NEW YORK — The licensing machine continues to churn out deals and dollars.
According to The Licensing Letter, a monthly newsletter covering the entire field, estimated retail sales of licensed products in the U.S. and Canada climbed to $66.6 billion in 1993, up 7.1 percent from 1992. Apparel produced under license contributed $11.6 billion, and accessories $6.2 billion.
Some apparel brands have been staking their fortunes strictly on licensing. Here, profiles of four well-known names that have made it big — or plan to do so — through licensing.
THE BONJOUR GROUP
“We signed our first license about 18 years ago,” said Charles Dayan, chief executive officer and chairman of The Bonjour Group. “The company was three years old, and we felt that the name was getting a lot of exposure, but we couldn’t fill the demand.”
Bonjour was a department store brand until about eight years ago, when Dayan moved it to the mass distribution level.
“I felt [mass market retailing] was the future of America,” he said.
The company stopped doing any of its own manufacturing in 1991. Through its network of licenses, the brand now does about $400 million in annual wholesale volume, Dayan said, and plans to hit $500 million next year. It has licensees in categories from girls’ bodywear to outerwear for men and women.
Its current list of 36 licensees includes: Elk Brand Manufacturing, for men’s, women’s, children’s and large-size jeans and men’s woven casual pants; Franshaw for junior, misses’ and large-size knit tops and bottoms; D&R Sales Group for domestically made junior, misses’ and large-size woven separates, and footwear by Elan-Polo Inc. for men, women and children.
The most recent deal was a license for a line of junior, children’s and unisex costume jewelry with FAF Inc. While Dayan said that the company isn’t necessarily always “looking” for new deals, he noted that “there’s always something in the cooker.”
This year, creative director Ross Klein introduced a series of new ads for Bonjour shot by Francesco Scavullo. The ads, which will run in consumer magazines this fall, depict a blond bombshell model in various Bonjour outfits, with the tag line: “Cool. Smart. Sexy.” Klein said the company will spend about $8 million on advertising this year, including outdoor ads in various cities.
SASSON LICENSING CORP.
Sasson Licensing Corp. has been in existence since July 1988, when Trust Company of the West, an institutional investment firm, and Stephen Wayne and Associates bought the name out of bankruptcy.
With Stephen Wayne as the exclusive licensing agent and Linda Elton at the helm as president, the firm — whose brand name racked up wholesale volume of $358 million last year — markets 45 licensed categories through 35 licensees. It is anticipating a volume increase this year of between 10 and 15 percent over last year.
According to Elton, the company decided to become a licensing firm because it was a way to get Sasson merchandise out into the market soon after the trademark was acquired.
“Rather than spend money and energy trying to set up as manufacturers, which would have taken a year before product was out in the market,” said Elton, “we decided to spend our energy finding experts in each field. Consequently, the company shipped a $1 million program in August 1988, one month after the name was acquired.”
Sasson’s core merchandise base is jeanswear for the mass market, and accounts include Kmart, Ames, Bradlees and Venture stores. The biggest licensee is Sun Apparel, which produces men’s, women’s, and children’s jeanswear under the Sasson label. Sun also produces casual pants. Other major licensees include Indo-American Design Workshop, which produces women’s woven shirts and coordinates and large-size denim-related sportswear; Accessory Associates, for small leather goods; Accessory Network, for women’s belts, hats, scarves, gloves and related knit products; D&L Timewear, for watches, and E.S. Original, for footwear.
“What’s important to us as a corporation, when we’re looking for licensing partners, is for a company to be financially sound,” said Elton, who’s been with the company for about four years. “We also look for companies that have relationships with the retail base we sell, as well as with some upstairs accounts.”
Elton described the company as a marketing-driven one that provides a full support system for its licensees, including fashion trend direction reports, entry to retail management, advertising, merchandising advice and packaging programs.
“We give them all the tools to be successful,” said Elton, “but when it doesn’t work it’s been because a company doesn’t properly produce a line that reflects what we want the label to represent. They can’t just take the name and slap it on their existing line.”
Sasson’s plans for third- and fourth-quarter advertising will mark a return to what Elton said were the firm’s “music and sports” roots. This includes promoting the brand through concerts and sporting events, such as tying in with the Jones Beach concert series on Long Island this summer and advertising at stadiums. Sasson will spend about $8 million on advertising this year, and will also launch an in-store fixturing program in a number of key accounts.
Back in 1989, executives at J.G. Hook realized that the firm’s licensing programs were so successful, it might be worthwhile to license out all of its merchandise. The firm now has 46 licensees that manufacture about 75 different J.G. Hook products.
“We had been licensing on a small scale since 1982,” said Gary A. Kane, president and chief executive officer. “It picked up little by little and by the time we got to 1989 or so, it was working out very well for us.”
At that point, the firm was making only dresses and sportswear itself. Kane said dresses and suits were licensed to The He-Ro Group in 1989. However, when He-Ro divested many of its licensing agreements last year due to financial problems, J.G. Hook licensed dresses to Et-Al, and suits to Norash. Sportswear was licensed out in 1990 to Sultra Corp. As of spring 1995, though, Donnkenny will manufacture J.G. Hook sportswear, and Sultra will manufacture the less expensive Hook Sport line. While Kane would not disclose volume, he stated last year that sales for the brand were running slightly above $175 million.
“Companies really understand the concept of J.G. Hook without us having to give them myriads of information,” said Kane. “It’s easy to work with different people and to keep the merchandise looking the way it’s supposed to when the concept is about understandable, moderate, classic things.” Kane said that compatibility is “absolutely number one,” when deciding on licensees. “Especially when you’re dealing with this many licensees, your thought processes need to be the same,” he said.
The Generra Co., based in Seattle, has been in existence 15 years, building its reputation as a vendor of young men’s and junior sportswear. It has been only a licensing company for the past 14 months.
That decision followed a spate of financial problems that landed the firm in Chapter 11 in July 1992. It emerged from those proceedings in October 1993, and now under the direction of president Alan A. Bobin, who joined the company in March, it is trying to cut a new path as a name in the junior and misses’ apparel areas as well in men’s.
“We’ve been primarily known as a men’s resource,” said Bobin. “We have been in women’s in a small way, such as with socks, but of course the women’s business is much bigger.”
The first area that Generra went for in women’s was the junior apparel business, which Bobin said was an easy jump-off because “it moves quickly, and denim is hot right now.” Generra signed a licensing deal with the San Francisco-based B&B Associates, for a line of knit shirts, appliqued sweatshirts and brushed twill pants as well as denim jeans, shorts and shirts. The line will retail from about $12 to about $34. It is targeted to department and specialty stores, a point Bobin wants to emphasize.
“Our mission is to relaunch the Generra name, known in the young men’s sportswear market, with a broader scope of products,” said Bobin. “We are broadening the moderate market, in the form of department stores and specialty stores. We are not in the marts or the discounters.”
The line will hit the stores in late June for back-to-school sales this year. Other licensees for women’s apparel and accessories are in the works, Bobin said, with a complete Generra women’s line expected for next fall selling.
Bobin said close work with retailers is an important part of the company’s new strategy.
“We will sit down with our licensees and a department store group,” said Bobin. “We will work with each division to sell our product.”
While he declined to give any specific figures about the brand’s current wholesale volume, Bobin said his “minimal goal” for gross sales for Generra is $100 million by 1997, and he described that as “dramatic growth.”