Accessories makers use the luxury trend to slay the competition.
Luxury leads the accessories market.
As manufacturers have sourced finer materials, established stronger brands or switched to a contemporary direction, high-end looks have trickled down to all price points. Vendors report global economic and weather conditions worked in favor of business last year, with only a few minor blips from natural elements, such as an extensive rainy season in Madagascar, labor shortages in China and the rise of the yuan versus the dollar.
Consumer appreciation for luxurious qualities like buttery leathers, realistic embossing, fashion colors and novelty hardware is driving sales at Donald J. Pliner Handbags, a New York bag and belt division of the shoe company of the same name.
"They've learned that our styles are real accessories and not just functional, basic black bags. Women are changing their bag more often than usual, too," said western region sales executive Ro Gallant-Brown.
The division, launched in 2002, had sales increases of 45 percent in 2005, due to a better product mix, brand recognition through heavier advertising and the company's established shoe business, and more distribution channels, including Parisian, specialty stores and Nordstrom's shoe salons and Web site, according to Gallant-Brown.
As designers, factories and communication have become more sophisticated, Donald J. Pliner Handbags has suffered fewer setbacks, she said. The Couture collection, which is manufactured in Italy and correlates with shoes, wholesales from $125 to $450. For the Collections group, which wholesales from $50 to $200, Italian materials are assembled in China, a strategy she said cuts costs 40 percent.
To reach more women's boutiques, the company began exhibiting at WWDMAGIC three years ago. Gallant-Brown opened approximately 40 accounts at August's show.
"Along with New York shows, MAGIC presents the most varied customer for us. We get lots of international business there," she said.
This February marks SolarEx Sunglasses' first time at WWDMAGIC, according to Mike Thompson, director of sales for the eyewear and eyewear accessories company based in Cleveland, Ohio, and Gilbert, Ariz. He hopes to expand on its success at other trade shows, including Surf Expo and ASD/AMD."We're low man on the totem pole, but I plan to break even and gain new customers," he said, estimating the company holds 550 accounts worldwide. "Sales increased 40 percent in 2005 and are showing similar numbers this year on a monthly basis."
Thompson said high profit margins in the sunglasses category coupled with only slight increases in labor and plastic costs in China have resulted in healthy sales. Wholesaling for $3, generic styles have evolved into more expensive brand-name collections. In 2005, the company test-marketed its Fantasy Sunglasses, or FS, collection at $4 per pair wholesale. Thompson said it performed so well the company introduced 30 FS styles for 2006 as well as the XS Fashion collection, and continued two other brands launched in 2005.
"We want to tap into the luxury market. Marketing gimmicks like ‘compare to' pricing are fading. Consumers want a brand name and not just something that looks like their favorite pair of Chloé or Gucci glasses," he said.
Established in 1999, Taolei Designs, a multiaccessories firm in New York, shifted from misses' to contemporary looks three years ago. The change affected sales immensely.
"We're floored by 200 to 300 percent sales increases annually since then," said sales associate Elizabeth Wang, who has watched the line's WWDMAGIC booth double in size. "Great designers and investors are allowing us to surpass our competition."
Taolei provides customers with celebrity-inspired and luxury trends at reasonable prices, according to Wang. Spring 2006 features handbags in novelty fabrics with quality hardware, jewelry in sterling silver or 18-karat gold-plated brass with quartz beads in 19 colors, and belts with sparkly buckles. The company plans to introduce silk scarves March. Items wholesale from $2.50 to $22.
Judging from the New York accessories show in January, Wang expects to add approximately 350 new accounts at WWDMAGIC to bring the company's total to some 4,000 doors worldwide. "Even though manufacturing costs in China were a little higher last year, we still managed to keep our prices down," she said.
San Diego Hat Co., a men's, women's and children's headwear and coordinating handbag company in Carlsbad, Calif., also is focusing more on a contemporary audience. Within the last two years, collections have become "more wearable and trendier," according to national sales manager Iwa Hooe."Business is fantastic. Hats are trending in general, and we're building a larger customer base through other niches like golf attire," she said. Hot styles include visors, urban safari-inspired cadets, packable "crushers" in grosgrain ribbon and cotton crochets with small to wide brims for $10 to $12 wholesale.
Hooe said the firm moved into more luxurious endeavors with the launch of a Panama hat group for spring 2006. Wholesaling for $28 to $65, pieces are handwoven in Ecuador using Old World techniques that were in danger of dying before the company brought business to the region. At $28 to $30 wholesale, rattan handbags with leather trim in a half-moon shape, elongated baguettes and weekend totes complement the hats.
"We're really trying to attract bridge and luxury customers," she said, adding that the company is already planning to add hats in Mod themes and real fur for fall 2006.
Hooe said the December 2004 tsunami created shipping and sourcing woes in 2005, but only a particularly wet rainy season in Madagascar that destroyed rattan crops affected costs this year. She noticed an increase in competitors' prices as a result. But a strong U.S. economy and punctual deadlines in China have counteracted bumps to bring an 8 percent sales increase in January 2006. "The hat business doesn't usually kick off until March or April, so it's a nice surprise," she said.
Hooe described WWDMAGIC as one of her most important international trade shows due to its central location and international buyers who book well in advance. She is also pleased that accessories' upswing has earned the category a separate location in the Hilton, where retailers can really concentrate. "We see more traffic every year," she said.
Steven MacPhail, vice president of sales for Landes Canada, a vertically integrated belt manufacturer in Quebec, reported that WWDMAGIC generates the highest trade show sales for the company. "It's head and shoulders above the rest," he said, adding that the company is projecting to add 75 to 100 new accounts between WWDMAGIC and East Coast shows.
More interest in belts as fashion, premium denim and better product are fueling sales, according to MacPhail, who estimated that Landes Canada's sales will increase 25 percent in 2006. He noticed a surge beginning last spring, especially with the influx of new buyers who weren't carrying the category before the trend.Reaching multiple price levels, the company produces BeltShak, its most financially successful collection of denim-friendly junior styles, wholesaling from $12 to $28; Landes Commercial, a contemporary collection driven by color, hardware and textured leathers, for $12 to $25 wholesale, and Landes Signature, a pricier collection ordered by high-end stores like Neiman Marcus and Stanley Korshak in Dallas, for $45 to $95 wholesale.
Leaders in Leather, a multiaccessories company in Austin, Tex., woos its accounts with strong branding and soft skins, according to sales manager Christine Mikulencak. "It's all about luxury. People want rich, supple leather that gives products that wow factor," she said of designer Ricardo Zuniga's use of napa leather this season.
Slouchy hobos and larger bags wholesale from $85 to $160, while belts with tooling and contrast whipstitching average $15.
In addition to 4,000 U.S. accounts, including Parisian and Spiegel, Mikulencak plans to open approximately 20 new accounts at WWDMAGIC. With its diverse crowd and Las Vegas setting, the show is pivotal, she said. "We did so well the last MAGIC that I'm very pumped for this round," she said.
Accounting for 25 percent of annual orders, WWDMAGIC is Miami-based handbag firm Murval's top show, according to president Bruno Zerdoun. Despite the company's success, he hopes WWDMAGIC organizers will base exhibitor layout on price and quality in the future.
"Buyers may not be attracted to walk down an aisle if there are less expensive or knockoff vendors next to established brands," said Zerdoun.
To deter knockoffs, Murval patents designs in Europe, which, unlike the U.S., allows for such patents, displays new merchandise on its Web site close to WWDMAGIC dates and develops and quickly changes themes that aren't trendy or long-lived enough to encourage mass production, said Zerdoun. Overhauling collections twice per year and keeping retail prices below $50 has garnered Murval 8,000 U.S. doors since its inception in 2001.
"The handbag market is fairly saturated now, but good design will ensure who stays and who goes," he said.
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