DALLAS — “Diversification” is the mantra at Jerell Inc. as the 30-year-old manufacturer of moderately priced sportswear and dresses expands its product line and cultivates new markets.

For spring, the company is introducing two labels, expanding two existing lines and trying to sell to catalogs and build its private label program.

“Businesses reach a natural saturation point, so in order to show growth, you need to find new markets,” reasoned Ed Vierling, president. He projected 1994 revenues at $59 million. Last year the volume was $54 million.

A key aspect of Jerell’s strategy is to create different labels for department and specialty stores, as it does with its mainstay Melissa dress collection.

“The specialty stores like variety; they won’t necessarily buy the same look that did well last season,” theorized Sam Klapholz, vice president and national sales manager. “The major stores want statements in whatever is popular at the moment — now it’s pantsuits — or they will take an item and want it done 10 different ways.”

Besides Melissa dresses, the firm’s cornerstone collections are Ali Miles sportswear and Stephanie Thomas large-size dresses and sportswear.

Building from that base, for spring Jerell is introducing Signature by Ali Miles, a traditionally styled sportswear collection that switches direction from the house’s longtime emphasis on novelty looks.

Signature’s debut spring collection provides, at $14 to $29 wholesale, staple fashions like camp shirts, knit T-shirts, full and straight skirts, walking shorts, pleated pants and long vests. Everything is in chintz prints, small geometric prints, solids and washed denim in cotton, cotton and linen or rayon.

“It’s for customers who want practical, preppy clothing that they can wash and who don’t want to jump on a trend,” Klapholz said. “You can wear a long khaki skirt for five years and then throw it out and buy a new one.”

First-year Signature sales are projected at $2 million to $2.5 million. “We’re beginning with specialty stores, and if it grows, the next step is to expand it into a major-store business,” Vierling noted.

The original, novelty-oriented Ali Miles sportswear in regular and petite sizes also is targeted at specialty stores.

The firm is expanding its sportswear offerings styled for older women under the Victoria Morgan label, which was launched four years ago as a dress line with social and daytime looks. Last fall, when an experimental velour sportswear group booked a hefty $600,000 in orders, Jerell decided to launch a full Victoria Sport Line.

For spring, Victoria Morgan Sport offers three groups: blue cotton chambray, sanded polyester in brights and a red and white polyester and cotton interlock knit. Catering to women aged 40 and up, the line features casual tops with sleeves that cover the upper arm, and bottoms with elastic waists.

In its first year, Victoria Morgan Sport is expected to do $2.5 million — 25 percent more than the dress collection. Intended for specialty stores, it’s priced from $14 to $34.50.

In an offshoot from Stephanie Thomas, a large-size sportswear and dress line that does $9 million in sales to specialty stores, Jerell is developing a second special-size dress label intended for department stores.

Jess & Liz dresses are offered in petite and large sizes. The line mixes classic jacket-and-pants combinations or two-piece tunic dresses with a handful of updated silhouettes, like a spaghetti-strap Empire-waist dress over a T-shirt.

Jess & Liz wholesales for $34 to $44 and is expected to do $2 million its first year. Since it’s designed for big chain stores, it will be shown only in the firm’s New York office.

The firm is also diversifying the styling of its Samantha Edwards junior dress line, adding contemporary looks with ditzy prints and short hemlines to its existing frilly, Southern styles. That line ranges in price from $32 to $49 and is sold to specialty stores.

Jerell sees opportunity in private label and expects its business to triple this year to $3 million. The firm has done work for a variety of department stores, discounters and catalog houses.

“It encompasses all areas of the company — dresses, sportswear, tall sizes, maternity,” Vierling pointed out. “It’s price-driven.”