DENIM DISH

Byline: Scott Malone / Julee Greenberg / With contributions from Melanie Kletter

Lee Makes a Wish
Lee has one big wish: to get a bigger chunk of the junior jeans business. It also has a problem: Many teen girls think of Lee as a boys’ brand.
Enter Wish, a new line the company is launching for back-to-school retailing.
“After doing some market research, we found that many people think of Lee as a male brand,” said Nancy McDonald, manager of marketing communications. “What the young girl wanted was her own brand.”
The fall line takes its inspiration from the Seventies, with vintage washes, low rises and retro details dominating. Some of the denim is subtly tinted with pink, green or blue accents. Other fabrics feature overdyed treatments and textured cross-hatch surfaces. Each style is named after some aspect of the galaxy. For example, Orion’s Belt is a hipster style with a built-in belt, while the Eclipse is made in a two-toned denim.
McDonald described the Wish customer as a 14-to-18-year-old girl who is looking for a fashion-forward brand on a babysitter’s budget. The jeans retail between $32 and $40. She said she expects the brand to have the same distribution as the Lee jeans brand, but plans to sell some specialty stores as well. In total, the brand aims to be distributed to about 400 doors. It may expand into other sportswear items.
“Some pieces in the line are trendy, so it will fit well with department and specialty stores,” she said.
This is Lee’s second recent attempt to expand its junior business with a non-Lee brand. It launched a fashion-forward line called Diva Doll for holiday 2000 retailing. That collection failed when the company could not ship product fast enough to meet the needs of junior retailers. McDonald said parent company VF Jeanswear Ltd. set up a plant in Mexico that is entirely devoted to the production of Wish and will work on a separate timetable from facilities that produce Lee to solve that problem.
“We realized that we had a good product with Diva Doll, but there were some problems with the shipping. You have to be fast in this market,” she explained. “We have ironed out the problems and went back to the drawing board. Now we have Wish.”

There Will Be a Quiz
Call him Dean Klein. Ross Klein, senior vice president of corporate marketing at Sun Apparel, which produces Polo Jeans, wanted to make quite sure that retail salespeople had a chance to learn the finer points of all the whistles and bells — and washes and belts — the New York-based company puts into its jeans.
So on Friday the vendor is launching Polo Jeans Co. University, a secure Web site that will offer its brand coordinators, specialists and floor salespeople at the stores where the brand is sold a full curriculum on the line.
“We all create look books, but I don’t think of that as current,” he said. “Culturally, from an educational and motivational point of view, this is much more creative and innovative.”
The Web site offers six weekly installments of details on the brand’s spring lines, including its fashion deliveries and the variety of washes in the core program. After finishing the reading, the participant is asked to complete a brief multiple-choice quiz. A passing score means the test-taker can click onto the “Wheel of Prizes,” which doles out goodies such as CD’s, baseball caps and T-shirts to the program’s participants.
Polo Jeans is also using the prize lure to encourage retail employees to keep the firm up to speed on who is buying the jeans.
“To tell someone, ‘We’d like you to keep a client book,’ is one thing,” Klein said. “This way, every time they sit down to their terminal [to take the weekly quiz] they can do this.”
Every five customers the participant enters into Polo’s database leads to an entry to another prize drawing, for bigger-ticket items, including a home theater system and electronic organizers.
“It’s engaging and rewarding and there is also a certain amount of entertainment value,” Klein said.
Using the Web to inform store associates about the product line is also more practical than sending employees and handouts to the stores, he acknowledged.
“It’s always available,” he said. “It’s different than if the salesperson starts on Thursday and gets a look book on Friday and quits on Sunday. Then it’s gone….This is very efficient as far as the media itself goes.”

Jill Stuart Jeans Broadens
For fall, Jill Stuart Jeans is widening its product offering to include knit and woven tops, with the goal of doubling its revenue over the coming year.
Since introducing jeans, skirts and denim jackets for spring 2001 retailing, the line — which is produced by New York’s Alpha Group — has reached annual volume of $6 million, according to Charles Jebara, president of Jill Stuart Jeans and a member of the family that owns Alpha.
“If we added tops, we could about double our business by just adding that to our current customer base” of 500 doors in the U.S., he said.
The new tops, which are to be made in Hong Kong and China, will wholesale from $25 for knit T-shirts to $60 for silk blouses. The assortment will include basic casual tops, as well as dressier feminine styles, all to complement the main jeans line, reflecting what Jebara called the brand’s “diverse customer base.”

Guess Hires Melancon
Continuing his efforts to shore up financial oversight at Guess Inc. following the discovery in late 2000 of accounting errors that forced the company to restate its earnings for most of that year, president and chief operating officer Carlos Alberini on Wednesday said he has hired former Sony executive Paul Melancon as vice president and corporate controller.
This follows the November naming of Fred Silny as chief financial officer and the company’s fall 2000 recruitment of Alberini himself, a former retail chief financial officer.
Melancon last served as senior vice president and chief financial officer of Hyper Entertainment Inc., a subsidiary of Sony Corp.

Isaacs Loss Narrows
I.C. Isaacs & Co. Inc. lessened the flow of red ink in both the fourth quarter and the year despite substantial losses from discontinued operations.
For the three months ended Dec. 31, the Baltimore-based jeans and sportswear maker reported a net loss of $4.7 million, or 60 cents a diluted share, as compared with a loss of $14 million, or $1.77 a share, for the year-ago period. Losses for continuing operations fell to $2.5 million, or 32 cents, from $13.7 million, or $1.75. Sales slipped 11.3 percent to $15.1 million from $17 million last year. The year-ago quarter and year included an $8.1 million expense for the termination of the firm’s licensing agreement with Boss.
Discontinued operations principally involved the European subsidiary sold in February as part of its plan to streamline operations and focus on higher margin products sold under its license for the Marithe and Francois Girbaud brand.
“Although we expect to continue facing a challenging economic environment in the first half of 2002, we are encouraged that I.C. Isaacs is now a more efficient and more focused operation,” said chief executive officer Robert Arnot in a statement. “Our top line in the fourth quarter and year 2001 reflects the continued challenges in the retail environment. At the same time, our bottom line benefited from aggressive efforts to streamline our organization and reduce expenses.”
Overall, in fiscal 2001, I.C. Isaacs reported a net loss of $4.7 million, or 60 cents a diluted share, identical to its quarterly loss, as compared with last year’s loss of $15.2 million, or $2. Excluding the effect of the discontinued operation, the company would have reported a smaller loss of $2.2 million, or 28 cents. Sales for the year slumped 14.1 percent to $82.3 million from $95.9 million in fiscal 2000.

Levi’s Accessorizes
Levi Strauss & Co. is getting back into the accessories business.
The denim giant has entered into an agreement with Tandy Brands Accessories under which Tandy will produce ladies’ small leather goods and belts under the Levi’s name. The line will begin shipping in July in time for fall and back-to-school selling. Retail price points range from $14 to $20 for leather goods and $20 to $36 for belts, and products will be distributed at both department stores and specialty stores, said J.S.B. Jenkins, president and chief executive officer of Tandy. Tandy, which is publicly held, produces and distributes men’s and women’s fashion accessories under other licenses as well, including Jones New York and Dockers.
The products have a vintage feel and build on Levi’s brand heritage, a Levi’s spokesman said.
San Francisco-based Levi’s previously had a licensing arrangement for these products with Humphrey’s, a manufacturer of belts and wallets, which it discontinued after Humphrey’s was purchased by Randa Corp.

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