96, will result in a mix of 55 percent misses', 25 percent contemporary and 20 percent designer. Before these changes, misses' accounted for 85 percent of business. Contemporary, which played a minor role until this past year, is now considered a big growth opportunity, Arbetman said. For starters, the company, which has held the swimwear license for Anne Klein since 1987, will begin producing swimwear for its bridge label, A Line Anne Klein. The first group--unveiled at ISAM in July--consists of bright, bold suits with a decidedly active flair. Colors include turquoise, coral, lime, black and white. Price points are lower than thesophisticated Anne Klein label, wholesaling between $30 and $40. Anne Klein's line has been upscaled, and now tops at $100, compared to the previous price of $65.
Sirena has also signed a license with the American Red Cross to produce cotton and Lycra spandex tank suits featuring the Red Cross emblem as well as photo prints of wartime Red Cross posters. The first 20-piece group--also being rolled out at ISAM--wholesales from $30 to $35.
Arbetman is restructuring the remaining brands in his stable. Sirena, the company's largest division, is being split in two: Sirena Signatures and Sirena Concepts.
Signatures will consist of familiar silhouettes that retain the label's misses' features: power nets, tummy control, sheering, bra construction and a 62-inch torso.
Concepts is geared for a more contemporary customer. Textured and shiny fabrics in bright colors, including yellow, lime and hot pink, help to differentiate it. So do new, briefer silhouettes.
"It won't have all the typical body camouflage,"Arbetman said, adding that the torso in Concepts suits will be only 60 inches. Wholesale price points for the Sirena division are $30 to $38.
Rose Marie Reid, a brand the company acquired in 1994, has also been revamped into two labels. Rose Marie Reid will remain suits for the mature customer at $26 to $35 wholesale, Arbetman said. Doladio By Rose Marie Reid will feature European print fabrics in muted colors. Print stories include animals, Far East-style patterns and jewel tones inspired by ErtA paintings. The new label wholesales from $30 to $40.
Look & Sea, the cotton and Lycra division for women and girls, will feature swimwear studded with novelty nailheads at $30 to $33 wholesale.
The company's WearAbouts coverup line continues to be successful, according to Arbetman. The line, which includes cotton interlock, gauze and french terry, wholesales from $10 to $36. In fiscal 1994, the label grossed $5.7 million, up from $4.5 million the previous year.
Arbetman is also counting on its private label program, which was launched three years ago and now generates sales of $13 million. The company does private label with Penney's, Sears and Kmart.
"We knock ourselves out before the competition does," said Arbetman. Jennifer Block Groves, an analyst with Groves & Co., noted that at Wal-Mart, Sirena's padded bikini is the top-selling junior bikini. At Penney's, for which Sirena has been doing only private label, sales have been growing at a rapid pace. This year, Sirena shipped $3 million to Penney's, up from $700,000 last year. Next year, Groves estimates that the figure could reach $4 million.
Groves applauds Sirena's moves into various brands and added, "To do different strategies, you need to have a management team that is capable of executing these new strategies. Arbetman is not only a great executive but a great merchant. I've watched him work. He's just incredible."

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