California Apparel News

The economy did not rebound as quickly as many would have liked in 2011—but it did rebound. The news of the year included clear signs of economic recovery, including the sale of Volcom for more than $700 million to luxury firm PPR. Forever 21 continued its international expansion, setting its sights on China and Europe. Lawmakers finally passed a series of free-trade agreements—most significantly, the agreement with South Korea, which stands to open new opportunities for apparel businesses. Retailers and manufacturers found new business opportunities in social networking, and consumers embraced shopping from the palm of their hands.

It was all part of the news of 2011.

Agenda

Once a smaller satellite show to the longstanding Action Sports Retailer Trade Expo, Agenda has grown beyond its focus on emerging streetwear brands to showcase a mix of contemporary, street, skate and surf brands at trade events in Southern California, New York and Tokyo.

Founded in 2002, Agenda has carefully cultivated a balance between championing independent labels with expanding and providing a space to do serious business for high-profile brands such as Vans and Volcom, both of which are owned by public companies.

Agenda also is reaping the benefits of being the last show standing in its market. In 2010, Action Sports Retailer Trade Expo closed after 29 years as the dominant surf and action-sports trade show on the West Coast. The Class@ASR mini trade show folded that year, and in 2011 its parent show, Class, went on hiatus. In ASR’s wake, the biannual Agenda has been the go-to place for surf and skate fashion, said Bod Boyle, president of Dwindle Distribution.

“Last year, there were options,” Boyle told California Apparel News in August. “[Now,] if you want to meet people from a company, you have to come to Agenda.”

Agenda thrived because it has expanded in a sensible way, said Cody De Backer, brand manager at the 722 Figueroa showroom in Los Angeles, who has been representing brands at Agenda since 2004. “It has always grown within its means,” De Backer said of Agenda, which is owned by Aaron Levant. “It still feels like a community and a family when you walk in the doors.”

Come January, Agenda will have the opportunity to expand that community feeling to its largest venue yet. The Jan. 5–6 run of Agenda will be held within 235,000 square feet of space at Southern California’s Long Beach Convention Center.—Andrew Asch

Bloggers as Style Icons

Bloggers are becoming to the fashion world what celebrity is to Hollywood. Bloggers have become increasingly respected and sought after for their fashion opinions and personal style. Posting stylish looks on their blogs has led to photographs on the street and at fashion events. Fashion brands and e-tailers have turned to bloggers to help influence their customers for ad campaigns and design collaborations.

In turn, bloggers have become the next style icons. Top bloggers—think Hanneli Mustaparta, Jane Aldridge, Rumi Neely, Garance Dore, Tavi Gevinson, Susie Bubble, Leandra Medine and Bryan Boy—have become well-known names in the fashion industry. They receive front-row seats at coveted fashion shows and have become identifiable for their own sense of style.

Sea of Shoes’ Jane Aldridge and her mother, Judy, have been featured in Vogue. Susie Bubble was featured in The Gap’s holiday campaign. Because I’m Addicted’s Geri Hirsch appeared in JCPenney commercials, and Hanneli Mustaparta starred in Net-a-Porter’s ad campaign.

Online promotions, campaigns and designer collabs continue to expand with top fashion brands, stores and houses—from Urban Outfitters to Coach. H&M tapped Swedish blogger Elin Kling for its first non-designer collaboration, and Volcom collaborated with Natalie Suarez from Natalie-Off-Duty.

In addition, bloggers are some of most photographed personalities during fashion weeks around the world. What is being worn on the street and to the shows is becoming just as important as what is being shown on the runway. Designers are taking notice and seeking out bloggers to wear their clothes at fashion’s most high-profile events. During New York Fashion Week in September, Style.com partnered with Net-a-Porter and American Express to launch “NY Street Seen,” a shopping platform that allowed customers to shop instantly for their favorite looks worn by Fashion Week attendees.

The new generation of fashionistas looks up to these faces, who post photos of themselves in stylish—and, often, attainable—outfits. They help translate designer looks into reality by mixing and matching high-end looks with vintage finds and lower-priced items from H&M and Target.—N. Jayne Seward

Cotton

The year opened with cotton prices at an all-time high of $1.68 per pound—and they kept rising. 2011 was on track to be even worse than 2010, when global cotton prices shot up 117 percent between January and December, according to the National Cotton Council.

But the $2.29 price per pound in March proved to be the peak for the year. From there the price continued to fall until it reached $1.05 per pound in November, the NCC’s most recent figures.

Despite the welcome respite, industry experts warned apparel makers not to become too complacent.

“Six months ago, cotton was trading at a dollar and a half—and it sailed past that,” said O.A. Cleveland, a professor emeritus from Mississippi State University, speaking to a group of denim-mill representatives in July. “We have come down 50 cents in just six weeks. I think we’ll continue to see such price volatility. I anticipate that the market will be a bit more stable, but I think that anything from $1 to $1.10, you should be fairly aggressive. Now’s the time to buy.”

Going forward, the U.S. Department of Agriculture is anticipating lower demand for cotton due to economic uncertainty and a switch to man-made fibers. According to the USDA’s World Agricultural Outlook Board, “World consumption is reduced sharply [in 2012], reflecting continued weak mill demand owing to an uncertain world economic outlook and a loss of fiber share to polyester.”

Falling demand and excess cotton supply could keep prices in check in the coming year.—Alison A. Nieder

Cynthia Ruiz

After more than seven years as president of the City of Los Angeles Board of Public Works, Cynthia Ruiz moved in May to the Port of Los Angeles as its executive director of external relations. While on the Board of Public Works, Ruiz also served as Mayor Antonio Villaraigosa’s “fashion ambassador,” helping raise the profile of Los Angeles fashion industry by attending fashion functions, enlisting the mayor’s participation and, last year, spearheading Los Angeles’ official participation in Fashion’s Night Out, the shopping event launched by Vogue magazine, the Council of Fashion Designers of America, NYC & Co. and the city of New York.

When she took the job at the Port of Los Angeles, Port Executive Director Geraldine Knatz praised Ruiz’s “experience and ’go-to’ reputation for helping to make things happen in L.A.”

Ruiz continued to support and assist the fashion industry. Under her direction, the port hosted a booth in the Americas Pavilion at Sourcing at MAGIC in Las Vegas in August. Assisted by port officials and the California Fashion Association’s Ilse Metchek, Ruiz spread the word about export opportunities and assistance for U.S. apparel brands. At the show, Ruiz and Francisco J. Sanchez, under secretary for international trade with the U.S. Department of Commerce, announced a pilot program initiated by the port and several export-assistance agencies to help Los Angeles manufacturer Moshe Tsabag begin exporting his juniors label, Velvet Heart, to China.

The endeavor is part of President Obama’s initiative to double U.S. exports by 2014, which will bolster U.S. business, Sanchez said. “The more businesses export, the more they produce,” he said. “The [apparel] industry remains a critical force in our economy.”

Ruiz said the Department of Commerce in Shanghai is currently helping to look for reputable distributors for Velvet Heart in China. “It’s been a hard nut to crack,” she said, but added that progress is being made. A trip to Shanghai is planned for early next year, and Ruiz said she’s hoping Kent Smith, executive director of the Los Angeles Fashion District, will join the group to help identify other local apparel companies looking to export to China.

“I’m excited to have the opportunity to work with the fashion industry from the business end of it,” she said. “At the end of the day, it’s all about creating jobs.”

Earlier this month, Ruiz received the Ray of HOPE award from Hispanas Organized for Political Equality. —A.A.N.

Forever 21

Forever 21 has never been shy about opening stores.

But this year it has set its sights even broader, looking to China and Europe as major expansion venues.

Recently, the Los Angeles retailer, whose 2011 revenues are expected to reach $3.4 billion, announced it would open three stores in China. The company’s Hong Kong store, located at Capitol Centre in Causeway Bay, is scheduled to throw open its doors in late January. By spring 2012, the bargain-basement chain, which stocks new fashion as fast as it flies off the shelf, will have a new store in Shanghai and another in Beijing, company officials said.

Asia is just one area where the company is setting its expansion sights. Europe is a major focal point, too. In 2010, Forever 21’s first European store was established in Birmingham, England.

This year, the company has been busy expanding outlets in Vienna, Austria; Barcelona, Spain; and Brussels and Antwerp, Belgium.

Last July, hordes of shoppers formed a line that snaked around the new three-story Forever 21 flagship store on Oxford Street in London. Linda Chang, daughter of the company’s founders, was on hand for opening day. #8232;More European stores are on the way. Next year, Forever 21 will try to conquer the fashion capital of Paris with a new store on the chic Rue Rivoli.

At the end of this year, Forever 21’s lineup of emporiums totaled 497 in the United States, Canada, Europe and Asia.

This is a long way from 1984, when the company opened its first store, called Fashion 21, in Los Angeles’ Highland Park.—Deborah Belgum

Free-Trade Pacts

For nearly three years, the United States saw no new free-trade agreements come on line, a rare event considering that the Bush administration was busy signing free-trade pacts as fast as pen could be put to paper.

This year, the Obama administration finally signed off on three free-trade pacts—with South Korea, Colombia and Panama—that should go into effect in 2012.

The apparel industry won’t see that much difference when trading with Colombia because that South American country already receives trade preferences under the Andean Trade Preference Act. And Panama has never been a major import market for clothing.

Apparel manufacturers will gain the most benefit in South Korea, a major textile manufacturer. U.S. clothing factories will be able to bring in regionally made Korean textiles and apparel duty free, saving up to 32 percent in import taxes on things such as synthetic fabrics.

At the same time, some Los Angeles retailers and manufacturers are busy expanding their business plans to South Korea. Rhapsody Clothing Inc., headed by Bryan Kang, makes apparel in Los Angeles and plans to export it to South Korea, where the company is setting up a retail chain called Love Scene. Kang expects to have 100 shops open by the end of 2012.

California retailer Bebe already has opened three stores in South Korea this year.#8232;

The three free-trade agreements have been in limbo for years. They were negotiated and signed during the administration of George W. Bush, who was a free-trade advocate. Under his watch, he championed a host of free-trade accords with Central America, Jordan, Morocco, Chile, Oman, Singapore and Australia.

All three new free-trade agreements are expected to boost U.S. exports by more than $12 billion a year.—D.B.

Golden Gate Capital and Infor Buy Lawson Software

In March, St. Paul, Minn.–based enterprise solutions software firm Lawson Software Inc. received an unsolicited proposal from private-equity firm Golden Gate Capital and software provider Infor. It was a good one. Golden Gate Capital and Infor offered to buy all of Lawson’s outstanding stock at $11.25 per share—at the time, a 14 percent premium over Lawson’s share price.

San Francisco–based Golden Gate Capital is no stranger to the apparel industry. Among its fashion and footwear investments are Express, J.Jill, Eddie Bauer, Rocketdog—and, most recently, Pacific Sunwear of California. Alpharetta, Ga.–based business software provider Infor counts more than 1,100 apparel and footwear companies among its 70,000 customers in 125 countries.

Lawson’s board announced it needed time to consider the offer—and brought in Barclays Capital Inc. as financial adviser on the proposal. But by the end of April, Lawson’s board unanimously agreed to the $2 billion buyout deal. #8232;Lawson’s software solutions for the fashion industry include enterprise business software as well as solutions designed for apparel manufacturers and retailers such as Lawson Fashion PLM, Assortment Replenishment Planner and Point-of-Sale Integration and Analytics for Fashion. Infor’s apparel-specific products include enterprise resource planning, supply-chain management, product lifecycle management, performance management and customer-relations management solutions.—A.A.N.

The Gores Group

For 25 years, private-equity firm The Gores Group saw great potential in buying up underperforming technological and industrial companies, improving their state of affairs, and then selling them for a nice profit.

Last year, the Los Angeles venture, headed by Alec Gores, discovered the apparel industry—and the buying spree continued throughout 2011.

Making its first purchase in the apparel field, The Gores Group acquired a controlling interest in New York luxury brand J. Mendel. Since becoming a partner in the luxury label, helmed by Gilles Mendel, The Gores Group has helped the company gain more financing and narrowed the label’s collection to primarily pricey dresses and fur.

Earlier this year, The Gores Group acquired a two-thirds interest in Los Angeles juniors apparel manufacturer Big Strike Inc., a $100 million company whose main labels are HeartSoul and Soulmate, sold at JCPenney, Sears and Kohl’s.

The Gores Group wants to put Big Strike’s revenues on steroids and increase them to about $200 million to $400 million a year before selling the manufacturer or taking it public. Already, HeartSoul is being expanded into misses.

On the heels of its Big Strike purchase, The Gores Group surprised everyone by buying 81.75 percent of Mexx, the ailing retailer owned by Liz Claiborne Inc. in New York. The chain of stores, located in Europe and Canada, had an operating loss of $100 million last year on $732 million in revenues.

To improve profits, The Gores Group is planning, by the end of 2012, to close 110 underperforming stores of the 167 company-owned stores in Europe. It will open outposts in more-lucrative locations with the goal of establishing 10 new stores a year starting in 2013. Already, a new sleek metropolitan-style store design is being rolled out in Antwerp and Brussels, Belgium; Stockholm; and Krefeld, Germany. In Europe, there are still 377 franchised stores and 31 concession stores.

Also this year, The Gores Group bought Scovill Fasteners out of bankruptcy.—D.B.

Ilse Metchek, President, CFA

Ilse Metchek, who has been involved in the Los Angeles apparel industry for more than 40 years, first as a designer and now head of the nonprofit California Fashion Association, has focused her attention this year on boosting up jobs in the apparel manufacturing sector and looking for economic opportunities for apparel companies.

At the same time, she has hosted a slew of seminars on everything from issues for U.S. fashion retailing to building your retail brand to educating local companies about current issues.

For several years now, the CFA has organized the annual “Crystal Ball” meeting for members who gather to hear the predictions of Wells Fargo economist Eugenio Alemaacute;n, who never minces words, and the retail outlook from Marshal Cohen of The NPD Group.

Metchek, who has headed the CFA since it was formed in 1994, is sought out for her knowledge of an industry that is responsible for more than $40 billion in apparel shipments and more than $13 billion in local manufacturing revenues.

The CFA took over administration of the Textile Association of Los Angeles last year, boosting its membership this year from 71 to 95 members.

One of Metchek’s toughest battles has been over the Innovative Design Protection and Piracy Prevention Act. She and other CFA members, such as Lonnie Kane of Karen Kane and Steve Maiman of Stony Apparel, made several trips to Washington, D.C., this year to talk to lawmakers, including Sen. Dianne Feinstein of California and Sen. Charles Schumer of New York, about why they shouldn’t support the bill.

The law would protect, for three years, new, unique and original artwork created by a fashion designer. The CFA opposes the law because the organization believes the law would foster a wave of frivolous lawsuits.

In keeping with her goal of boosting apparel-industry jobs, Metchek launched a new California fashion manufacturing website this year to encourage more investment and manufacturing in the region.—D.B.

Interchange Fees

The financial overhaul law of 2010 set into motion one of the big legal battles of 2011—the fight over debit-card interchange fees. These “swipe fees” are the payments retailers send to banks whenever a debit card is used—and they add up to $20 billion annually, according to the Retail Industry Leaders Association trade group.

The sprawling financial overhaul bill included the Durbin Interchange Amendment, which mandated that debit-card swipe fees be “reasonable and proportional” to a purchase. The job of choosing how much the charge would be cut was delegated to the Federal Reserve in December 2010.

During the first half of 2011, banks and their allies spent more than hundreds of thousands of dollars lobbying Congress to limit the reform or even postpone it. By July, the Fed chose to cut the fee from 44 cents per transaction to 21 cents. The original recommendation for the cut was 12 cents. By October, swipe-fee reform went into effect.

The compromise satisfied no one. But in a Dec. 12 blog post, Sandy Kennedy, RILA’s president, called swipe-fee reform one of the retail industry’s top five legislative victories of 2011. For 2012, she also promised that her trade group will strengthen debit reforms and extend the reforms to credit cards.—A.A.

Levi Strauss & Co.

A denim pioneer since 1853, Levi Strauss & Co. made news this year with a host of innovative collaborations and initiatives that have kept the denim giant at the top of its game.

From partnering with Industrie Denim on a revolutionary jeans bar to collaborating with the Museum of Contemporary Art in Los Angeles to create art out of Levi’s jackets, the iconic label has continued to reinvent itself.

Levi’s partnered with American Rag founder Mark Werts to launch premium-denim houses that feature an extensive range of brands and prices, complete with in-house denim experts, on-site alterations and “booty cams” for checking out posterior fits. The first Industrie Denim opened in Scottsdale, Ariz., followed by a second store, in San Francisco, with more slated to come in 2012.

The denim brand also forged a partnership with the Museum of Contemporary Art to celebrate the institution’s “Art in the Streets” exhibition. The company designed a limited-edition collection of Levi’s Trucker jackets featuring artwork by some of the art community’s most influential graffiti and street artists—including Keith Haring, Shepard Fairey, Chaz Bojorquez, Kenny Scharf, Lady Pink and KR—to help raise money for the museum.

“Levi’s was a very natural sponsor and partner for the “Art in the Streets” exhibition because the artists wear Levi’s and they like Levi’s, so it’s a very credible association,” said Jeffrey Deitch, the director of the museum. “They were ideal partners because they were not just sponsors but creative partners. They developed a film workshop with us. It wasn’t a conventional pop-up store; it was a workshop that really engaged the community.”

This year also witnessed Levi’s embracing of the Better Cotton Initiative, a program that promotes fair labor, increased financial profit for small farmers, and the use of sustainably grown cotton developed with less water and fewer pesticides. The company has already released 2 million pairs of jeans made with Better Cotton to help reduce its environmental impact and improve the lives of cotton farmers.

“We strongly believe that Better Cotton farming techniques are the long-term solution,” Michael Kobori, Levi’s vice president of social and environmental sustainability, said. “They’re better for farmers, better for companies that sell textiles and clothing, and better for the environment.”

In between adopting sustainable practices and supporting contemporary art, Levi’s also found time to manage a global anti-counterfeiting program training law enforcement and prosecutors’ offices around the world, open a new two-story bespoke store in Amsterdam featuring creative cultural exhibitions and performances from local artists, and hire Chip Bergh as the new president and chief executive officer of the company.—Deidre Crawford

M-Commerce

E-commerce sales are skyrocketing, but the future is mobile.

M-commerce was the talk dominating leading industry conventions such as eTail 2011, held in Palm Desert, Calif., in March. And over the last 18 months, retailers such as Target Corp., The Wet Seal Inc., HauteLook Inc. (owned by Nordstrom) and Karmaloop (b) made investments in m-commerce with mobile phone and tablet applications that let consumers shop from the palm of their hands.

“2011 will be known as the last year traditional e-commerce did more business than m-commerce,” said Greg Selkoe, founder and chief executive of Karmaloop, a Boston-based retailer devoted to selling streetwear and fashion online. “In 2012 m-commerce will take over.”

Selkoe based his forecast on the direction the industry is moving and by the devices that consumers use to make purchases on Karmaloop, which had revenues of $140 million in 2010.

Most Karmaloop shoppers accessed the site through traditional e-commerce means—through a PC and the Mozilla Firefox Web browser. But following closely were purchases made via iPhones, the device that currently dominates American m-commerce. As smart-phone technology improves, and as sales for tablet mobile devices, such as the iPad, increase, Selkoe expects the focus of the e-commerce business to shift to mobile devices.

Still, it won’t be a sudden takeover. The economy must give time for m-commerce to grow, counseled Forrester Research analyst Sucharita Malpuru in a June 17 blog. Forrester predicted m-commerce sales to grow 40 percent each year for the next five years; however, m-commerce will still be small. In 2011, it was forecast to be 2 percent of online Web sales.—A.A.

Missoni for Target and Versace for H&M

When Target announced a new capsule collection of fashion and home deacute;cor by Italian luxury label Missoni, the Minneapolis discount retailer had no way of knowing it would be the capsule collection that brought down a website.

The launch of the Missoni for Target line on Sept. 13 drew crowds of frenzied buyers to Target stores and such a surge in traffic to Target’s website (www.target.com) that the site went down for three hours. When the dust settled, all the Missoni for Target merchandise was sold out and the company issued a statement about the incident:

“Target.com is seeing greater item demand than we do on a typical Black Friday, and the excitement for this limited-time designer collection is unprecedented. We are slowly bringing the site back online to ensure we can provide a positive shopping experience to our guests,” the statement read.

Retail pundits called it an “unforgivable” error, but it seemed to have little impact on the discounter’s same-store sales, which rose steadily in September (up 5.3 percent), October (up 3.3 percent) and November (up 1.8 percent).

Two months later, another high-low capsule collection—this time, Versace for H&M—drew a similar response. The collection sold out in less than an hour in many H&M stores across the world. Crowds mobbed stores in New York, London and Hong Kong. And the U.K. website for the Swedish fast-fashion retailer crashed.

Unlike Target, H&M seemed to be anticipating the in-store response to the capsule collection, with many stores limiting the amount of time shoppers could spend browsing the collection and limiting the number of items each could buy.

Many visitors to the H&M e-commerce site in the United Kingdom were met with an apology: “We’re sorry! We are experiencing large numbers of visitors at the moment. Please try again later.” But U.S. customers had only one option if they wanted to buy the line—in the physical store. The fast-fashion emporium does not have a U.S. web store. H&M’s U.S. e-commerce site is expected to launch next year.—A.A.N.

Social Shopping

Some say it’s only valuable for marketing, and others forecast it is blossoming into a crucial and lucrative business. Yet Facebook and other social media proved indispensable to retailers in 2011.

It is the most powerful tool to contact young people, Tina Wells, a marketing pundit, told California Apparel News in June. “If [businesses are] looking for a universal platform for marketing to today’s youth, Facebook is the closest thing to that today.”

In that spirit, Christian Taylor debuted Payvment this year. The Palo Alto, Calif.–based company helps retailers open stores on Facebook using the social network’s free technology.

If a Facebook user notes that he or she likes a certain garment on the social media site, the “like,” or notice of approval, is spread through all of his or her friends’ profiles. Taylor argued that one person’s vote for a designer on Facebook can turn into a trend, and the F-commerce has the potential to quickly turn a “like” into a purchase.

Similarly, San Francisco–based Sneakpeeq, founded by Henry Kim and Harish Abbott, fuses the social aspects of traditional mall shopping and Facebook into an online shopping game in which players get incentives for repeat visits, brand loyalty and sharing shopping finds with friends.

“We started looking at people’s behavior at the mall,” Kim said. “If you walk into a mall and you see something you like, you go over and flip over the price tag. For us that’s a ’peeq.’”

Once a person has “peeqed” at a price on Sneakpeeq, they have the opportunity to “post to the social stream” on Facebook, Kim said, adding, “When you do that, you have the opportunity to bring more people into the ’mall.’”

Other retailers use Facebook to help build a deeper connection with their customers. E-tailer ShopRuche and multi-channel retailer Planet Blue often place pictures of garments on their Facebook page, Tumblr or Twitter sites to ask their clients for opinions of garments. Traffic increases and more sales are made when clients are engaged on social media, said ShopRuche and Planet Blue representatives.

Facebook has become crucial for retailers that focus on bricks-and-mortar operations. Erin Crandall runs New York–based boutique A Man and a Woman and formerly worked at e-tailer ShopBop.

“It’s unbelievable to me that even three or four years ago, while I was at Shopbop, Twitter didn’t exist, and we didn’t need to consider our Twitter feed and Facebook page when new product came in. Now, every time we get in new product, have a trunk show or even find an inspiring picture, it goes on our Facebook, Twitter and/or Tumblr pages. It has changed the way I look at promotions and ways to reach customers and represent my brand,” Crandall said. A Man and a Woman will debut an e-commerce operation this month.—A.A.

Vernon

With lawmakers slinging accusations of corruption and the threat of losing California manufacturers in a depressed economy, the tiny Southern California city of Vernon made frequent headlines this year.

In April, the state Assembly voted in favor of disincorporating the industrial city, which lies just south of downtown Los Angeles. After years of mismanagement and corruption allegations against Vernon’s politicians, Assembly Speaker John Peacute;rez (D–Los Angeles) sought to dissolve Vernon and incorporate it into Los Angeles County by sponsoring Assembly Bill 46, which states that cities with a population of fewer than 150 people should be incorporated into their respective county.

Local businesses and labor unions fought back, stating they could not afford to operate without the many benefits that Vernon provides and that they may have to relocate to other states that offer industrial incentives.

At just over five square miles and possessing a population of roughly 112 people, the town is home to many apparel manufacturers—including James Perse, True Religion, Lucky Brand Jeans and Karen Kane—that benefit from the city’s discounted utilities, taxes and insurance. According to Mark Whitworth, fire chief and city administrator for Vernon, 10 percent to 15 percent of Los Angeles County’s apparel industry is located in Vernon.

After several months of volatile sparring between bill supporters and local businesses, the state Senate voted down AB46 in August, citing concerns over potential job losses in a weak economy, despite the creation of AB781, a companion bill sponsored by Perez to create protective regulations for Vernon businesses if the city were to be dissolved.

“Maybe the outcome was the best possible outcome because it allowed a positive business environment to continue but brought a reality check to the city government of Vernon that things have to change,” Lonnie Kane, president of Karen Kane, said.

Most recently, the city made headlines again with the news that it had agreed to pay $60 million to neighboring communities in order to secure votes against disincorporation.—D.C.

Volcom Acquired by PPR

By now the employees at Volcom Inc. should be able to say “Surf’s up” in French.

In May, French luxury and retail company PPR snapped up Southern California activewear brand Volcom for $607.5 million. The purchase was one of the largest apparel deals done in California in recent years and showed that big corporations still have a healthy appetite for paying big bucks for promising companies. Remember when VF Corp. paid $775 million for 7 For All Mankind jeans in 2007?

The cash deal had PPR paying $24.50 a share for Volcom, a 37 percent premium over the stock’s three-month average trading value.

If PPR—whose brands include Gucci, Alexander McQueen, Balenciaga, Stella McCartney and Yves Saint Laurent—seemed like an unlikely suitor, consider this: In 2007, the French dynamo bought a majority share in Puma, the third-largest athletic brand in the world, after Nike and Adidas.

PPR is trying to beef up its Sport & Lifestyle Group and saw great promise in Volcom, whose revenues in 2010 were $323.2 million. PPR is preparing to take Volcom to the next level, going for wider global distribution and opening new stores.

Some analysts saw the sale as a wise decision by Costa Mesa, Calif.–based Volcom, which makes skateboard, snowboard and surfboard apparel. One of its major retail customers is Pacific Sunwear of California, which has been having a tough time turning a profit. PacSun has lost money during the past four fiscal years.—D.B.

West Hollywood’s Fur Ban

Throughout its 27-year-history, the city of West Hollywood has embraced fashion and politics, and in 2011 the city’s obsessions seemed to be on a collision course.

On Nov. 21, the Southern California municipality became the first American city to pass a ban on the sale of new fur fashions.

The move proved to be a controversial one for a city whose retail mix includes several high-profile designer boutiques, such as Balenciaga and Alberta Ferretti, that sell new fur fashions.

Supporters of the ban, including a majority of the City Council (three council members), voted for the ban Nov. 21, carrying the belief that the law would be the first step in turning society against what they contend to be a barbaric practice—slaughtering animals for fur. The sale of vintage fur and fur used in furniture would still be allowed under the new law. Enforcement of the new ban has not been formally discussed, but it might be treated as a code violation, with citations given to retailers that sell new fur.

The passage of the fur ban made headlines around the world, but it won’t go into effect until September 2013. West Hollywood Mayor John Duran called for an economic-impact study to judge how the ban will affect the city’s fashion retailers.

Trade group Fur Information Council of America, which is headquartered in West Hollywood, will work with the city on the economic-impact study, said Keith Kaplan, executive director for the FICA. Survey findings will be key in an attempt to overturn the ban. The great majority of West Hollywood fashion retailers are against the law, Kaplan said, adding that many will leave the city if the ban goes into effect.

“When that community goes away, what are you left with?” he asked. “It is conceivable that the city will be left with only souvenir shops. It has the potential to be really damaging to the city.”—A.A.