California Apparel News

Rosenthal & Rosenthal Inc. already had a growing clientele list on the West Coast when the New York–based factor made the commitment to open a full-service office in California in 2003.

This year, Rosenthal & Rosenthal is celebrating its 75th year in business—and its 10th on the West Coast.

“This is a big year for Rosenthal,” said Harry Friedman, Rosenthal executive vice president. “It’s the 10th anniversary of having our boots on the ground in California.”

Friedman had been working in California’s finance industry for 25 years when he joined Rosenthal family member and Principal and Executive Vice President Kenneth Kleiner in opening Rosenthal’s West Coast office, located in the San Fernando Valley community of Woodland Hills.

“While we had clients out here [before opening the California office], they were handled back East,” Friedman said. “When we opened out here it became full steam.”

Friedman oversees a staff of six, including Senior Vice President Sydnee Breuer, who heads up new-business development, and Senior Vice President and Portfolio Manager Jeff Enoch, who handles client credit. It’s a lean operation, supported by the 250 staffers working in Rosenthal & Rosenthal’s main office in New York.

Founded in 1938, Rosenthal & Rosenthal has a rich history tied to the garment industry. Founder Imre Rosenthal began lending money to apparel makers who put up their receivables, merchandise and equipment as collateral. Over the years, the company expanded into other industries, but today, apparel remains at the core of the business, which provides financing ranging from $500,000 deals up to $30 million. About
80 percent of the company’s finance activity is factoring, with the balance asset-based lending.

“We have a full-service office, where application decisions are made on-site, where account executives are conducting in-depth loan administration, client relationships, and the nexus of factoring and lending,” Friedman said in a company statement. “We are able to quickly respond to seasonal over-advance requests, working-capital fluctuations, credit analysis on client loans, and resolution of client problems and issues.”

A decade on the West Coast “demonstrates our permanent allegiance to this marketplace,” said Kleiner in a statement.

Rosenthal’s West Coast business has grown every year since the office opened, Friedman said. Clients range from small businesses to mid-tier to “very large clients with $400 million or $500 million in sales,” Friedman said. “We do it all.”

Breuer, who joined the company “a little more than three years ago,” said the company is seeing the return of new start-ups, although not at the pace of the pre-recession years.

“It’s more than we’ve seen in the last two years, but it’s nowhere what we saw five or six years ago,” she said. “We’re also seeing some growth from companies that launched three to five years ago. They’re starting to get traction.”

Although Friedman acknowledged apparel makers are likely to face a flat economy in 2013, manufacturers who control their inventory and operating expenses are well-positioned.

Growth areas in the coming year include e-commerce and international sales, he added.

“I think what everyone is waiting for is retailers to start building inventory,” Friedman said. “When they’re willing to stock a little more, that will be the true sign of things changing.”

But, Breuer added, the industry is unlikely to return to the high inventory levels of the past.

“Just-in-time inventory is the necessary way to do business,” she said.

—Alison A. Nieder