Running a multimillion dollar business that your mother founded and continues to be the driving force behind is no easy feat, as president of The Natori Company Ken Natori can attest.
But 10 years after he gave up a Wall Street job in institutional equity sales, the Stanford Business School graduate has no regrets about joining the company as president. While his mother tends to be in-the-moment, impulsive and eternally optimistic, Ken Natori is more cautious, realistic, planned and calculated. “We really are very much a yin and yang, which is good actually,” he said.
At 70, his mother could not be more passionate about everything she does, and some of that drive is genetic. “My mother’s father came from a very poor family in the Philippines and worked his way up to build a successful construction company. After he died, my grandmother now runs that company at 92 years old. That work ethic, passion and constant energy just got passed down to my mother. Whether it’s working here or practicing piano, she just put that passion into everything she does,” Ken Natori said. “My mother could not be more passionate about everything she does. It’s not easy work.”
Internationally distributed in 20 countries, the Natori label recently opened a pop-up in Harrods and is still mulling over whether to have overseas warehouses for further expansion. More immediate opportunities would be in launching shoes, handbags and swimwear, Natori said, as well as building up the more affordable N Natori and Josie labels, but the core of the business will remain the luxury label. With sales up slightly, the company prides itself on consistency, controlled distribution and steady growth.
Here, Ken Natori talks about expansion, challenges ahead — and why he might retire before his mother.
WWD: Why did you decide to join?
Ken Natori: I’m an only child and I never thought I would join the company. I never wanted to be somewhere that I felt I was just there because it was a family business. I was a TV and radio reporter for five years at Bloomberg and then went to business school. On Wall Street, I thought, “If I’m going to work this hard I want to at least affect the direction of a company.” It was also the first time that I felt I had developed a set of skills where I felt I had earned a seat at the table.
WWD: How did your mother react?
K.N.: I think she thought, “Oh great, now I don’t have to think about the succession thing,” which was a little bit of an overreach. She definitely welcomed it because we’re 100 percent family owned and finding people that you can fully trust with the business is hard to come by…She is the face of the company. More than anything, this is her baby and I want this company to provide her happiness. Her happiness is from being in an environment where she can design what she wants to design, make decisions and really be proud of every single thing we put out in the market.
WWD: What’s most challenging about business?
K.N.: There’s no loyalty to stores. There’s less loyalty to brands and increased expectations from customers who want to access product whenever they want to and however they want to. Our brand is still very strong. We’ve maintained very clean distribution and there is still great demand. Meeting that demand whether it’s through social media, our own web site, or all of these other online sites that have popped up — it’s just more complicated than it used to be. It’s more work, but it’s fine.
WWD: Where are the strengths?
K.N.: Department stores are still our strongest part with about 60 percent [of total sales]. They’ve evolved as well. For some, their own e-commerce is 50 percent of the business now. Has in-store traffic gone down and it will continue to go down? Probably, but a lot of them have done a good job to ramp up their e-commerce. We’re in the process of setting up drop-ship operations. The brands that will win are the ones that are best able to adjust quickly to meet the demands of these sites and the new way the customer shops.
WWD: How are you doing things differently?
K.N.: One of the main missions is to take our brand equity in sleepwear, bras and underwear to try to become more of a lifestyle brand. So we have ready-to-wear, bedding, towels, legwear, rugs and we’re in talks with a lot of potential licensees about expanding into new categories like shoes or handbags. Natori is our heritage brand but we’ve tried to build a brand pyramid that allows us to hit different price points and distribution. We have N Natori which has done really well at places like Dillard’s; Natori ready-to-wear at HSN, and Josie, our more contemporary collection, is at Nordstrom and Bloomingdale’s.
WWD: How do you manage a business that carries your family’s name?
K.N.: One of the reasons we haven’t expanded more is because we take such pride in every single thing we put out there that has our family name on it. We have five licenses currently. If all we wanted to do was build sales, we could easily find five more tomorrow. We own our factory in the Philippines which does the N Natori collection which starts around $58 and our [signature] collection which can be $4,000 to $6,000. A lot of fashion brands when tasked with trying to create a cheaper collection will certainly find another factory, maybe find a different team and company too.
WWD: What would people be surprised to learn about how the company operates?
K.N.: We live in the same building. My wife and I lived in a small one bedroom and then she got pregnant with our son, who is now eight. We decided we should move and a small unit opened up in my parents’ building. I said no but Anika said, “You know what, let’s do it. It will be great.” So in addition to working together, we also live in the same building. I actually do my best to limit work conversation when we are together as a family, which can be difficult.
WWD: Is your wife still handling the Josie Girl blog?
K.N.: She does. It’s been more than five years and has a great little audience. It’s really more of a lifestyle blog. That’s why it’s resonated well. It’s not some corporate blog where every post is about pitching some Natori thing. She loves creating the content but she loathes and refuses to promote it herself. She wants people to find it on their own. It’s kind of funny. She’s the only blogger with a private Instagram account.
WWD: What’s on the horizon?
K.N.: I’m probably going to retire before my mother. I’m 41 and hope to retire by 71. She is 70 and I have no doubts that when she is 100, she will still be coming into the office. Her mother will be 93 in October. She still runs the family business in the Philippines, goes to work everyday and is as sharp as a knife. My mother has that same energy. She goes to the Philippines 12 times a year, gets off the plane and goes straight to work.