LOS ANGELES — Clio, a fixture in the moderate misses’ category, is transforming itself into a retailer of young contemporary fashions, abandoning the wholesale business to tap into a growing market that is more likely to spend.
LF Stores, a division of Clio owner LF Sportswear, bowed this month on Main Street in Santa Monica. In the next two months, stores will open on Robertson Boulevard in Los Angeles, in La Jolla, north of San Diego, and in Manhattan’s SoHo neighborhood, as well as the New York suburb of Scarsdale and the resort of Southampton on Long Island. The units will be on street fronts rather than in malls, which “aren’t inspirational,” owner Laurie First said. Another 10 stores are in the pipeline for the next year. The locations have not been disclosed. The Clio brand will cease production.
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“Moderate vendors are selling out or liquidating or collapsing before our eyes,’’ said apparel consultant Emanuel Weintraub. “It’s become tougher to handle the problems of a retailer.’’
Clio started out with a georgette blouse in one style and one color, and grew into a $100 million powerhouse of washable rayon and silk separates and leather and suede designs. Macy’s West, J.C. Penney and Robinsons-May were among the department stores that carried the line. More than a year ago, First pulled out of May Department Stores Inc. and sold his line exclusively at J.C. Penney. Clio stopped shipping to Penney at the end of January.
The moderate vendor is a shrinking breed as 35 percent of all apparel purchased in the United States is produced by retailers, driving a stake into the hearts and balance sheets of their vendors, such as Clio.
“I should have done this 10 years ago,” First said. “The business used to be about fashion, not price. It wasn’t fun anymore.”
First developed his retail plan about 18 months ago, seeking to target that Fred Segal-minded customer aged 20 to 35. His retail strategy is to lure the customer into the store for merchandise not found elsewhere — a feat, considering contemporary designers often saturate the boutique marketplace. Along with in-house brands L. First, Emma & Sam and Car-Mar, featuring flippy miniskirts, tie-dyed shirts, tattered denim miniskirts with studs, embroidered denim jeans with pin buttons and dyed jackets, the store carries product from indie European designers picked up by First and his wife, Marsha, on their frequent visits to Europe.
First admits securing such premium real estate wasn’t easy.
“Initially, it was difficult, since we were newcomers to retail, but once brokers understood the concept and saw our financial, they were coming to us,” he said.
Locations range from 1,100 to 2,200 square feet. For the Santa Monica location, First let the existing brick facade and loft space set the tone. The walls are bare and intact with shelves suspended from the ceiling. Antiques, such as a church pew and wine rack, serve as display cases for T-shirts. Prices retail from $46 for a supple, tie-dyed tank top to $65 for a polkadot clutch bag to $118 for a mini denim skirt with frayed hems to $130 for twill pants with split, tie-dyed legs, and up to $450 for a trenchcoat from Italy.
Walking away from a sizable business is a risk, but First has planned conservatively, projecting initial losses because of the store build-outs. He expects the long-term investment will pay off, with sales ranging from $600 to $700 per square foot.
To facilitate the transition, First trimmed his operation by about two dozen employees in the last year in the manufacturing, production and distribution departments. He bolstered his design team with graduates from local fashion schools who he said are innovative and attuned to customers’ needs.
“Over the years, he’s been successful in getting the right items at the right time to stores,’’ said Sandy Richman, principal at Los Angeles buying office Directives West. “I believe if he can be a good manufacturer, he can be good at retailing.’’