By  on November 7, 2006

Two years after scrapping its design and sales teams and relaunching a better dress collection, Donna Morgan's sales have climbed 25 percent to $35 million in wholesale from $28 million.

"This line has become 15 years younger from what Donna Morgan was originally," said Kathleen McFeeters, president and chief executive officer. "The key is keeping a sportswear head when you are designing dresses."

McFeeters and Donna Morgan started the company in the early Nineties. In their first year, McFeeters said the firm did $13 million in wholesale, and within five years grew to a $40 million business.

Then came the perfect storm for better-priced dress vendors. Everything was about sportswear. Contemporary entered the equation. Retailers consolidated. Private label escalated. And Donna Morgan's business shrank to $28 million.

The firm puttered along, doing bridesmaid dresses for a few years. It froze the slightly higher-end, more mature Morgan McFeeters line, just relaunching it for fall 2006 with Lord &Taylor.

McFeeters knew it was time for change. "As sportswear started getting younger, all of us dress people weren't changing fast enough," she said. "Three years ago, I said to Donna, ‘We are in a rut and we need to change. We need to bring in people with fresh ideas.'"

By spring 2005, the full effects of the new design team were visible in the line of Donna Morgan dresses, which has a Diane von Furstenberg look, yet wholesales from $59 to $79.

"The whole idea in getting young people involved is keeping it affordable and at a price point where you get multiple purchases," McFeeters said. "We think the growth in our collection will come from going down as opposed to going up. Since stores like H&M, there's no stigma to going cheap chic — it's seen as savvy."

Department stores, including Federated, Dillard's and Parisian, carry the line. Donna Morgan's new sales team also has found a home for the collection in specialty stores.

"Sportswear specialty stores that never carried dresses are now selling them almost like tops,'' said Rick Self, president of sales for Donna Morgan. "It's creating a whole other customer base for us. Dresses used to be in the back of a store, and now they are in the front. Every store has a dress in the window."Of course, any dress company worth its Little Black Dress has been prospering during the dress cycle. At Donna Morgan, they are banking on the prediction that the trend will last seven years.

The company also is expanding strategically. Now at 15 percent of business, private label services continue to grow. Donna Morgan went international last year, and is enjoying success in London, which executives attribute to the price point. The company has honed its turnaround time to less than a month, even with sourcing in Asia.

In addition, Donna Morgan is looking at alternative sales channels, including e-commerce and a newly packaged product geared for airports and hotels. Under the new label "When all she needs…" the company is selling a jersey mock-wrap dress, likely for $59, packed in a box small enough to fit into a laptop case or purse.

For spring and summer, Donna Morgan is spotlighting sheath, trapeze, maxi, baby-doll, jumper and — of course — wrap styles, using cotton, jersey and silk matte crepe fabrics and featuring details such as pockets, belts and pleats.

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