Iconix Lays Off Op Staff, Closes Irvine Office

The empty Ocean Pacific booth at the Action Sports Retailer Trade Expo in San Diego last month proved to be an indication of things to come for the iconic surf brand. Just three months after announcing its acquisition of core surf brand Op, New York–based Iconix Brand Group has closed the brand’s Irvine, Calif., headquarters and dismissed its staff of approximately 18 employees. Operations for the surf brand will now be handled out of Iconix’s New York office, which also manages the company’s other brands, including Bongo, Badgley Mischka, Candie’s, London Fog and Joe Boxer.

The news, which came as a surprise to some, was delivered Jan. 30, and the doors closed Feb. 2, insiders said. “Iconix determined the services we had in Irvine were duplicate in nature to what they had in New York,” said Andrew Lelchuk, Op’s former senior vice president.

Executives at Iconix could not be reached for comment.

Sources said Op Chief Executive Dick Baker is in talks to act as a consultant for the brand, whose future is still uncertain. “Iconix is still trying to find a direct-to-retail partner” in the mass-market arena, an insider said. This is a familiar route for Iconix, which partnered with Kmart to exclusively distribute its Joe Boxer brand in the United States.

Former owner Warnaco Group Inc. halted production and development for Op last year, effectively cancelling any deliveries of the brand’s apparel until at least Spring 2008, when Iconix’s first collection for the brand is tentatively set to debut.

Core no more

According to sources, there had been a hope that Iconix would create an “Iconix West” branch to accommodate Op and its other West Coast–based acquisitions, which include Mossimo and Rampage, helping keep the brand core by proxy. When the acquisition was first announced, Iconix chief Neil Cole praised the brand’s authenticity, saying part of the reason the brand was so enticing was its iconic history. As recently as December, Cole said the plan was to keep Op where it is to help retain some of its authenticity. “Up until Tuesday of last week, there was a small opportunity that we could keep up our work at Op,” Lelchuk said. “Now we’re all out pounding the pavement.” Some executives, including Eric Crane and Gary Siskar, left the company before the ax fell. Crane, Op’s former senior vice president and creative director, joined accessories maker Nixon as director of product and design.

Now all of Op’s ties to the West Coast surf culture that inspired it are severed. “The brand is losing its sense of ’core’ by necessity,” said a source who requested anonymity.

“You can’t run a surf company out of New York. They’ve got no ties to the surf industry. It’s like watching a friend die a slow and agonizing death.”

Steve Pezman, publisher of The Surfer’s Journal, said “It’s sort of sad to see a grand name of the sport move to New York and end that way. Op has been floating away from the core surf industry for a while. Now it’ll be in another universe.”

Some observers aren’t surprised at Op’s latest incarnation. “Op has been on the fringes for 15 years, and now it’s going in a different direction again,” said Marie Case, a consultant with market-research firm BoardTrac. After establishing itself as a godfather of fashion surf apparel, the brand stumbled in the ’90s, filing for bankruptcy protection in 1992. In 2004, Warnaco purchased Op for $40 million once Baker, the brand’s chief executive, had returned the brand to some of its former glory. Under Warnaco, Op brought the bulk of its apparel licenses back in-house and focused on pulling nostalgic designs from its archives. Baker, who joined the surf industry after marshalling brands such as Esprit and Tommy Hilfiger, himself became synonymous with surf culture, eventually taking on the role of president of the Surf Industry Manufacturers Association.

If Op ends up selling exclusively in Wal-Mart, Target or another mass retailer, the brand’s latest embodiment could have a positive effect on the industry, Case said. “A true surfer would never be caught dead in it—the same way they wouldn’t be caught dead in Hollister [a surf-inspired brand by New Albany, Ohio–based Abercrombie & Fitch Co.]. They’ll become a brand that is associated with surf that is sold to the masses. But it has the effect of making the smaller, up-andcoming brands with tighter distribution cooler by comparison. Core surf retailers are dying for hot new brands because the big guys—the Quiksilvers and Billabongs of the industry—are also expanding their distribution out of core channels. It’s a return to the old adage ’Inaccessibility creates demand,’” she said.

Pezman, a big advocate of protecting surfing’s soul, doesn’t savor the idea of an iconic surf brand being pumped to the masses. “Surfing used to be about rebelling against that, standing apart,” he said. There is no word yet on what plans, if any, Iconix has for Mossimo’s Santa Monica, Calif.–based office. Larry Hansel, who founded Rampage and now holds the license to design and manufacture the brand’s apparel, said the move has no effect on his business or his Los Angeles–based office.