By  on February 24, 2017

It’s been a slow bleed for many — but can healing come after storewide discounts, sparse racks and parched inventories? Whether brands that find themselves at the financial brink and ultimately give in to bankruptcy or liquidation can come back is an increasingly pressing question in fashion.So far this month, Gildan Activewear Inc. bought the American Apparel brand out of bankruptcy and snatched Nasty Gal’s intellectual property from insolvency. Likewise, Hilco Streambank was hired to sell the Wet Seal name as the teen retailer wends its way through a second bankruptcy.“I honestly don’t feel that any of those brands will have a resurgence equal to what they were at their height,” said Houman Salem, chief executive officer and founder of Argyle Haus of Apparel Inc., a fashion design and manufacturing company that also has a brand-management division.Gildan is still working on manufacturing plans and a strategy for its recent acquisition, but the brand’s web site promises “American Apparel...coming back stronger than ever!” — showing off some of the optimism required to pay $103 million for a brand that’s been through the wringer with employee protests, lawsuits, vocal opposition from ousted founder Dov Charney, two bankruptcies and thousands of layoffs.The Nasty Gal business, which Sophia Amoruso started with an eBay store and turned into a spectacular exercise in Millennial branding, is still winding down, but seems a logical fit with Boohoo’s online fast-fashion stance. Digital ain’t easy, but it’s one path to potentially resurrect a dead brand.“There’s certainly a path to profitability via digital, but it’s not the end all,” Salem said. “It doesn’t always work and it’s getting tougher and tougher to stay competitive. One of the primary reasons for that is the strength of Amazon.”For some, it’s not so much a question of can these brands be revived, but should they be saved at all.Wet Seal changed its pricing structure about a decade ago to compete with Forever 21, but never found its groove. In recent years, the specialty chain saw too many chief executive officers rolling out too many strategies, confusing customers and spooking investors.To Kathy Bronstein, who served as the company’s ceo for 11 years, including a strong run in the Nineties, there’s little value left in the name.“How would the brand have any equity? Nobody knows what it stands for. It was just so unclear to me and I think to 95 percent of the customers, what exactly do you stand for: Saturday’s deal and Monday’s mood,” Bron- stein said, referring to promotions the chain used to woo shoppers. “I’m not saying Wet Seal is that dramatically different from any other brand. They’ve all been up and down trying to respond to a change in customer base and change in lifestyle.”Bronstein took Wet Seal from a Newport Beach, Calif., retailer with a handful of stores to a more than 600-door chain, leaving in 2003. (She sued for wrongful termination, gender discrimination, emotional distress and other charges and ultimately settled with the company. She then returned in 2012 at the height of the retailer’s identity crisis to serve on the board, departing again in 2014).Bronstein is watching the market, seeing the end of a cycle. It’s the same shift that comes every few decades or so and the same shedding that at one time made room for Wet Seal.What’s different now is the customer.“For the last five, six, seven years, the customer has been changing and not giving any of these retailers a consistent answer,” Bronstein said. “That ultimately was the demise of all of these retailers. They didn’t understand what [the customer] was saying and what she wanted and that’s not a criticism; it’s just a reality.”

To continue reading this article...

To Read the Full Article

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus