NEW YORK — While the downfall of LF Brands has had a dramatic impact on its employees, it is not expected to create any seismic activity in the moderate sportswear market.
This story first appeared in the January 7, 2004 issue of WWD. Subscribe Today.
The $120 million LF Brands, which shut down operations Christmas week and on Friday sold its Cynthia Steffe division to Bernard Chaus Inc., is expected to file for bankruptcy court protection this week. Its brands, including the core Leslie Fay Dress and Sportswear brands, are being shopped around.
The former Leslie Fay Co. is said to have derived about one-third of its sales from sportswear. In a world of multibillion-dollar giants, such as Jones Apparel Group, Liz Claiborne Inc., Kellwood Co. and other smaller but considerable vendors, the scramble to grab its market share should be a minor tussle.
Several executives noted that the Leslie Fay brand has not been a force in the sportswear market for three to four years and added that, although there is some business to pick up, the opportunity has failed to create any kind of rush so far.
Consultant Emanuel Weintraub added, “Until the dust settles, I don’t think there is a clear picture as to the opportunities [for other vendors]. I’m not sure that there are huge opportunities.”
Business left on the table by LF, said Weintraub “should be very interesting to the $100 million to $200 million firm that’s looking for an entree. Leslie Fay has a good relationship with Dillard’s.”
Dillard’s Inc. is said to have been one of LF’s largest customers and, accordingly, might have the most work to do in the wake of the company’s collapse. A Dillard’s spokeswoman declined comment.
However, LF, in another form, might yet retain some of its sales.
“It’s sad to see such a good label go away,” said Gary Gladding, executive vice president of merchandising at Gottschalk’s, a moderate chain based in Fresno, Calif. “But then again, who knows what will happen with the name and who will end up with it. The name may stay around with different owners.”
Gottschalk’s currently carries the Leslie Fay Dress label, which it picked up about nine months ago after a hiatus of not carrying LF Brands merchandise.
“Leslie Fay Dress is a very good dress line for the mature customer,” Gladding said. “The closing of the line will certainly create a void in the market. We thought the company had worked out some of its problems, including sourcing issues, so we had started carrying them again.”
Last year, LF Brands teamed with Li & Fung to have the specialist source all its merchandise.
“The impact of LF Brands closing will vary,” Gladding added. “It could be difficult for some retailers that did significant business with them. But for us, it was only a small portion.”