BEVERLY HILLS — The fashion face-off between jeans and dresses couldn't be defined better than the meeting between Christina Lewis and Maureen Cheong.

At a recent cocktail party here, the statuesque Lewis donned dark skinny jeans by 575 Denim with a low-cut black top, while Cheong wrapped a scarlet ruffled dress by Rami Kashou around her petite frame.

"It's a very L.A. thing," said Lewis, 25, of wearing jeans out on the town.

The design consultant and illustrator said earlier that day she purchased $400 high-waisted jeans by Grey Ant to add to her collection of 20 to 25 pairs of jeans.

"I can go to work in denim," Lewis said. "It's part of the dress code, if you may."

Cheong's wardrobe, on the other hand, revolves around the dress, which she said is "flirtier, sexier and even sometimes more comfortable than denim." The 30-year-old fashion blogger said she has bought triple the number of dresses than jeans in the past year.

Dresses seem to be getting more attention these days, many times at the expense of jeans as an everyday style of choice.

Market research firm The NPD Group said in the 12-month period through March, sales of men's and women's jeans at department stores and national chain stores fell 1.2 percent to $3.57 billion. While sales in jeans priced less than $74.99 declined, the premium category, which encompasses jeans priced at $100 and higher, grew at a slower pace than in the previous year. Sales of premium denim rose 23.7 percent to $314 million through March, compared with an increase of 47.5 percent to $253.9 million a year earlier.

What this means is that the premium denim industry is undergoing a major shift. Retailers are forced to reassess their merchandising strategy, seeking resources such as collection-focused contemporary vendors. Denim designers are compelled to turn to alternative fabrics such as linen and twill and initiate buzz-worthy marketing collaborations. Contract manufacturers are drawing the line at helping every Johnny-come-lately to focus on marquee clients with solid track records at retail.

It all leads to the question: Does Los Angeles still reign as the capital of premium denim?"It's taken a 180-degree turn," said Fred Levine, owner of the eight-door specialty chain M. Fredric, based in Agoura Hills, Calif., of the premium denim market.

Levine has cut in half the number of denim lines he carries for men and women to 15. Of those lines, three — True Religion, Joe's Jeans and 1921 — make up about 85 percent of his inventory. Denim makers have shaved their prices by $10 to $20 at wholesale, which translates to a $50 decrease at retail. Consumers want to spend $180 to $220, at most, on premium denim, he said.

Retailer Hillary Rush said denim constitutes 25 to 30 percent of overall sales, down from 60 percent in April 2005 when she opened the doors of her eponymous specialty shop in Los Angeles. Denim brands that fare well are ones like Anlo, which offered novelty pieces such as a Sixties-inspired denim jumper.

"It sold out in a day and a half," Rush said.

Suzy Radcliffe, founder and creative director of London's Radcliffe, has a simple explanation for the changes in the denim industry.

"It moved from a basic market to a fashion market," she said. "Once the market is transformed into a fashion market, you don't have so much of a flexibility to carry stock. You have to absolutely be on trend. You need to forecast out to be on trend. It's hard for the denim market."

Paul Guez, a 30-year veteran of the denim industry and chief executive officer of Blue Holdings Inc., a Commerce, Calif.-based company that produces and sells jeans, sportswear and accessories through brands including Antik Denim, Yanuk and Taverniti So, said, "The L.A. market is still number one, but it's not alone."

Guez said he is trying to adapt to an evolving market. One solution is to collaborate with The Black Eyed Peas' Will.i.am on a brand called i.am Antik that will launch next spring with men's and women's jeans retailing for about $180.

"We're working very hard to maintain our position and try to grow," Guez said.

Denim makers are also facing stiffer competition from sportswear companies. Laurie Hasson, who owns a showroom bearing her name, said denim-centric retailers are clamoring for dresses from contemporary brands such as Rachel Pally and Twinkle by Wenlan that can be mixed with their stock of jeans."They want it to come back to fashion, design and real craftsmanship," she said, noting that she never bothered to carry a denim line in her showroom.

Showroom owners who do offer denim said it's no longer a breeze selling it.

"You have to work harder than you used to to sell a jean," said Karen Erickson, co-owner of Showroom 7, which has offices in New York and Los Angeles and represents Kova & T and Denim for Immortality in the premium jeans category.

Los Angeles' DBLA Clothing dropped denim altogether for its spring collection. Instead, it proffered jackets, woven shirts, knit tops, sweaters and dresses in twill, herringbone, jacquard and jersey.

"We found that by offering that nondenim collection, we were in much more demand," said design director Alexis Frey.

Nevertheless, newcomers still storm the denim market with zeal and optimism. Within the coming year, shoppers will be able to find dungarees emblazoned with names such as Eclipse Noir and Desert Blue Premium in stores.

"We're not thinking if the market is down or if there is a lot of competition," said Zen Warne, Desert Blue Premium's sales and marketing director, who aims to hit $1 million in first-year sales.

To hedge her bets, Warne said the company also plans to diversify its inaugural summer collection with dresses, T-shirts, vests and trousers.

Aside from landing a showroom and retailers, a start-up also needs to rely on manufacturers like Kris Park, vice president of New Crew Production Corp. in Los Angeles. Employing 230 workers to make jeans for labels including True Religion, Siwy, Rich & Skinny and Lucky Brand Jeans, Park said she's been turning down new clients to focus on her current roster that brings her company $10 million in annual revenue.

She made an exception for Bogdenoff because she thought the Los Angeles label had an interesting concept with its multipaneled jeans. Still, nothing compared with 2005, when business increased 50 percent from the previous year and 12 to 15 new labels inquired about using her services. In 2006, half-a-dozen came to her — and she turned them all down — and this year fewer than four have visited her."A lot of new companies came up in late 2004 [and] 2005," she said.

Georges Atlan, chairman of Pride Jeans in Vernon, Calif., said the denim market was hurt by the onslaught of labels that jumped on the denim bandwagon without really understanding the business.

"So the stores didn't pay attention to the names, you know, just to the styles," he said.

Atlan produces two proprietary brands, Iron Army and Dwell, in addition to products for companies including Frankie B. and Rock & Republic. The good news, he said, is that the inexperienced companies have left the field.

"I still believe Los Angeles is the capital of denim," Atlan said.

One of the major hubs of jeans sales in Southern California is Fred Segal Fun in Santa Monica. On a given week, the specialty retailer sells anywhere from 140 to 180 units out of some 35 denim brands. To be sure everything sells, assistant denim buyer Kaci Wilson said she has to offer a variety of silhouettes and fabrics, ranging from overalls, skinny legs, boot-cuts and shorts to twill pants from Hudson Jeans and Robin's Jean and linen bottoms from Level99.

"A new line at this point either has to be an amazing fit or completely different," said Wilson. "People stick to the old favorites — Chip & Pepper, Sevens, Paige — if they are going to buy basics. Newer lines have a tough time competing with that."

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