women’s fashion

Posted by Paul Brindley
on September 28, 2021

Trade Shows in the Time of COVID

Jumbo screen at new LVCC West Hall

Jumbo screen at new LVCC West Hall

This is my first fashion blog since 2019. Why? The pandemic isn’t completely to blame though it’s been difficult to think of anything else of such note to write about in the industry since the shutters went up last March. Relying on the brevity and immediacy of Instagram to share my trade show and industry trawlings since then has reduced the motivation and necessity of investing the time and effort required to produce any long form reporting. But the itch is back. So here we go.

The west coast contemporary fashion trade show circuit spun back to life in June for the Los Angeles Market Week, the same place is wound down after the March 2020 edition just managed to sneak in prior to the March 19 statewide COVID shutdown. Understandably, it was a sedate few days given the reticence of some buyers to return to fray with the pandemic still front and center and the fact that the popular booth showcases by Brand Assembly and Designers & Agents were missing but it was encouraging to see the wheels turning again.

Unfortunately for west coast retailers, the Swim and Active Collective canceled their July show in Huntington Beach due to pandemic concerns of vendors and buyers. However, apart from the Kingpins denim show in New York in October canceling their in-person iteration in favor of a virtual showcase, the Swim and Active Collective shows are the only in-person trade shows to no go ahead because of the pandemic in the second half of this year so far.

Attentions turned to the July swim shows in Miami before August delivered a full slate of South California and Las Vegas shows:

  • OC Apparel Show – August 4-6 at the Embassy Suites, Irvine
  • Liberty West and LA Men’s Market – August 4-5 at the California Market Center
  • MAGIC/Project – August 9-11 at the Las Vegas Convention Center, both new and old.
  • Agenda – August 11-12 at Bally’s Las Vegas
  • CALA Men’s Trend Show –  August 15-17 at the Newport Beach Marriott
  • CALA Newport Beach  – August 19-20 at the Newport Beach Marriott
  • Curve Los Angeles – August 23-24 at the Westdrift Manhattan Beach
  • SoCal Fashion Exhibitors  – August 29-30 at the Embassy Suites, Irvine

    The silky Mantl men’s skin range at OC Apparel Show

OC Apparel Show is a new hotel room based showcase that is building a solid following of brands and buyers. August was the second go-around and, given the timing being just prior to the Vegas shows, it held its own in activity from the launch show in May of this year. If the October version shows growth, It will vindicate the efforts and enthusiasm of Jim Iwasaki, the showrunner and industry veteran, in bringing physical touch back to the buying process after the dislocation of the pandemic and more broadly and sustainably to provide the retailers of Orange County a regular and local wholesale resource.

Check out the brand mix here.

Leaving a large hole in the subsequent Vegas show round, Liberty Fairs decided to partner with LA Men’s Market as Liberty West for a joint show the week prior to Vegas on the tenth floor space of the revamped and revamping California Market Center.

Wood Wood at LA Men’s Market

Why? Rivet reported the following:

The partnership began virtually. To make up for the lack of physical events in the last year, Liberty Fairs teamed with wholesale platform Joor to launch its first virtual marketplace, where it worked closely with the L.A. Men’s Market.

“After collaborating with L.A. Men’s Market, it was evident that we needed to join forces and service our fashion community in a meaningful way,” said Edwina Kulego, vice president of Liberty Fairs.

While this marks Liberty’s first time in L.A., Kulego says the locale has always been on its radar. “The city is an undeniable hub of fashion and creativity,” she said. “We have an incredible community of brands and retailers based in L.A., and we are excited to bring Liberty Fairs to a new destination. Our main priority is to execute a safe show that continues to foster commerce, connections and community.”

Moving forward, she added that Liberty will offer a mix of online and offline options to cater to the fashion industry.

Though typically held twice a year in New York City and Las Vegas, Liberty Fairs is experimenting with new locations and collaborators.

The show had the usual high quality mix of contemporary and better contemporary dual gender apparel and accessories brands that both showcases are known for. The show producers must have been delighted with the energy and activity.

MAGIC/Project was a very different affair from anything seen in my previous twenty-one years of attending. The shows were housed at the expanded Las Vegas Convention Center complex. The existing halls are connected to the new West Hall located across Paradise Road by The Las Vegas Convention Center Loop, the underground tunnel developed by Elon Musk’s The Boring Company to shuttle convention attendees throughout the 200-acre campus in all-electric Tesla vehicles.

Masks required at Project

The shows were much smaller and more lightly attended than usual, which was expected but still incongruous to the long time participant. Due to skyrocketing Delta variant infections, masks were required and policed which was comforting. Trish Concannon, Buyer Relations Specialist with the show producer, Informa Markets Fashion was very pleased with buyer turnout and vendor satisfaction despite the dampening effect of the variant surge.

Ben De Luca at Peter Grimm booth

Ben De Luca at Peter Grimm booth

Good friend and headwear impresario, Ben De Luca who is now with hat maker, Peter Grimm, was very happy with the activity at Project in the Central Hall.

As was Brian Stark of leading men’s showroom, Brand Equity. Brian is doing great business, has maintained his retailer base despite the pandemic and continues to operate showrooms in NY and LA in a time when showrooms are closing and more and more agents are working from home.

Over at the West Hall, Shannon Kane of LK Showroom was working the Another Love booth and was very pleased with sales. LK Showroom is another agency reporting strong selling and retention of retailer base despite the pandemic.

OFFPRICE was in the South Hall where picked up some crystal mala necklaces and bracelets for my good friend Nancy’s metaphysical and spiritual gift store in Long Beach CA, Z Fabrique.

The massive FN Platform shoe show did not happen. I think it now runs on a different schedule.

BN3TH Underwear at CALA Men’s Trend Show

The inaugural CALA Men’s Trend Show at the Newport Beach Marriott was a big success. Ken Haruta who ran the menswear West Coast Trend Show at the Embassy Suites at LAX for years partnered with the CALA show producers allowing him to broaden out of the hotel suite format into a booth showcase that took up multiple ballroom and meeting rooms. Ken told me that his vendors had been requesting an expansion and reformatting of the show. The opportunity to collaborate with CALA made synergistic and economic sense.

The show offers buyers the chance to shop traditional men’s, contemporary and better contemporary brands. The show is moving for it’s next edition in January, as Ken told Apparel News:

“This has been a great environment for our show,” Haruta said. “We are moving to a property called The Hangar. Our dates are set for the last week of January. It’s going to be a 50,000-square-foot lease for us. It’s going to be 25,000 square feet for men and 25,000 square feet for women.”

Some of my favorite brands were in attendance including Robert Graham and BN3TH Underwear. Michael Loughlin, US Key Account Manager with BN3TH walked me through the expanded offerings emphasizing their commitment to sustainability and their goal of going carbon neutral. Having followed and worn BN3TH since their launch as MyPakage, it is heartening to see this quality brand survive and thrive.

Love Apparel at So Cal Exhibitors

The brand new CALA Newport Beach women’s and So Cal Fashion Exhibitors shows and the second Curve Los Angeles swimwear show were all limited in exhibitors and lightly attended by buyers. This may be due as much with their infancy as the continued pandemic. I think CALA and Curve have legs and will establish over time. So Cal Fashion Exhibitors, which at time of writing still does not have a website, might struggle to survive due to the similarity of its customer, location and timing with CALA.

Industry vet Ginger Vasquez of Ginger Showroom was happy with activity at CALA. She has been very busy in general since the reopening of retail last year and lost very few customers to the pandemic with a few older store owners opting out during the 2020 shutdown. As for her fellow agents, she sees lots of vacancies in the wholesale buildings in downtown LA as many independents have decided to work from home rather than carry the costs of a standing showroom.

For years now, I have advocated the eventual demise of the trade show circuit due to the ever increasing ability to effectively reach and interact with end users by way of online platforms and imaging technology including AR and VR. In short, despite the tactile nature of the apparel buying process, I believed that we would tech our way out of the need for physical trade shows and all the cost, effort, waste and carbon footprint involved. 

I may have been a bit previous. The response to online trade shows during the height of the pandemic was lukewarm at best. It has been obvious since the return of in-person events that buyers not only need to touch the goods they want to buy but that the social and interactive aspect of the process is ingrained and enjoyed. In-person apparel trade shows are here to stay.

Paul Brindley
Founder & Principal Adviser

 

Posted by Paul Brindley
on January 12, 2017

REVIEW: Agenda Long Beach Trade Show, January 5-6, 2017

The view from the JanSport lounge at Agenda Long Beach

The view from the JanSport lounge at Agenda Long Beach

Before you could say “2017?”, Agenda Long Beach got the apparel trade show year off to a cracking start last Thursday at the conveniently close Long Beach Convention Center.

I will not rehash the whys and wherefores of Agenda. I have covered the development and expansion of the show in my twice yearly reviews since 2011. You can read the previous reviews here.

The rain (yes, rain in Southern California) did not stop the first day being well attended and energetic. There was nothing new in the general layout of the show. The Berrics (skate), Enclave (street and men’s contemporary) and Footwear sections to the left. The Point (surf), The Woods (contemporary and lifestyle apparel and accessories), Pin & Patch (personalized accessories), The Essentials (grooming and personal goods), WMNS (women’s contemporary apparel and accessories), Resource (industry providers) to the right.

The one marked difference from previous shows was the very noticeable drop-off in foot traffic and activity on Day 2. For consistency of comparison, I prefer to walk the show at about the same time both days, usually during the busiest times of late morning to early-mid afternoon. Being only a two day show, both days are usually bustling. The weather was no worse on Friday, in fact a little better. It may have been an anomaly.

The brands and booths that caught my eye were:

Pray for the edgy streetwear of Ignored Prayers

Pray for the edgy streetwear of Ignored Prayers

Ignored Prayers leveraged this display for some brand awareness in the Enclave section. The edgy streetwear is only available on their website at Supreme and Union.

 

San Pedro's own Ascot

San Pedro’s own Ascot

San Pedro label Ascot was showing high quality, locally made caps along side Bates leather jackets. Ascot also does tees and sweats.

 

Sevag Kazanci, co-founder of Parks Project

I first met Sevag Kazanci, the co-founder of Parks Project when he spoke on a panel at one of the Molina Entrepreneurship Series events last year. Parks Project holds the license to produce apparel for the US National Park Service. They are currently servicing gift stores in 28 national parks with a 10 year goals of supplying 100 parks.

These are not your typical gift store tees, caps, sweats and beanies. The graphics, fabrics and styling compare very favorably to anything you can buy in a contemporary boutique. They are selling in boutiques in Japan. I will be investigating the Australian market for them.

By the way, the top 3 selling parks’ apparel? #1 – Joshua Tree, #2 – Yosemite, #3 – Muir Woods.

 

JanSport Diamond collection

JanSport Diamond collection

Over the past few years, I have been tracking the expansion of the range of JanSport backpacks, bags and accessories. JanSport has been an old fav of mine for years. Growing up, they were the first brand of backpacks I was aware of (that is after the army surplus backpacks that were hip in the late 70’s).

JanSport has been around since 1967 with functional, outdoor gear that is well priced and durable. Over recent seasons, they have been stepping up their design, styling and fabrics into the lifestyle and contemporary segments. The Wayward Collection has done very well. They have just introduced the resort-inspired Diamond Collection and camouflage influenced Ranger Collection. Neither are as yet available on their website.

 

Noral Collections - Made in LA

Noral Collections – Made in LA

Noral Collections specializes in high quality crystal and gemstone bracelets, rings, necklaces and key rings, all handmade in LA. The workmanship is first rate. The price points are very reasonable.

 

Tiger Mist from Melbourne

Tiger Mist from Melbourne

I caught up with Yvette Collis, the livewire Brand Manager of Melbourne’s own, Tiger Mist.

I first met Yvette and the owners of the label, Stevie and Alana Pallister at PoolTradeShow in 2013. Yvette has continued to successfully sell the range directly to US retailers without using a US distributor or agent by targeting the right trade shows in the US and working directly with buyers. The brand is doing very well for Nasty Gals, Revolve, Dolls Kill and is Forever 21’s #1 selling branded label.

Online sales have continued to grow strongly on the back of a successful social media campaign focused on Instagram and Snapchat.

 

Olyss sweaters out of New York at Joken Style Showroom

Olyss sweaters out of New York at Joken Style Showroom

Joken Style Showroom had a very solid Day 1 meeting with TJ Maxx, Quiksilver and small local boutiques, including Topaz Sun from Manhattan Beach, New Jack City in Huntington Beach and Long Beach’s Prism Boutique.

paul brindley consults recently brokered a national sales representation deal between Joken Style and the popular Australian bag collection, The Redletter Club. RLC will be launching in the US in the Joken Style showroom at next week’s Los Angeles Market Week.

 

Respected heritage label, Kennington

Respected heritage label, Kennington

As usual at Agenda, I stopped by Kennington. Not many brands can say that they have been in business for 60 years. Kennington is one of those rare few. I was very impressed with the look of the prints and colors.

I will be working with Kennington to secure an Australian distribution deal for the coming Spring/Summer 2017 season.

Where to from here?

Next week is Los Angeles Market Week. Next month are the Las Vegas trade shows for Fall/Winter 2017. Between now and Vegas, we will have a new president and a new administration with a Republican majority in Congress.

I think we can all remember the consequences of the last Republican political straight flush. We very nearly lost the economy completely.

Over the coming weeks, it will be very interesting to see and hear how the industry reacts to our new circumstances. The second half of 2016 was very encouraging. Lets see if the rhetoric of the campaign starts to become reality. I have a feeling it might trump whatever gains we have made.

Paul Brindley
Founder & Principal Adviser
paul brindley consults

 

Posted by Paul Brindley
on July 06, 2016

REVIEW: Agenda Long Beach Trade Show, June 29-30, 2016

It was all systems go at the unofficial launch of the Spring 2017 season round of apparel trade shows last Wednesday and Agenda Long Beach, June 2016Thursday with Agenda Long Beach at the Long Beach Convention Center.

The busiest period of the fashion week and trade show year will continue through the end of October with major stops in Miami, Las Vegas, New York and Los Angeles.

The original street, skate and surf focus of Agenda has expanded and diversified steadily over the past 5 years to include contemporary and progressive men’s and women’s brands in Agenda WMNS and The Woods sections, personalized accessories in Pin & Patch, grooming and personal items in The Essentials, and industry service providers in Agenda Resource. Read more about each section here.

The broadening mix of brands at Agenda brings together industry veterans, today’s apparel movers and shakers, buyers of all stripes, sales agents from across the spectrum, millennials chugging beers at 10AM, and kids on skateboards. It is a fascinating cross section of the industry. There are bodies in constant motion in every direction to the accompaniment of chatter and laughter, DJ-ed beats, and the clatter and scrape of skateboards. The bars and food trucks inside are never short of customers.

The sights and sounds create a frenetic energy that gives Agenda Long Beach a party feel. But there is still plenty of business done. Most of the brands and sales agents that I spoke to were very happy with the amount and quality of the buyers seen.

Some eyecatchers for me were:

The famous LA heritage brand, Kennington

The famous LA heritage brand, Kennington

Kennington has been doing it right for 60 years. They sport their famous prints and colors in a contemporary, slim fit body for their younger customer and their time tested regular fit in long and short sleeves. I particularly like the Flume Short in three colors and the jackets in three bodies – Bomber, Garage and Safari – that they are doing for Spring 2017.

 

Gypsies & Debutantes at Joken Style booth

Gypsies & Debutantes at Joken Style booth

Eme Mizioch of Joken Style Showroom was super excited by the response to Gypsies & Debutantes‘ bags. The bags are beautifully constructed with paneling made from re-purposed traditional women’s blouses from South America. They had seen buyers from Diane’s Beachwear, Fab Fit Fun and Crossroads.

 

Giving Bracelets benefits Court Appointed Special Advocates (CASA) for Children

Giving Bracelets benefits Court Appointed Special Advocates (CASA) for Children

The soft leather, metal and electro-plated crystal adjustable bracelets and necklaces from Giving Bracelets are unisex, comfortable and empowering to wear (I haven’t taken mine off). 10% of the proceeds go to support Giving Bracelets benefits Court Appointed Special Advocates (CASA) for Children. Wholesale prices start at $13.50 with no minimums.

 

The Wayward Collection by JanSport catching the higher end, natural look

The Wayward Collection by JanSport catching the higher end, natural look

I was impressed by the new Wayward Collection from JanSport. JanSport has captured a natural eco-look with subtle colors and prints to appeal to the higher end of the market.

They were two very strong days at Agenda. The activity bodes well for the upcoming wholesale selling season. I am looking forward to the reports from shows in New York and Miami in July. I will be blogging from Las Vegas in August. I am expecting Vegas to be the strongest show since the 2008 financial crisis.

Paul Brindley
paul brindley consults

Posted by Paul Brindley
on May 26, 2016

It’s the End of the Department Store as We Know It? It Better Be

When was the last time you shopped for clothes or accessories at a department store? And when I say department store, I mean nothing short of a Macy’s. Let’s not count the popular secondary department stores like Marshalls or Ross or the department stores’ own secondaries like Nordstrom Rack, Macy’s Backstage and Saks Fifth Avenue OFF 5th.

If or when you did last grace the departments, did you linger and walk the floors like the good old days? Or was it a smash and grab raid like you were shopping online? Could you live without department stores in your shopping life? After all, you have never had more buying options for apparel or just about anything for that matter.

I ask these questions because you may have to consider life with fewer or even (well down the road, if ever) no department stores. The business press has been reporting the on the struggles of the US department stores for some time now. Recent poor financial results have increased the pressure on some big names.

The Business of Fashion just posted an excellent article on the subject, Why American 1-macys-genista-flickr-cc_650Department Stores Are ‘Broken’Macy’s saw a 5.6% drop in year on year sales for the first fiscal quarter of 2016; Saks Fifth Avenue was down 5.7 percent, and the usually invulnerable Nordstrom dipped 1.7%.

Why are they broken?

  • Retail in general is struggling despite all the usual economic parameters for strong retail sales currently set in ‘Go’ mode. The Business of Fashion outlines the reasons in another excellent article, “Why Aren’t Americans Shopping“. I couldn’t put it any better, so I won’t except to say that we live in a very different retail world post the 2008 Great Recession (aka “The GFC” or “The Global Financial Crisis”, as it is known elsewhere).
  • Department stores haven’t changed they way they do business in practice or look and feel for years. Walk into any department store today and it looks like it did 20 years ago. Just buying up the next popular online site or simply posting more content on social media or having sales staff working off iPads and or jazzing up your advertising will not cut it in this millennial world. Its all about customer engagement. Even the edgiest marketers are still figuring out how to effectively influence millennials. I do like “The 5 Ways to Sell to Millenials” on Inc.com:

1.  Authenticity matters most

2. Realize you’ll be fact-checked–almost before you finish.

3. Make your point, and then shut up.

4. Make your message an emotional story.

5. TV? What’s TV?

Department stores are way behind the game.

  • I heard an industry type on NPR last week state that many in the department store upper echelons have been in the system for their whole careers and that they may little or no feel for the new world of retailing. I’m not sure about this take. Surely someone involved in the running of a premium department store like Saks or Nordstrom or Bloomingdales is staying abreast of all the selling, promotional and demographic trends and needs. If not, then there will be some hefty pink slips making the rounds.
  • Competition is fierce, very fierce. Marshalls and Ross are as busy as ever with both recording healthy increases of year on year sales for Q1 2016. We all know that traditional bricks and mortar apparel retailers have been losing business to the online sellers for a long time now. The scope and pace of the e-commerce effect is broadening and quickening daily. But its now not only the Amazons of this new brave new world that are throwing shade. Retailers now need to contend with popular re-commerce sites like thredUP which are essentially online thrift stores that allow you return good for free within a certain amount of days, and fashion share sites like Rent the Runway where you can rent clothes and send them back.

Where to from here for the premium department store chains?

I think we will see a significant physical and influential downsizing of the department store presence in the market while they attempt to polish their customer engagement by returning to what set department stores apart years ago – the destination shopping experience.

The department store experience should include:

  • good quality restaurants and coffee shops pitched to the spending power of their demographic. E.g. Macy’s would have a cafeteria, Nordstrom would have something more upmarket. I would give them a mid-century modern look to hark back to the 50’s movies where people often seemed to be eating and drinking at the department store before or after a spot of shopping.
  • personal shoppers, spa services, and parties for regular customers
  • pop-up shops spotlighting new, innovative products.
  • more store-in-stores run by the brands themselves along the European department store model.
  • friendly and attentive sales staff
  • easy and efficient return policies
  • more bounce and pep to the look and feel of the stores. They should get ultra modern or mid century or something out of the ordinary.
  • and most importantly when it comes to apparel, more focus on the products that people are wearing now and not what they will be wearing in 3 months. I agree with the Business of Fashion piece that calls for enough of “the “early” retail deliveries, which are increasingly out of sync with the physical seasons and result in markdowns during what should be peak selling periods, hurting full-price sales potential. “As it stands, Pre-Fall clothes are delivered from April through July, while Autumn/Winter clothes are delivered from July through October,” BoF reported in March. “Heavier items like outerwear and knits are often deeply discounted in January when cold weather finally hits.” 

I am sure it seems inconceivable to many that we could exist in a retail environment without department stores. They have been the big fish of the retail world for 150 years.

Fortune.com ran an article in January titled ominously, How American Department Stores Are Fighting Extinction. They concurred with many of the points that I suggested above.

Do I think a mass extinction is imminent? No. But things are going to have to change and change quickly. Department stores better figure out how stay connected and relevant or they will be left way behind in this ever evolving, ever accelerating retail environment and may not catch up.

Paul Brindley
Principal Adviser
paul brindley consults

Posted by Paul Brindley
on March 25, 2016

REVIEW: LA Fashion Market Week Fall16, March 14-17, 2016

9th St & Los Angeles - the epicenter of LA contemporary apparel wholesale

Where it all happens

Last Tuesday saw me strolling down Los Angeles Street in the downtown Los Angeles Fashion District heading for the Fall 2016 Los Angeles Fashion Market Week.

What is Market Week? Its a four day affair of seasonal wholesale buying in the showrooms and trade shows of the main wholesale centers: the California Market Center, the New Mart, the Cooper Design Space, and other venues in the Fashion District.

Five times a year, US and international wholesale buyers roam the showrooms and booth shows determined to stay within their budgets as they buy what’s hot, pass on what’s not, and perhaps gamble on what’s next.  Most buyers who want to stay in business or keep their jobs have a good idea what is working for their customers, and what to take a punt on to freshen up their floors.

By the time I get to the crossroads of contemporary apparel wholesaling at Los Angeles and 9th, I can usually tell how the day is progressing. The telltale signs are everywhere. What is the foot traffic like on the sidewalks and filing in and out of the buildings? How many people are sitting in the cafes? How many are waiting at the traffic signals to get across to the adjacent buildings? How full are the parking lots?

First impressions were that this was going to be the average Fall market week that it turned out to be. You can muse over the full California Apparel News review of the week.

Fall market week in LA is the second busiest behind the October Spring edition. Despite Los Angeles having the largest apparel infrastructure and being the second largest city and metro area in the US, the LA market week is not as consequential as you would think. By the time buyers have been to the massive Las Vegas trade shows and the marquee New York showcases, LA is left to mainly service west coast and some international buyers.

Last week, I focused my time on walking the temporary booth trade shows – Brand Assembly in the Cooper Design Space, Designers and Agents in the New Mart, and the accessories showcase Coeur and the activewear and lifestyle grouping ALT in the California Market Center.

Brand Assembly Emerging Designers Showcase - - paul brindley consults

Brand Assembly Emerging Designers Showcase

Brand Assembly has expanded to 125 brands and now takes up the entire bright, white 13th floor event space of the Cooper Design Space. The carefully curated premier contemporary women’s showcase, “gathers designers with similar price points while avoiding direct brand competition”, as it was explained to me by co-founder, Hilary France. There is a well written profile of Hilary on Fashionista.com.

“Due to exhibitor demand, we could be much bigger but we are committed to a selective, curated approach that optimizes the Brand Assembly experience for our brands and buyers”, professed the other co-founder, Alex Repola.

We Are Kindred - paul brindley consults

We Are Kindred from one of my favorites cities, Sydney at the busy SYDNY showroom booth

I was delighted to see We Are Kindred hanging beautifully in the busy The SYNDY Showroom booth. I introduced the label to The SYDNY. The SYDNY does an excellent job representing Australian designers and brands in the US market.

Brand Assembly was by far the busiest space of the week. Maybe buyers are taking the advice of one of the exhibitor brands, Monrow who have declared that “Brand Assembly Los Angeles is an incredibly well-curated assortment of brands & categories. If I was a boutique, I would only shop there.”

The advanced contemporary Designers and Agents on the 3rd floor event space at the New Mart was close to full but a bit light on buyer traffic when I was there. D&A is known as an independent, international show that attracts brands from the US, Europe and Japan. D&A New York is a much larger, busier show.

Ben De Luca of Brooklyn Hat Company told me he had a busy Monday but Tuesday was slower.

Brooklyn Hat Co - paul brindley consults

Brooklyn Hat Co felts selling strongly for Fall16

Coeur and ALT were stranded on the buyer desert that is the huge penthouse event space of the California Market Center. It was very quiet up there. The penthouse space is only ever full for the LA Textile Show. The space is massive which tends to diffuse whatever energy is created. I think they should switch the smaller showcases to the more cozy and attractive 10th floor, 10B Loft. 10B Loft is about a third the size of the Penthouse and would create a significantly more intimate setting.

Coeur has suffered over the past two or three seasons from a lack of a permanent home (it was at the Alexandria Hotel last season) and most significantly from no longer sharing the 13th floor space with Brand Assembly. Coeur’s accessories and Brand Assembly contemporary apparel complimented each other nicely and fed buyers from one to the other. Coeur was squeezed out by Brand Assembly’s expansion.

The only eye catcher for me at Coeur was Mansi Shah, the namesake brand of New York artist, you guessed it, Mansi Shah. The print focused accessories and caps fuse the subtly innovative prints with a clean, hip mix of color and style, and are well priced.

Mansi Shah from New York

Mansi Shah from New York

We are told that the economy is doing better. The unemployment rate is down and there is even talk that there is sustainable wages growth on the horizon. Retail should be doing significantly better. But it isn’t. The Census Bureau’s Advance Retail Sales Report released March 15 reported that seasonally adjusted sales in February contracted month-over-month with January revised downward.

Continued softness in the retail sector is naturally reaching back to the wholesale market. I am hearing that business at the Fall16 trade shows has been choppy. In my February article, US Economy in 2016 – Steady As She Goes?, I detailed the reasons why I thought 2016 would be a steady year. I still think that a year with some positive momentum is how we will look back on 2016.

It is four months until the swimwear and resort trade shows in Miami and five months until the breaking of Spring17 collections in Las Vegas. I am looking forward to seeing where we are at as an industry should our current slow but steady economic momentum continue or even pick up.

Paul Brindley
Principal Adviser
paul brindley consults

Posted by pbc_admin
on February 05, 2016

US Economy in 2016 – Steady As She Goes?

About this time last year, I wrote an article cautioning against the then prevailing over-optimistic posture of most of the financial and apparel industry press that 2015 was going to be the bumper year leading us all to prosperity.

You can read here: https://usplustrading.com/full-steam-ahead-us-economy-2015-just-hold-horses/

The broad insistence of the enthusiasm was alarming. The fundamentals of the US economy didn’t jibe with the predicted boom. Jobs growth was slow and of questionable quality, wages growth non-existent, consumer confidence was lagging, the financial market was manic depressive. Where was this supposed surge going to come from? How was it going to be paid for? Was there to be another credit bubble?  Not again. Not another cycle of boom and bust. I could hear the words of the Credit Manager of the bank I once worked for echoing down from the barren post-1987 crash years, “This will never happen again”. Well, he has been at least 5 times wrong since. And the last one nearly saw the whole place circle the drain.

Twelve months on, we are thankfully getting a much more sober appraisal of the economic year ahead. The party line this year is that the economic trends of 2016 should mirror those of 2015. The US will see steady progress up an easy gradient of an estimated 2% growth while the rest of the world at best staggers along a flat path.

What can we expect during 2016?

  1. Weak Retail Sales – U.S. retail sales declined in December to ensure the weakest retail year since 2009. I bored everyone with the obvious in last year’s article (and ad nauseum elsewhere) by reiterating that the most significant driver of retail sales is disposable income. Right now, if people have it, they aren’t spending it. Rising healthcare and housing costs are exacerbating the continued weak wages growth for those who have decent paying jobs. Many people are scraping by. The jobs growth figures appear strong with an official unemployment rate of 5% which is technically full employment. No-one believes this number. But even if this were true, wages growth is lagging badly. If you are thinking of opening a bricks and mortar store, you better be a 1000% sure that you have the right product(s) at the right price for the right market and that you have a good quality, well targeted online presence, otherwise, don’t do it. I have retail clients and friends with retail stores in popular shopping districts in the greater Los Angeles area. Things are not good, and haven’t been for a while. The holiday season was a bust with a low year on year increase of 2-3% (below the National Retail Federation prediction, as usual), with early discounting, and with no last minute boost as experienced in previous years. We are waiting on January’s figures.
  2. E-commerce keeps clicking – web retail totalled more than $350B in the US for 2015. The US Commerce Department reports that internet retail accounted for 7.5% of total retail sales in 2015, up from 6.5% in 2014. For 2016, expect improvements in the functions of mobile online shopping such as slicker browsing and check-out processes, expect more relevant content coming your way than ever before through a more personalized online experience, expect more video content, and expect to see more social co-creation in 2016, especially in the apparel and accessory e-commerce sector where shoppers can drop their templates into existing designs and actually alter the designs of existing products and come up with personalized one-of-a-kinds.
  3. Careful with the plastic – there have been disquieting reports of the levels of household debt recently. a December 2015, Time.com article states, “Even after accounting for inflation, household debt has jumped 15% faster than income over the past dozen years.” They quote a new study by NerdWallet“After the significant dip following the recession, there was a lot of talk that Americans were using their credit cards better,” says NerdWallet credit expert Sean McQuay. “The numbers aren’t showing that. Americans are taking on more debt.” After the near meltdown of 2008 due to the overloading of debt, this news beggars belief.
  4. Continued social and political dysfunction – with a general election in November and with the delibitating influence of crazed nativists and religious militants both at home and abroad, we can expect continued social discord and political gridlock in the US. There is much handwringing in the US about the absence of legislation expected out of Congress this year as the Republican majority ensures no good and all bad for the White House and Democrats. There is not much to be done about this. With our rigged and corrupt political system and our polarized, irreconcilable social values, the best we can hope for is a Democrat to win the November election and at least keep the inmates from running the asylum.
  5. Which way the US housing market – most analysts believe the only way is up. Southern California saw a price increase of about 15% in 2015. The Real Deal website reports, “San Francisco prices are up 79.2 percent since 2009. Atlanta is up 53 percent. Phoenix, up 47.1 percent. Denver, 42.6 percent. Los Angeles, 49.7 percent. The magnitude of these gains rivals what we saw during the nuttiest portions of the 2000s bubble.”  The article goes on to state that “Don’t call this a bubble — mortgage borrowing is still low by historic standards — but things are changing. Consider a new type of mortgage San Francisco Federal Credit Union recently promoted. In response to “skyrocketing home prices” hampering affordability, the bank is offering a no-money-down mortgage with an adjustable interest rate and without requiring private mortgage insurance. Even 2005’s mortgage market would blush at those terms.” Prices will have to cool at some stage. Many analysts believe we are reaching that point.
  6. All eyes on China – some analysts believe that the China Syndrome the world caught in the last half of 2015 has passed while others are still concerned that a full blown contagion is still in the air. All agree that the Chinese economy will continue to slow. The positive take is that as China transitions both from a manufacturing-led to a consumer-led economy, and from a state-directed to a free market, it’s economic growth is hopefully slowing to a slower and more sustainable rate. A crash would be disastrous. China is such a big force in the global economy that the so-called “hard landing” that some predict would have a severe affect. Just last week, George Soros told an economic forum in Sri Lanka: “China has a major adjustment problem. I would say it amounts to a crisis. When I look at the financial markets there is a serious challenge which reminds me of the crisis we had in 2008.” Eek.

Soros isn’t the only doom and gloom merchant abroad. Some think the housing market in the US is overvalued by at least 25%. Others are, like Soros, think China’s convulsions are more serious than growing pains. Many think the US stock market is grossly overvalued. The Royal Bank of Scotland recently told their clients to “sell everything” because “in a crowded hall, the exit doors are small.”

Any one of these could occur. Who knows? For now, steady, sustainable growth is fine by me. The most important component of the “sustainable” is cash funded, not debt funded. We are in desperate need of more living wage paying jobs, and for more jobs with some wages growth. Until the population feels it has that bit extra to spare, it will not be shared around and the economy will continue to inch along.

My deepest concern is the outcome of the US presidential election. While I think Obama has been too lenient with Wall Street and the banks after their disgraceful and criminal activities leading up to the 2008 crash. And we don’t have a single payer health care or an expanded Medicare system, despite Obama explicitly campaigning and winning a strong mandate for health care for all. I believe he has done a remarkable job. Severely restricted by a bought and paid for Congress, he has run a pretty tight economic ship while paying for and winding down wars, keeping a gutted economy upright and ensuring the weakest and poorest aren’t completely forgotten.

He has also repaired some of the damage done by Bush and Cheney and their outlaws abroad. Obama’s “lead from behind” strategy in geo-politics is ridiculed in the US as weak but praised almost universally around the world as a relief. The world is done with the US bursting into the joint and blasting away like a drunken cowboy (or dry-drunk in George W’s case).

We are slowly gathering some positive momentum. A lurge to the right now by would be a disaster economically, socially and diplomatically.

Paul Brindley
Principal Adviser
paul brindley consults

Posted by pbc_admin
on January 13, 2016

Agenda Long Beach, January 2016 – More Partying Than Purchasing?

Last Thursday and Friday saw Agenda Long Beach open the US apparel trade show circuit IMG_20160107_111959for 2016 at the concrete cavern that is the Long Beach Convention Center in Long Beach, California.

Agenda Long Beach has been on a steady surge in size, popularity, diversity and activity since it’s inception in 2012. The show has expanded from a skate, surf and streetwear focus to include contemporary men’s and women’s apparel and accessories, outdoor, swim and lifestyle collections and industry services. I raved about the show in my review of the July 2015 show.

Last week’s show seemed off the boil to me when it came to foot traffic and overall energy. I didn’t feel the same buzz that usually runs through the rows of booths and on the open center concourse.

That said, there are some mitigating arguments for what I thought was a slower show.

By all accounts, the holiday season was slow for the majority of retailers. Many stores may not have had the buying dollars available for immediate goods to warrant attending the show.

It rained in Southern California last week. While most of the country would welcome our last week’s weather this time of year, locals could have taken the precipitation as a sign of the apocalyse, and thought that there wouldn’t be a season to buy for.

Agenda LB may be getting too diverse. The Long Beach show is by far the largest and broadest Agenda iteration. For instance, the Agenda Las Vegas is truer to the original core constituency with distilled street, skate and surf brand offerings. Long Beach attempts to be many things to many people. With contemporary apparel and swim trade shows spread solidly on the calendar in the first quarter, Agenda may have overreached by expanding to so many categories.

I had one industry veteran (who asked to remain nameless) opine that Agenda LB is becoming too much like the now defunct Action Sports Retailer (ASR) trade shows that had a 30 year run in San Diego until 2010. Why did ASR fail? Many reasons. One is thought to be declining clarity as to just what the show’s market was. As ASR diversified, did it cause confusion as to just what the show was about and who should attend? My contact thought that this could be happening to Agenda LB.

He also said that the show feels more like a party that a trade event. He noted how much drinking was going on in the booths. He also pointed to the skateboard ramp that made it’s debut at last week’s show, and said “it feels like just what happened at ASR”. By the way, I was nearly taken out by a skater flying off the ramp.

I don’t know about the drinking and partying bit. Agenda has always had a loose and fun atmosphere. I have seen many a 11AM beer being downed as buyers have been shown around the racks. Also I don’t know about the comparison to ASR because I never attended.

I didn’t see much that caught my eye. I did notice that some long time participants weren’t in attendance such as JanSport. The Australian women’s contemporary labels, Tiger Mist and Rise of Dawn also gave it a miss.

The contemporary men’s and women’s apparel and the accessories booths seemed quiet on both days.

There was one new brand that was fascinating. Cooperative of Photography (aka COOPH) from Austria has created it’s own category – Photography Wear or Photog Wear or Snap Wear or whatever someone cleverer than I can come up with.

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COOPH from Austria at Agenda LB

They design and produce excellent quality and very stylish gloves, headwear, hoodies, jackets, shirts and t-shirts with clever, innovative extras for photographers. For example, the underside of the bucket hat brim and the cap brim are grey cards, the shirts have a lens cleaning cloth sewn into the inside of the bottom hem, the hoodies have a lens cleaning cloth in hidden, zippable pocket and buttons for folding the jacket into a camera wrap or pillow.

So that was Agenda Long Beach for January 2016. A bit quieter than usual. Not a lot that was outstanding. I am going to reserve judgement on whether the show has grown too diverse until after the July edition.

Up next is LA Fashion Market Week next week. See you there.

Paul Brindley
Principal Adviser
paulbrindleyconsults.com

Posted by Paul Brindley
on August 26, 2015

Las Vegas Apparel Trade Shows Spring16: August 16-19, 2015

“It was fantastic. Our best show ever.”IMG_20150818_130024

“It was OK. Just like usual”.

“It was quiet. Foot traffic was down.”

I got the same old three responses from sales agents to the same old question on the last day of the 3-day bi-annual behemoth round of Las Vegas apparel trade shows last week.

The same old question? “How was the show?”

Most agents answered with the middle of the three responses. I usually concur. I generally find it difficult to divine the success of the massive Vegas trade shows. Who is walking the aisles? Buyers? Agents? Industry types? Exhibitors? There might be lots of bodies about but how much business is being written. However this time, I thought it was a better than average week across all shows. I have reposted a California Apparel News review below.

There are reviews of the individual shows at the Apparel News Trade Shows page.

I did have one industry veteran at Project Women’s whose opinion I respect tell me that buyer traffic was down significantly, and that it has been steadily declining over recent years. Her comment was, “Women’s apparel is struggling. Retail is struggling. We used to be so much busier at this show.”

The last few show weeks have had staggered starts. The Modern Assembly shows – Liberty, Agenda, Capsule, MRKET, Accessories The Show and Stitch at the Venetian Hotel Convention Center and the Sands Expo started on the Monday with all the MAGIC shows at the Mandalay Bay Hotel Convention Center and Las Vegas Convention commencing on the Tuesday. This time was an all Monday kick-off.

Kids Love Gate shoes from Japan at Liberty

Kids Love Gate shoes from Japan at Liberty

Last week’s jailbreak start created a smoothing out of the foot traffic over the Monday and Tuesday, which are the busiest days of the week. With the previous staggered starts, the Modern Assembly shows were very busy on the Monday. The buyer, media and industry hoards invaded the MAGIC shows on the Tuesday. The usual frenetic Monday morning at Liberty was clearly calmer this time. The first day energy was dissipated at all the venues.

You can scroll through my favorite picks of the week at my Instagram page.

I use Instagram to record and share the brands and collections that pop because they are different or interesting or adventurous or have potential or generally catch my eye. The shoes from Kids Love Gate on the right are an example.

The New York round of Spring16 trade shows are in the middle of September. I expect the momentum to continue. As my industry friend commented retail is struggling, but it seems the apparel industry has decided that there are better days coming soon. I hope they are right.

Paul Brindley
Principal Adviser
paul brindley consults

 

Apparel News logo

 

 

TRADE SHOW

Buyers Navigate Changed Format at Las Vegas Trade Shows

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Sourcing at MAGIC featured fabric and trim resources, domestic and international sourcing, resources, and technology suppliers.

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Saint James at Stitch

 

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Johnny O at MRket

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Show producers Sam Ben-Avraham and Sharifa Murdock at Liberty

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The White Crow booth at Project Women’s

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The Skies Are Blue booth at WWDMAGIC

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Rob Jungmann of the Jungmaven brand, pictured left at the Jungmaven booth at Capsule

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Marlies Dekkers at CurveNV@MAGIC

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Teresa Gipson, Evelyn Toles and Barbara Hawthorne show off the hats from Scruples Originals, which had a booth at the WWIN show.

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Agave at The Tents at Project

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Silk screening tote bags at Pooltradeshow

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Karl Kani at Agenda

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Johnnie Loves June at Accessories The Show

LAS VEGAS—The landscape of the Las Vegas trade shows changed again as the giant UBM Advanstar, owner of the MAGIC Marketplace and Project, re-merchandised the layout of its shows.

For the shows’ Aug. 17–19 run, ENKVegas was renamed Project Women’s, MAGIC Men’s was renamed The Collective, and the Pooltradeshow moved from a lower-level space in the Mandalay Bay Convention Center back to a space adjacent to Project on the main level.

At the Las Vegas Convention Center, Sourcing at MAGIC moved from the South Hall to the North Hall, and MAGIC’s newest partner show, CurveNV@MAGIC, bowed in a dedicated space at the back of the Central Hall next to WWDMAGICPlayground was in the North Hall, and the convention center’s South Hall featured footwear brands and sourcing resources showing at FN Platform and WSA@MAGIC.

In addition to the trade shows at the Las Vegas Convention Center and the Mandalay Bay Convention Center, buyers also shopped the Modern Assembly shows at the Sands Expo & Convention Center and The Venetian, including Liberty Fashion & Lifestyle Fairs, Agenda,Capsule, MRket, Stitch and Accessories The Show as well as the Offprice show, also held at the Sands. Buyers also visited the WWIN (Womenswear in Nevada) show at the Rio All-Suite Hotel and Casino and Kidshow at Planet Hollywood.

With so much ground to cover, some retailers had to ration the time spent at each show. That was the case for Don Zuidema, co-owner of the West Hollywood, Calif.–based menswear boutique LASC, who said he thought the many trade shows running concurrently in Las Vegas impacted attendance.

“I don’t see as many people [at the shows],” he said.

At the Velvet Heart booth at WWDMAGIC, owner Moshe Tsabag said traffic came in waves.

“We get a few people and then the booth is full. It’s been like this all day since we opened,” he said on opening day.

Tsabag said he was seeing a good response to the contemporary line Velvet Heart and the company’s new young contemporary brand, Free Heart. Buyers from Nasty Gal, ModCloth and Bloomingdale’s stopped by the booth.

“People are building inventory because they feel confident in business,” Tsabag said.

Peter Burke, chief executive of PJ Salvage, was equally upbeat about current market conditions. (The Irvine, Calif.–based sleepwear and loungewear company was recently acquired by Tel Aviv–based Delta Galil Industries Inc.)

Burke, who was also showing at WWDMAGIC, said retailers have told him that business is growing. “I think we’ll have a good holiday,” he said.

The first part of the year was challenging for many Midwest retailers, who saw business affected by bad weather, said Greg Garrett, co-owner of Irvine-based Z Supply, which produces the White Crow and Black Swan collections. But many of those retailers saw business pick up following the Fourth of July holiday, Garrett added. “We’re getting an early read on fall right now,” he said. “We’re getting a lot of reorders.”

At the Pooltradeshow, exhibitors were pleased that the show was adjacent to Project this season.

“I’m really happy it’s connected to Project,” said Freddie Rojas, designer of the Los Angeles–based Rojas line. “We get a lot of walk-through traffic.”

Rojas said buyers are starting to feel more confident. “They are looking for new things no one else has to be more competitive and to stand out.”

Bryn Thomas, head of sales for Los Angeles–based Lip Service, said he thought traffic would have been stronger if the trade-show schedules had been staggered. A few years ago, when the shows at the Mandalay Bay opened a day earlier than the shows at the Las Vegas Convention Center, Thomas said, the company had one of its best shows ever and opened several new stores.

“Sales were up at least 20 percent for all brands,” he said.

Pierre-Nicholas Hurstel, ‎chief executive office of CURVExpo Inc., which organized the CurveNV@MAGIC show, described the event—the first in partnership with MAGIC—as a “very successful relaunch.”

The show featured a mix of lingerie, swimwear, sleepwear, loungewear and hosiery resources.

For many of the swimwear exhibitors, CurveNV@MAGIC came at the end of a season of swim shows, but several said the Las Vegas show gave them a chance to meet with boutique and resort buyers who may not have attended the earlier shows.

“This is a great platform for new business and resort buyers,” said Debby Martin, national sales manager/retail marketing for Irvine, Calif.–based swim brand L*Space by Monica Wise, which is a longtime exhibitor at CurveNV.

Nathan Chera, who represents the Anne Cole SignatureCole of California and Anne Cole Locker brands, also said he saw a lot of resort and boutique brands. Chera said his company previously showed with other swim brands at MAGIC.

“This year is definitely better than last year,” he said.

Sands Expo and The Venetian

Now in its third year, the Liberty Fairs trade show has been tweaking its product mix since it first launched in August 2013.

“We finally got the flow of the show perfect,” said show founder Sam Ben-Avraham. “We have 20 percent of brands every season revolving [out of the show]. When it’s not the right mix, it interferes with the show. This season we had the ultimate brand selection.”

For Jim Kremer of Australian brand Shoreditch London, traffic at Liberty seemed a bit slow, but overall the show was successful.

“All of the people we wanted to see came to the booth,” he said.

Robert Myers, designer of SLVDR, said he thought traffic was on par with last year, but he expected sales to increase 25 percent over last year’s show.

Chris Josol, with the Los Angeles–based Flagshipshowroom, said he saw buyers from Amazon.com,Nordstrom, Bloomingdale’s, Urban Outfitters and Need Supply Co.

“People come to Vegas to finalize their orders,” he said.

At Capsule, George Vause, USA sales and operations manager for the New Zealand–based brand I Love Ugly, said the show’s timing helps wrap up the season.

“It’s the finale,” he said. “It’s when you close orders and lock down accounts and pick up the money.”

That said, Vause added, “You always get a buyer who waits for Vegas to do all of their ordering.”

Vause said he typically sees more of the brand’s West Coast buyers as well as Japanese retailers at the Las Vegas show.

“This is our best show,” said Brian Chan, founder of the Whittier, Calif.–based men’s brand Wolf & Man.

By the second day of the show, Wolf & Man had picked up orders from 20 stores.

This season, streetwear veteran Karl Kani was introducing his newly relaunched Karl Kani collection at Agenda. This was the first time in a decade that his brand exhibited at a trade show.

“People had been hearing the buzz that Karl Kani is back,” he said. “We wanted to establish that the brand is really out.”

Traffic was so busy at the show that Kani said he did not have time to leave the booth all day.

Stitch, MRket and Accessories The Show, the three shows organized by Business Journals Inc., were held in an adjoining space at the Sands.

Stitch, which consists primarily of contemporary womenswear, was brisk with business. This was the first time that Lori Marchand, owner of the Impulse Moda showroom at the Gerry Building in Los Angeles, was exhibiting her lines. She said she was doing particularly well with velvet burnout tops by Hariri.

Kristy Kurtmen was showing her family’s Kurtmen line of colorful leather cowboy boots, purses and leather bands at Accessories The Show. Her family designs and manufactures the boots and purses in Martindale, Texas, outside of Austin. They have been attending the show for five years and finding a following in the South, Midwest and West for their boots, which wholesale for $289 to $439. “The show has really, really been great,” she said.

At MRket, which showcases more-traditional menswear, exhibitors who made appointments were doing well. Tim Tobin, the regional salesperson for Robert Graham Clothing, was exhibiting dress shirts, tailored clothing and neckwear made by licenseeShirt Avenue in New York.

Shirt Avenue recently got the license for tailored clothing and neckwear and was eager to show the line. “It has been good,” Tobin said, noting that there was a cocktail party on the night of Aug. 17, the first day of the show, at the Mandalay Bay to celebrate the 15th anniversary of Robert Graham Clothing.

The Offprice show, held in the ground floor of the Sands, saw a 5 percent increase in exhibitors, according to Stephen Krogulski, chief executive officer of the show. The recent show featured 500 vendors exhibiting at 1,300 booths.

Offprice’s attendance has expanded from its base of traditional off-price retailers to include everything from individual Ebay sellers to independent grocery stores looking to add new products such as clothing basics and licensed goods such as sports team apparel.

Womenswear in Nevada

At the WWIN show at the Rio All-Suite Hotel, specialty-store buyers were in abundance. The show lasted for four days—from Aug. 17 to Aug. 20—while most of the other apparel trade shows at the Las Vegas Convention Center and the Mandalay Bay Convention Center held court for three days. The WWIN show’s traffic on the first day was helped by the fact that it was open until 8 p.m. and serving cocktails.

Becky Paulson, owner of two A Corner Cottage stores in Greenwood, Tenn., attends WWIN because the merchandise she finds there appeals to two different generations. She was looking for reasonable prices and trendy styles, such as tunics, that can be worn by both a mother and her grown daughter.

Tina Dyba, owner of Diamond Diva in the Las Vegas suburb of Summerlin, said she was searching for feminine Western wear and trying to keep her retail prices to under $100. “It’s hard to sell to shoppers right now,” she said. “It is all about price and not about quality.”

Sourcing at MAGIC

In addition to the apparel and accessories trade shows in Las Vegas, retailers and brands looking for sourcing resources shopped factories and resources from around the world in the packed North Hall at the Las Vegas Convention Center. This season, the focus of the Sourcing at MAGIC show was wearable technology. Companies such as DuPont were showing off their stretchable inks for wearable electronics.

Jon Lou, a Staten Island, N.Y.–based startup, talked about its development of a fashionable handbag that can charge your phone or tablet and light up inside when opened.

While the emphasis might have been on new technologies, there were a lot of old-technology clothing manufacturers from around the world at the show. Governments and trade-promotion agencies sent companies from countries including Jordan, Egypt, Turkey, Bangladesh, Vietnam, Guatemala, Peru and Colombia.

There was a contingent of 65 companies sponsored by the Indian government. One of those was Aman Sadh of Aman Fashion, who has one factory with 150 workers outside of New Delhi. This was his first Sourcing show in Las Vegas.

But he wasn’t writing that many orders because his minimums are 10,000 to 20,000 pieces. “People are coming by and asking for 500 to 1,000 pieces,” he complained. He said he can’t keep his wholesale prices down if he does small minimums. His shorts wholesale for $1.50, and dresses range in price from $5 to $8.

But he will be back because he wants to expand his U.S. business. “We have to participate for two to four years for it to click,” he said.

Posted by Paul Brindley
on August 07, 2015

I Don’t Want To Say I Told You So – Mid-Year Economic Forecast: Signs of Strength Tempered With Notes of Caution

.. but I told you so.economy_blogimage

In my article, Full Steam Ahead for US Economy in 2015? – Just Hold Your Horses There from February, I rebutted an assersion in the California Apparel News article, Full Steam Ahead for 2015 as Economy Accelerates and Gas Prices Drop from January that “just about everyone agrees that 2015 is shaping up to be a good year for the U.S. economy”.

I won’t restate my case. You can read the article yourself.

In short, 2015 has been a very choppy economic year on many levels. The stock market has been swinging wildly, the job market is still soft, wage growth is non-existent, retailers are struggling badly, the negative effects of international events have been a drag and the bizarre inverse relationship between the health of the economy and the effects of the prospect of a Reserve Bank interest rate rise is ever more evident. I mean how is it that the Reserve Bank thinks the economy is strong enough to consider an interest rate rise but even the consideration of a rise is forcing the stock market down?

The phenomenon is explained by Robert R. Johnson, President and CEO of The American College of Financial Services in Bryn Mawr, PN, and author of “Invest with the Fed.” He said the following about the effects of a rate hike on the markets in an interview with Forbes:

The market will likely react very negatively in the short-term and continue to perform poorly over the long-term. Some pundits are claiming that the market may view a rate hike as positive for the stock market because it signals that the Fed believes the economy is sound.  I disagree.

The research presented in Invest With The Fed shows that long-term stock market performance has been dramatically better in expansive monetary policy environments than in restrictive monetary policy environments.  Expansive monetary environments are defined as those periods during which the Fed is lowering rates.  Alternatively, restrictive monetary environments are when the Fed is raising rates.

Over a 48-year period from 1966 through 2013, the S&P 500 (SPY) returned 15.18% during expansive periods and only 5.89% during restrictive periods.  The Fed was expansive and restrictive about the same amount of time.  One of the most interesting findings of our research is that stock market returns are not as correlated with the level of interest rates (whether rates are high or low) as they are with the direction of interest rates (whether rates are trending up or down).

With all that said, the uneven economic performance of the first half of 2015 has validated the measured approach to the year that I was advocating in February. Such prudence seems to have been internalized by many in the financial media and the business community.

Following is a repost of an article from an early July edition of California Apparel News with which I mainly agree. There is no burying the lead here. It’s all in the title – Mid-Year Economic Forecast: Signs of Strength Tempered With Notes of Caution.

The only point I would argue with is with the prospects for retail in California. I think we are going to play out a weak retail year. My discussions with independent retailers in the greater Los Angeles area reveal an unhappy retail environment. There have been too many very slow days this year. With lack of quality jobs out there and virtually no wage growth for those with jobs, it is impossible for there to be a significant uptick in retail activity unless we go back to the very bad old days of shopping on plastic.

2015 may turn out to be the best economic year since The Great Recession (a.k.a The Great Financial Crisis or GFC in other parts of the world) but I think it is going to continue to splutter all the same.

Some see a strong second half: Kiplinger’s Economic Outlooks

Bloomberg agrees: Signals Flashing Green for U.S. Economy as 2015 Road Clears

Some think we are headed for catastrophy: Doom and gloom: 2015 global recession warning from financial seers of the century

Who knows? After so many lean years and so many false dawns of better days, I think its best to do to what so many of us have done since 2008: stay in the present, keep your resources close, carefully manage your spending and cash flow, and be very much the more financially wiser for the experience whether you are running a business or a household or your own finances.

Paul Brindley
Principal Adviser
paulbrindleyconsults.com

——————

Apparel News

Finance

Mid-Year Economic Forecast: Signs of Strength Tempered With Notes of Caution

California’s economic outlook for the remainder of the year is good, but it’s not exactly time to pop the champagne cork because the forecast is served with a helping of caution.

A recent economic report by the UCLA Anderson School of Management showed strong job recovery across the U.S. and in California and forecast increased growth in construction, business investment and consumer demand.

“I think things are on solid footing,” said Esmael Adibi, the director of the A. Gary Anderson Center for Economic Research at Chapman University.

The year got off to a slow start, due to several factors, including the work slowdown and chassis shortage during contract negotiations at West Coast ports, which left holiday merchandise stranded on cargo ships. But Adibi said in recent years, the first quarter has been typically been slow.

“Our first quarter for the last 10 years has been lower than what should have been,” he said. “Barring any unexpected events, we think the remainder of [this] year is going to show strong growth in terms of real GDP.”

Events such as the Greek financial crisis threaten to affect the U.S. economy for the remainder of the year, but with no such impediments, Adibi said, the country and the state could see job growth continue.

“That suggests that job creation, which has been relatively strong for the U.S. and California, is going to continue to be strong,” he said. “Job creation is the most important factor affecting California’s economy and consumer spending, retail and manufacturing.”

The Los Angeles County Economic Development Corp. (LAEDC) pegged the employment forecast as flat for nondurable goods in its recent “Los Angeles: People Industry and Jobs 2014–2019” report.

But Ilse Metchek, president of the California Fashion Association (CFA), said the LAEDC’s employment numbers don’t paint the full picture of the apparel industry’s economic health.

“You really can’t talk about the industry as a monolith,” she said.

The state’s employment numbers for apparel manufacturing are down, but the value of imported goods is significantly improved.

“In terms of apparel and textile sales [and the] value of shipments in the LA region, we are above 2010 and 2011 levels—and 2011 was our biggest year,” Metchek said. “It’s not made here, [but] it is part of the industry [and] it is not reflected in the employment numbers.”

Retail rebound?

Traditionally, summer in California has been strong for the state’s retailers, who typically benefit from tourism spending, Chapman’s Adibi said.

“It all goes back to the broader economy,” he said. As the job picture improves, people will have more discretionary income to spend on travel and tourism activities.

“Tourism should be very strong this year,” he said. “The only negative is foreign tourism is not going to be as strong because the dollar is strong. We’re not expecting as many foreign tourists. They will still come—but not as many as you would hope for.”

Still, more discretionary income overall points to good prospects for California retail.

“When it comes to the retail sector, there is some good news,” Adibi said. In addition to a better job market, consumers have also reduced their debt load, and there’s the “positive wealth effect” of a strong stock market and higher home prices, Adibi said.

“People feel good when they’re a little bit wealthier,” he said.

Plus, the ongoing low gas prices promise to also have a favorable effect on retail spending.

“We have not fully seen the benefit of lower gas prices in terms of shopping,” Adibi said. “I think that’s going to kick in as people realize gas prices are not going to spike back up.”

The only negative Adibi noted was the “anemic wage growth.”

“Even those people who have had jobs haven’t seen a significant raise,” he said, but added, “I think the positives are going to offset this negative, and consumer spending should be relatively strong for the remainder of the year, which should help the retail sector.”

A recent report by real estate investment commercial real estate brokerage firm Marcus & Millichap found that commercial real estate developers are accelerating the timeline on several projects in response to “heightened demand” and pre-leasing commitments are “above 80 percent, indicative of pent-up demand from retailers seeking premium space.”

But according to CFA’s Metchek, some of that demand is coming from non-traditional and start-up retailers. Online retailers are looking for go “clicks to bricks” to drum up additional sales, she said.

“You have the malls opening up their leasing space to start-up companies—not just legacy brands—because they need people to fill the space,” she said.

The retail sector is very fractured, Metchek said, adding that the bricks-and-mortar retailers who are faring the best are those with a “significant online following that brings [shoppers] back into the store.”

New retailers—such as H&M’s minimalist sister brand, COS, which opened its second U.S. store late last year in Beverly Hills—see strong business because they’re the “new kid on the block,” she said.

But Metchek says she sees such success stories as “Peter to pay Paul.”

“That business is coming from somewhere else,” she said. “The business in Eagle Rock or Echo Park or Silver Lake is coming from Robertson. If somebody’s hot, somebody else is cold.”

What’s needed is a significant fashion shift to drive consumers to the store.

“There is nothing you need to buy now to make yourself feel current—even for a fashionista,” Metchek said. “When the contemporary consumer —these people who are fashion leaders—think of a new look, then you’ll see business turn around.”