Retail Helps Splendid Grow
Expansion can be tricky these days, with the recession forcing many companies to take a cautious stance. But some brands are finding ways to grow even as they feel the economic pinch. Moise Emquies, founder and chief executive of the Los Angeles–based Splendid and Ella Moss knitwear brands, isn’t letting the down economy stymie his business’s growth.
On Nov. 20, Splendid opened its first flagship retail location on Robertson Boulevard.
The 2,500-square-foot location will sell the brand’s Splendid, Splendid Mills, Splendid Mills Jr., Splendid Girl and Splendid Littles labels, as well as the first few pieces from the new Splendid Home line and exclusive gift sets not available elsewhere. Airy and comfortable, the space’s design was an in-house effort, with Emquies’ wife, interior designer Carol Ann Emquies of Blinken Interiors, helping to design the space.
The Los Angeles company is getting an assist from its new parent company, Greensboro, N.C.–based VF Corp. Splendid, along with Emquies’ pricier Ella Moss brand, was fully acquired by VF earlier this year. The VF retail team, which has had experience launching retail stores for some of its other brands, including 7 For All Mankind, helped to plan and launch the store.
Emquies, who sees Splendid continuing to grow into new categories, said the flagship was created to communicate the Splendid message directly to consumers.
“Opening a store can only help a brand. This is the first time we’re able to communicate the idea of ’Splendid life’ and showcase the brand under one roof,” he said. The store will also act as a test lab and launching pad for subsequent Splendid products. Right now, logo hoodies, the first ever in the collection, are being tested in the store. Soon, Splendid Layers, a new capsule of whisper-thin layering pieces for women, will debut at the store.
The store will also function as a marketing tool for the brand, which is in the process of reorganizing its overseas distribution. Earlier this year, Splendid brought its overseas distribution back in-house and opened a showroom in Milan. “We’re still a wholesale company, and one of our focuses is global expansion,” Emquies said. The location was chosen not just for its steady foot traffic but for its international appeal.
“Robertson is one of the preeminent shopping streets in Los Angeles,” he said, adding that it is also packed to the gills with overseas tourists. A retail store is a good way to make an impression on those tourists and potentially those tourists will become loyal customers back home. Local shoppers will also be targeted at the store, with events such as backgammon tournaments staggered throughout the year. (Emquies is a big fan of the game and made sure a backgammon table was installed at the store.)
“Most stores [on Robertson] are dark and serious. The Splendid store is not one of those stores,” Emquies said. With items selling for $30 to $200, a life-size horse statue greeting shoppers, cloud fixtures dangling overhead, a floor-to-ceiling wall of plants and a front door that spans the whole of the storefront, the retail space is more feel-good than hoity-toity.
Retail and brand building have been goals for Splendid and Ella Moss, as well as for parent company VF, which earlier this fall hired retail executive Susan Kellogg as president of its contemporary brands coalition, which includes Splendid, Ella Moss, 7 For All Mankind and John Varvatos.
Still, while the store represents an opportunity for Splendid, it also reflects the difficulties apparel makers are experiencing.
Earlier this year, Splendid Boy, a T-shirt line for boys, had to be shuttered because of so many children’s retailers closing and a price point that was deemed too high, Emquies said.
Between Ella Moss and Splendid, Emquies estimates that he sells 2 million to 3 million units per year. The brands retail in approximately 1,500 doors worldwide, with Splendid accounting for the larger portion of sales. In an interview this summer, Emquies said that for 2010 both brands were hoping to supplement those sales with a rollout of five stores each. “I said I wouldn’t do retail. I changed my mind. [A brand] can really make money in retail,” he said. Now those plans have changed. “We don’t want to get ahead of ourselves. Right now, we’re testing the retail concept, and we’ll see how it goes,” Emquies said. “Before, we had a great small-boutique business, but the recession cost us a lot of these accounts.” Additional retail locations could be a way to bolster sales, but for now, it is still a moving target.
VF Corp.—which is valued at $7.6 billion and owns brands such as Nautica, Vans, Reef, Wrangler, Lee and The North Face—earned revenues of $5.3 billion during the first nine months of 2009—down 7 percent from the same period in 2008. The contemporary-brands coalition saw its revenues increase by 3 percent for the third quarter of 2009—with Splendid and Ella Moss notably contributing $20 million.
