JUNIORS GET THE JITTERS
Byline: Melanie Kletter
NEW YORK — With department stores in a bit of a slump and consumer confidence showing some slippage, junior companies are feeling some caution heading into fall and holiday.
Fall bookings were down for some vendors, and overall, the second half looks to be more challenging than last year, industry executives said.
Some big brands have already taken hits. Tommy Hilfiger earlier this year folded its junior business into its jeans area, reflecting weakness in that division, and many firms said department stores are cutting back on their investments in a variety of arenas, including juniors. A number of junior vendors said reorders are down, and that they are projecting slower increases than last year based on recent orders, as retailers keep a tight rein on inventory levels.
Smaller firms are especially at risk as mammoth department-store operators look to build closer relationships with a smaller number of vendors — mostly the big names — observers said. Many companies said they were looking to increase their distribution in specialty stores and boutiques to cushion the blows from sagging department-store sales.
“We are proceeding with caution and making adjustments to our business where we have to,” said Richard Clareman, president of Self Esteem, based in Los Angeles, reflecting the sentiments of many vendors. “The way I see it, you have to be lean and mean, or you will be dead.”
“The junior business overall is tough, as is the whole retail environment right now,” said Kevin Monogue, vice president of sales at DKNY Jeans Juniors. “Companies have to stay focused and true to their mission.”
Lorna Brody, vice president at the streetwear firm UFO, said: “This year, it is a matter of having the right product at the right price. Teens have more options than ever to spend their money on, and everyone is fighting for that same share of expendable income.”
Nonetheless, teens — as fickle as they are — still love to shop, and for those companies that have the right formula, there’s still lots of business to be had.
A number of companies are generating business by delving into the tween arena. Retailers are expanding their space for girls and tweens apparel, and many junior vendors, including Guess, One Clothing and Self Esteem, have developed smaller sizes in their existing lines to tap into this fast-growing segment.
In addition, licensing, another route to drive extra sales, is picking up in the junior segment. Dollhouse has just added a few new categories, including dresses and hosiery, and XOXO has expanded its accessory offerings with the introduction of belts and also plans to launch shoes. Rampage and Guess have also added new licensed categories recently.
On the fashion front, vendors have introduced a range of items to generate excitement in the second half. Highlights include:
Prints such as stripes and geometric shapes.
Gold and metallic motifs, ranging from gold-foil treatments and glitter embellishments to gold-colored merchandise.
Rhinestone and stud treatments.
Denim, especially styles using special treatments.
Seventies-inspired merchandise and logo T-shirts.
Key silhouettes include sheer blouses, hooded sweatshirts and low-waist pants and luxury-oriented fabrics such as leather, suede and velvet.
DKNY Jeans Juniors, the new junior line from Donna Karan that is produced by Liz Claiborne Inc., has gotten off to a strong start and will be expanded to 700 doors this fall, up from 300 when it launched at retail in February, according to Monogue.
Bookings were on plan for fall, and so far, the division has met the internal plans of the company, he noted.
Much of the company’s growth so far is coming from expansion at department stores, and DKNY is also looking to build its distribution in specialty chains and boutiques.
In fashion, a big push at DKNY this fall is denim, with a variety of treatments, such as leather lace-up closures and whip-stitch details, being important elements. Suede and leather are also key categories, while the holiday period will feature more knitwear and a variety of logo T-shirts. Tartan plaid and stretch mesh also booked well for fall, Monogue noted.
XOXO is graduating to a more sophisticated look, according to Aaron Smith, director of marketing. The company has been gradually raising its average price point at retail, which is now at about $48. XOXO has also upped its products to size 15 to accommodate women, as well as large-size juniors.
“We have moved away from clubby sorts of looks to offer more sophisticated styles,” Smith said.
Within the sportswear collection, key looks for fall include halter dresses, fake fur, lined outerwear and career separates, as well as gold and denim.
The firm is also busy opening new stores, including freestanding units in Santa Monica, Calif., and London, both slated to bow for January 2001; an Internet site featuring e-commerce capabilities is scheduled to go live at the end of this month. XOXO now has four stores. While the bulk of the brand’s distribution is in department stores, the company is also exploring moving more into the boutique arena, according to Smith.
One Clothing is focused on building up its new B heart B Bugle Boy label, as well as its branded One Clothing label, said Ace Ross, president. The Bugle Boy label, which is set to launch at retail in the fall, will bring the company into new distribution channels in mid-tier department stores. The company now sells primarily to boutiques and specialty chains.
Top fashion trends at the One Clothing division include loose knits, suede trims and fur treatments, as well as plaids, checks and printed bottoms. The B heart B label features more defined silhouettes and fabrics such as stretch denim and baby-rib knits. Subtle details in the line include crochet lace trims and ribbons.
The firm has gotten more aggressive in the tween area with the fall introduction of its One Teenie line, and it also is launching B heart B girls in conjunction with the launch of its B heart B label. With the new introductions, sales are expected to be up about 30 percent this year, Ross said.
At Dollhouse, leather and suede received attention during the recent market, said Albert Shehebar, president.
“It’s a higher-priced ticket, but so far we have gotten a great response,” he said. The company’s bookings are ahead of last year so far, and Shehebar said the firm is on track to record sales gains of about 30 percent, fueled by the introduction of new categories and growth in existing channels of distribution. Half of the firm’s distribution is in specialty stores, and half is in department stores, according to Shehebar.
Following a massive management shift, Esprit de Corps is currently in the midst of “refocusing on what the strength of the brand is,” said Maria Comfort, the firm’s new senior vice president of sales for women’s and girls’ apparel.
Esprit has been rebuilding its top management ranks in recent months and focusing on its core wholesale business. The company is still in a transition mode, and significant changes will be seen in spring 2001 in terms of overall strategy and merchandise, she said.
While best known for its bright colors and upbeat styles, Esprit is currently focusing on bottoms, which have been strong, as well as stretch fabrics, and Comfort noted that the firm “has had tremendous success with career separates.”
Younique Clothing, a growing junior company, is focusing on gold motifs, foil-coated sheer pants and coated moleskin pants for fall. Tops include wrap shirts, sweaters with poodle collars, sheer blouses and sleeveless looks, said Peter Kossoy, president. Geometric motifs, including stripes and block patterns, are key looks, and velvet is an important fabric.
“The fourth quarter is going to be very item-driven,” Kossoy said. “Glitzy and shiny items look to be tremendous.”
Younique’s volume for the year likely will be up about 10 percent to $75 million, according to Kossoy.
UFO, the hip streetwear firm, is continuing to focus on its popular polyester and cotton baggy parachute pants, which have seen strong sales in the last few years, especially among followers of the rave and club scene. For fall, UFO, which is primarily bottoms-driven, is offering new twists on its parachute theme with updated pocket treatments and new camouflage prints that appeal to both men and women.
UFO does not advertise and has cultivated cool in the streetwear scene by staying underground.
“One advantage we have is that we are not publicly traded, we can turn faster than other people and we don’t have to discuss design plans with many people,” said Lorna Brody, vice president of UFO. “A lot of our customers are having a backlash of the merchandise going into department stores and against the advertisements that are always in their face. It is not necessary for us to be megabrand.”
At Self-Esteem, a four-year-old firm, sales for the second half are projected somewhat lower than the first half in light of recent trends, said Richard Clareman, president. Overall sales are projected to reach $32 million from $50 million last year, aided by increases in its new kids’ business.
Clareman said his best booked items for fall were hooded tops, some featuring zippers, others with fleece. Rhinestone and studs and logo Ts are also popular items.
“We are aggressively going after casual apparel,” Clareman said. “We are not really addressing clubby and dressy looks.”
Clareman said his firm is working more with teen focus groups to better discern what younger customers are looking for.
To The Max, the junior business of contemporary firm BCBG, is focusing on building its distribution in specialty stores. The three-year-old line is now in about 70 doors, primarily in the department-store channel.
“Currently, we are adding a shoe line, launching in the later part of 2000, and a denim line for 2001,” said Serge Azria, president and design director of Parallel and To The Max.
Key merchandise trends for fall and back-to-school include halter tops, geometric prints, gold everything, Seventies-inspired merchandise, denim treatments, rhinestones and glitter.
Liz Claiborne will roll out its new licensed DKNY Jeans Junior brand to about 400 new doors, bringing its total distribution to 700 doors.
One Clothing will launch its new B heart B line of Bugle Boy clothes for juniors at department stores this fall.
Junior powerhouse Dollhouse will debut leather and suede for the first time.
XOXO will launch its Web site, featuring e-commerce, at xoxo.com, at the end of this month.