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You can thank some of Los Angeles’ high-profile boutiques for spreading the word about California’s contemporary vendors beyond the state line.

This story first appeared in the January 22, 2004 issue of WWD. Subscribe Today.

New York-based Scoop owner Stefani Greenfield credits friends John Eshaya, vice president of women’s for Ron Herman Melrose Avenue, and Tracey Ross, who owns a boutique by the same name in Sunset Plaza, for turning her on to brands in California seven years ago. “I’m now in L.A. eight times a year,” she said.

Greenfield comes to shop for her seven stores in New York and Miami. “The L.A. vibe is happening: that casual fashion, the surfer thing, the skater thing, the great denim, the sexy knits.”

The signature California contemporary ensemble — jeans with frayed hems; soft, gauzy T-shirts, and stilettos — is a look more and more vendors across the world are gobbling up. When fashion bibles such as Vogue or Elle focus on Los Angeles, it’s the contemporary category that gets the most play. After all, starlets are not averse to strutting the red carpet in a pair of Seven jeans and a Joie tank.

“Contemporary is on fire,” said Sandy Richman, co-principal of Directives West, a retail consulting firm and buying office in downtown Los Angeles’ California Market Center. “We’re seeing double-digit sales increases in the category, and it’s all about the item.”

The contemporary craze comes at a time when the once-sizzling juniors business is cooling. Teens are reallocating their disposable, but limited, dollars to technology toys and other entertainment instead of clothes. Teen spending on apparel and footwear fell 13 percent to $20 billion for the year ending in November, according to data from the NPD Group.

While there are success stories among California-based junior retail chains and vendors that have focused on a niche, others, including Wet Seal and Charlotte Russe, have hit the skids. Once-popular Clothestime went into liquidation in 2003 after nearly 30 years in the business.

The number of contemporary businesses in the state now outstrips those in the junior genre by one-third. “At this point, who would sell your juniors line? So why start a juniors line?” asks Hype owner Uri Harkham.

The L.A. manufacturer insists he’s glad to be out of the juniors business. Three years ago, Harkham washed his hands of it by licensing his younger line, Jonathan Martin, to Swat Fame Inc. He then focused on the more contemporary Hype, which also includes footwear, handbags and a younger kids line. The brand is projected to bring in $100 million in 2004, up 25 percent from last year. Ready-to-wear accounts for about 20 percent of that figure.

Today’s lifestyles are more tuned to contemporary styling, believes Harkham, and “the margins are better. If you’re going to get the financing, you might as well get it for a company that you can at least charge something for the product.”

Sticker shock isn’t necessarily an issue with contemporary buyers, said Ilse Metchek, executive director of the California Fashion Association. Contemporary buyers don’t ask how much if it’s a new look,” Metchek noted.

Catering to the 25- to 40-year-old market and typically retailing for $100 to $400, the state’s contemporary segment is hard to quantify in sales volume because some companies call themselves contemporary when they’re not. Angling for affiliation with contemporary fashions is just another sign of the category’s strength in the marketplace and its reputation for being fashion-forward but priced considerably less than designer brands.

“With the rougher economy, some people can’t afford to buy designer, and many are putting their dollars in contemporary for a fraction of the cost,” observed Ed Mandelbaum, co-founder of the contemporary-heavy trade show Designers & Agents.

In fact, D&A’s phenomenal success also speaks to the category’s importance. What started out six years ago with five showrooms at the New Mart in downtown Los Angeles has expanded to five shows a year in Los Angeles, four in New York and two in Tokyo, representing dressy, denim, sportswear and accessories lines — many from California.

“There’s lots of creativity in California: The lifestyle is a bit more gentle, the cost of living is less expensive [than New York] and the manufacturers in the state have a great track record of working with young designers,” said D&A co-founder Barbara Kramer.

The region’s ability to produce high-quality goods quickly and cost-effectively gives makers from the state a leg up on the competition, many in the industry believe, especially when dealing with hefty demands from department stores.

“The denim resources are actually a great example of the importance of California resources,” said Denise Lawson-Curry, Macy’s West’s vice president and divisional merchandising manager of bridge, contemporary and status sportswear. “While most resources might purchase denim from Italy, production and fit are all done in California. This way, the fit and details can be monitored and adjusted immediately if needed. Then they can be in our stores the next day.”

Stores halfway across the country also appreciate the receptivity of California sales reps in replenishing goods. Barely open three months, Standard in suburban Kansas City, Kan., routinely sells out of its California lines. Owners Matt and Emily Baldwin devote 65 percent of the store’s inventory to Golden State brands such as Blue Cult, Tiffany Alana, Juicy Couture, Trina Turk, James Perse and Joie.

“My reps in general are great to work with and take good care of me — even though I’m out here,” said Emily Baldwin, who expects to pull in $1 million in first-year sales.

Erica Thomas, owner of the Erica Dee boutique in Corona del Mar, Calif., whose sales last year more than doubled to $1.5 million since opening in 2001, said she appreciates California designers because “they know the marketplace and quickly refill orders if I sell out.”

That turnaround helps since “sold out” is a common phrase heard among area boutiques when they seize on a trend. Thomas, who relies on California designers such as Citizens of Humanity and Juicy Couture for 60 percent of her inventory, said the 500-piece T-shirt order she receives from red-hot C&C California flies off the shelves in one week.

At Macy’s West, the San Francisco-based division of Federated Department Stores Inc., the contemporary department called Impulse was added seven years ago when the retailer saw the category take hold beyond specialty boutiques. Today, Impulse is in about a third of its 144 doors. L.A. lines such as Seven, True Meaning, Frankie B., Single and Joe’s Jeans all have a presence in the brightly painted department.

“The business has grown tenfold in the past seven years, and we have yet to reach our potential,” Macy’s Lawson-Curry said.

Once considered a no-no, there is now growing importance placed on having a presence in department stores, according to Trish Moreno, owner of consulting firm Trendsyndicate. “It legitimizes the business,” she said. “L.A. designers want global recognition and growth, and part of that is getting into the majors.”

Just how quickly companies want to grow their business is a study in contrasts.

There’s the heavily exposed Von Dutch, which has a licensing deal with juniors retailer Gadzooks and is rolling out new stores to show its popular trucker hats. Then, there are the lines, such as Development and Burning Torch, slowly building their presence without the hype.

Burning Torch owner Karyn Craven began her business selling unique, recycled vintage wares about three years ago, and now focuses on vintage-styled garments. “We’re just a quiet resource in California,” said Craven, who doubled the business to $6 million in sales last year and is expected to hit $8 million in 2004.

Joie co-owner Sean Barron, who sells to 500 doors in the United States, including Bloomingdale’s, Barneys New York, Tracey Ross and Planet Blue, also takes this perspective and doesn’t want to add any more accounts here. Instead, she’s looking to grow by expanding her fledgling base in Europe. “We don’t want to cannibalize sales, we just want to work with the same customers and become more important to them by selling them more items.”