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Full text week 10-2015

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ISSN 1994-2419

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Issue Week 10-2015

 

Summary of news published in Week 09-2014

  jpa4Sibil220REPORTED here this week, the opening of an online store by Swiss underwear label Zimmerli again poses the question of brands competing with their wholesale customers. In this case, the luxury character of the product means that physical stockists are thinly spread, which minimizes but does not exclude possible cannibalization of sales. As regards more affordable brands with broader wholesale distribution, a label’s online store provides a significant level of competition for its wholesale customers, who also resent the higher margins generated by such direct sales. But, considering the expected further growth of online sales of bodywear, it is clear that brands have much to gain from being available online. Consequently, the question is not whether they should have an online store but how their wholesale customers can be protected against loss of income. There are several ways this can be achieved, and all merit close attention to ensure that the most equitable solution is adopted.  

Jean-Pierre Adeline

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BACKGROUND – developments to bear in mind

 

 INFLUENCES: sensuality in lingerie surveyed

UK: online lingerie sales show strong growth

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SUPPLIERS – information from the upstream sector

 

  SUNSELECT: new tan-through fabric offers printing options

DESSEILLES: local press predicts impending failure  

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THE APPAREL SCENE – news of brands and labels

 

  ZIMMERLI: luxury label launches online store

ULTIMO: UK brand opens first store concessions

BJORN BORG: strong performance achieved in 2014

RAJ: New York-based beachwear brand acquired

VAN DE VELDE: sales growth maintained in 2014

SCANDALE: volume distribution secured in France

HANRO: range diversified into outerwear

WACOAL: more affordable line launched in Europe  

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DISTRIBUTION: evolution of chains and channels

 

  F.O.H.: lingerie store network to be slashed

RIGBY & PELLER: first franchise to open in Germany

ESPRIT: first half performance disappointed

MACK WELDON: e-tailer backed by venture capital

UNDER ARMOUR: expansion in Europe to accelerate  

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PEOPLE: corporate personalities

 

  CYNTHIA ERLAND: joins American Apparel

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FINISHING TOUCH – the smile for this week

 

  GOLD DUST: an expensive way to clean home  

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BACKGROUND – developments to bear in mind

 

  INFLUENCES: sensuality in lingerie surveyed

 

UNDER the title Exploring Sensuality, the latest report from bodyfashion consultants Concepts Paris surveys the impact of sensuality on innerwear designs shown at the Paris salons in January 2015. The comprehensive presentation, which is exclusively for subscribers to the consultancy’s services, features nine trend boards with descriptive text and nearly 40 photos of garments illustrating the many different aspects of the theme. CONCEPTS-PExploring-Alert-2

As with other reports from this source, which provides creative information for the most influential innerwear labels throughout the world, the perception of fashion trends provided will have a significant role in defining lingerie looks in the coming seasons.

 

 

UK: online lingerie sales show strong growth

 

NATIONAL trade publication Lingerie Insight reported that, according to the IMRG retail association, online sales of lingerie items in the UK rose by 265 per cent between January 2009 and September 2014. During the same period, online sales of all products showed a rise of 116 per cent. It quoted IMRG Managing Director Justin Opie who said: .

“Not only was lingerie one of the strongest performing categories in 2014, it has also recorded the second-highest overall growth throughout the economic downturn – with only the accessories sector seeing higher growth.

 Moreover, the lingerie sector has actually outperformed growth in the total online retail sector in four out of the past five years.”

Agent Provocateur

Agent Provocateur

Considering the convenience it offers to consumers, it is very probable that online purchasing of lingerie has enjoyed a similar growth also in other countries.

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SUPPLIERS – information from the upstream sector

 

  SUNSELECT: new tan-through fabric offers printing options  

 

FOLLOWING several years of development by Interlad BV, the Netherlands company that operates the Sunselect tan-through fabrics business, a new tan-through fabric is being launched for swimwear and other garments worn next to the skin. Made of 85 per cent special polyester yarn, with 15 per cent Lycra elastane, the fabric can be transfer printed as an alternative to rotary or flat printing. Deliveries start on 1 March 2015 for S/S 2016 collections.

Sunselect

Sunselect

Transfer printing brings considerable flexibility to garment production by making short runs economically viable and because it allows the printing of finished garments. This allows manufacturers to respond faster to changes in demand for print designs.  

 

DESSEILLES: local press predicts impending failure  

 

WITH less than three weeks to run and only 7 per cent of its objective reached, the attempt by Desseilles Laces to crowdfund EUR 200’000 now seems doomed to fail. In the absence of an alternative solution, local newspaper Nord Littoral reported that rumours of the company’s impending failure were widespread among lace professionals in Calais. The article quotes a labour union leader who believes that an acquirer can be found if the company goes into administration and warns that its closure could start a process that would lead to the end of Leavers lace production in the area.

Bi-stretch lace by Desseilles

Bi-stretch lace by Desseilles

With a healthy order book position, but with the need to finance long lead times from design development to payment of invoices, Leavers lace producers need substantial working capital, which banks are reluctant to provide. In the US, bond issues provide an alternative to bank credit but the adoption of such a solution in Europe poses many problems, which are difficult to overcome. This causes many failures that are avoidable in theory.

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THE APPAREL SCENE – news of brands and labels

 

  ZIMMERLI: luxury label launches online store

 

PRESTIGIOUS luxury underwear label Zimmerli opened its first online store, selling its basic and seasonal collections for men and women. The site is in three languages and reaches 52 countries. Zimmerli CEO Marcel Hossli said that the launch reflected the company’s strategic objective to boost international awareness of the label and to broaden its circle of customers while bearing in mind the interests of its retail distributors.

Zimmerli

Zimmerli

While the new store will certainly help to promote wider recognition of the label, it remains to be seen whether it also prompts more customers to make their purchases from Zimmerli retail stockists.

 

ULTIMO: UK brand opens first store concessions

 

THE FIRST department store concession in a Debenhams storeis to be opened this year by UK brand Ultimo. Last year, the label had opened two other concessions in House of Fraser department stores and it announced it would open up to 12 concessions this year in the two department store chains. Ultimo CEO Michelle Mone said that concessions allowed a more effective presentation of the product range, which served consumer interests, and also provided the label with a better control of the selection of products proposed in the store. She added that the concessions opened to date had already proved successful.

Ultimo

Ultimo

Last year, Ms Mone had hinted that Ultimo, which is now partnered by MAS Holdings, was considering expansion into continental Europe. The current emphasis on retail concessions suggests that the brand remains focused on the UK market, but the Sri Lankan partner has the resources finance expansion on both fronts, if it wished to do so.  

 

BJORN BORG: strong performance achieved in 2014  

 

SWEDISH bodywear brand Björn Borg announced 2014 results that showed sales up by 9 per cent to SEK 538.8m and earnings nearly tripled at SEK 47.6m. Retail activities accounted for most of the growth, with sales up by 15 per cent to SEK 92.2m while wholesale sales declined by 14 per cent to SEK 220m. At 31 December 2014, the company operated 41 retail stores, of which 18 were owned outlets. Björn Borg CEO Henrik Bunge said that the company would place greater emphasis on sportswear in the future and would also boost its online sales efforts while strengthening its presence in Northern Europe.

Björn Borg

Björn Borg

Last year, the company suffered setbacks in the Netherlands where it had over-invested but sales potential in Western Europe remains promising.  

 

RAJ: New York-based beachwear brand acquired  

 

US SWIMWEAR specialist Raj Manufacturing LLC said it has acquired New York-based rival swimwear brand Basta Co. LLC for an undisclosed amount. Raj President Alex Bhathal described the deal as a perfect fit into the company’s brand portfolio. He added that it would allow the Basta label to tap into Raj’s distribution channels and market to a larger audience. Raj is an important US manufacturer, with annual sales of around USD 130m.

Hurley Swimwear by Raj Manufacturing

Hurley Swimwear by Raj Manufacturing

The acquisition broadens yet again the brand portfolio of Raj, which already included several widely distributed swimwear labels.  

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VAN DE VELDE: sales growth maintained in 2014

 

LUXURY lingerie manufacturer Van de Velde published audited annual results for 2014 that showed sales up by 8.7 per cent, to EUR 198.4m, as wholesale sales rose by 9.6 per cent and despite the continuing decline of sales by the Intimacy retail chain in the US. Retail sales in continental Europe rose by 20.3 per cent while sales of Rigby & Peller stores in the UK were 6.8 per cent higher. As a result, REBITDA rose by 18.6 per cent to EUR 57.7m. Looking to the future, the order book position promises a further increase in wholesale sales in the first half of 2015. Earlier, it had been announced that the group’s Spanish operation, under the Andrés Sardá label, had launched an online store currently available to consumers in Spain and France, but with an English version targeting the US market.

Andres Sarda by Van de Velde

Andres Sarda by Van de Velde

The progress made in 2014, despite continuing problems with retailing in the US, is a tribute to the creative and management strengths of the company.  

 

SCANDALE: volume distribution secured in France  

 

FOLLOWING the announcement of its introduction at low prices into Target stores in the US, the Scandale lingerie label, which is owned jointly by Hop Lun and actress Halle Berry, said that it would be sold in France through the Carrefour supermarket chain. A first limited collection of around 12 pieces at an average price of EUR 38 is to be proposed by 112 stores of the French chain starting on 17 March. As from July 2015, the full collection will have a permanent presence in the French supermarkets.

Scandale

Scandale

The average price being charged in France is more in keeping with the traditional image of the label than the rock-bottom prices applied in the US, some of which are already being discounted only weeks after the launch.

 

HANRO: range diversified into outerwear

 

SWISS underwear label Hanro, which has been test marketing since 2013 a line of knitted outerwear under the Hanro Knit label, is to re-launch a more comprehensive collection titled Eric & Me by Hanro that was discontinued in the ’80s. The collection of 43 pieces includes both knitted and woven garments and is making its debut for A/W 2015/16. It is positioned well upmarket, with prices ranging from EUR 120 to EUR 500. It is to be distributed through Hanro stores, department stores and multi-brand independents around the world but with special emphasis on German-speaking countries.

Eric & Me by Hanro

Eric & Me by Hanro

The outerwear collection will raise the visibility of the label, which could well boost sales of the underwear range.  

 

WACOAL: more affordable line launched in Europe  

 

LAUNCHED in the US in 2009 under the B.Tempt’d label, a more affordable lingerie line from Wacoal is being introduced into the EU after very limited test marketing in the UK, Germany, Netherlands and Eire. Some elements of design have been modified but the essential characteristics of the collection remain: colours, fancy prints and wearable styles, pepped up by a few more sexy creations, all intended to generate impulse purchases.

B.Tempt'd by Wacoal

B.Tempt’d by Wacoal

The B.Tempt’d collection complements the labels of the Eveden group, that was acquired by Wacoal in 2012, to provide a broader range of price points.

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DISTRIBUTION – evolution of chains and channels

 

  F.O.H.: lingerie store network to be slashed

 

TROUBLED US distributor of erotic lingerie Frederick’s of Hollywood (F.O.H.) said that it was preparing to close at least 31 of its 93 stores, including its Hollywood flagship, which is to close in April. The Wall Street Journal reported that the chain has retained Great American Group to help wind down operations of around one third of the chain’s stores. It also quoted F.O.H. CEO Bill Soncini saying: “We’re in the process of re-engineering the whole business. Landlords have been very, very agreeable of letting us out of some very unprofitable locations that should have been closed years ago”.

Frederick's of Hollywood

Frederick’s of Hollywood

Together with the loss of glamour suffered by Hollywood with the passing of the studio system, a late and largely ineffective response to the rise and expansion of Victoria’s Secret has made life increasingly difficult for F.O.H.  

 

RIGBY & PELLER: first franchise to open in Germany  

 

THE FIRST franchised store of the Rigby & Peller chain in Germany is due to open in Krefeld on 16 March. It complements the existing eight owned stores of the British chain there, which is part of the retail operationsof manufacturer Van de Velde. There are plans to open five, and possibly six, new franchised Rigby & Peller stores in the country before the end of 2015.

Rigby & Peller

Rigby & Peller

The existing stores in Germany were rebranded boutiques that formerly traded under another name, which makes the franchise a genuine new opening.  

 

ESPRIT: first half performance disappointed  

 

A SALES decline of 13.2 per cent, to HKD 10.7bn slashed earnings of Esprit by 30 per cent, to HKD 47m, in the first half of its 2014/15 fiscal year. The poor performance is attributed partly to unseasonably warm autumn weather that reduced footfall in the chain’s stores and partly to the continued closure of under-performing points of sale. Retail sales declined by 8.5 per cent in like-for-like terms, to HKD 6.7bn, and wholesale operations slumped by 14.3 per cent to HKD 3.9bn.

Esprit

Esprit

Once a star performer, the chain has not yet found a solution to the problems that have marked its evolution in recent years.  

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MACK WELDON: e-tailer backed by venture capital  

 

THE ONLINE store created in the US to distribute anti-odour underwear under the Mack Weldon label won USD 4m backing from three venture capital firms. The company, whose products feature silver yarn blended with cotton and elastane, said that it has 50’000 repeat customers. It plans to use the cash to boost sales, innovate and expand marketing, possibly through third party partnerships and collaborations.

Mack Weldon

Mack Weldon

The brand’s success in attracting venture capital suggests that US demand for the anti-odour performance provided by silver yarn is expected to show considerable growth.  

 

UNDER ARMOUR: expansion in Europe to accelerate  

 

FUNCTIONAL underwear specialists Under Armour revealed plans to open flagship stores in seven major European cities by the end of 2016. The chain that launched its first European online store in Germany last year cited London, Paris, Berlin, Munich, Amsterdam, Madrid and Barcelona as locations for the new stores. These stores will feature the dynamic new concept applied to recent US openings in Boston and Chicago. The chain also plans to intensify its wholesale operations in Europe. Last year, the brand raised its world sales by 32 per cent, to over USD 3bn, and its earnings were up by 6.7 per cent to USD 208m.

Under Armour

Under Armour

Now that it has grown into the same league as major international labels such as Nike or Adidas, Under Armour is going all out to move into the top spot.

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PEOPLE – corporate personalities

 

  CYNTHIA ERLAND: joins American Apparel  

 

MADE in America specialist clothing manufacturer and retailer American Apparel announced the appointment of Cynthia Erland as its Senior VP of Marketing. Ms Erland brings with her over 20 years experience of fashion marketing and brand building, most recently with Perry Ellis International.  

Cynthia Erland

Cynthia Erland

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FINISHING TOUCH – the smile for this week

 

  GOLD DUST: an expensive way to clean home  

 

OPERATING under the name Dirty Business, a company in Canada offers house-cleaning by women wearing lingerie. The service is priced at CAD 100 per hour for a minimum of two hours and users are warned that it is strictly limited to house cleaning, with no extras available. According to Huffington Post, that reported on the service, cleaning women always work in pairs, with a bodyguard to ensure security, which boosts total cost to CAD 400. Unsurprisingly, most users are said to be young, unmarried men. dirty-business220 Cost-conscious regular users might well conclude that marriage is a more economically acceptable option, provided they can find a spouse who is prepared to get undressed before doing the housework.

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