Lower Prices on Women’s Clothes Are Now in Style
When women balked at paying $350 and up for suits, New York clothing maker Harve Benard took a drastic measure. It slashed what it charged retailers and encouraged stores to price this fall’s suits at a more affordable $190 to $239.
Designers at Liz Claiborne Inc., the huge maker of moderately priced sportswear, devised a machine-knit sweater for fall that is almost identical to and half the price of earlier hand-knit models priced at $150.
And no less a fashion eminence than Donna Karan, whose devotees pay thousands of dollars for items in her couture collection, recently launched her casual DKNY line. Among the offerings is a three-pack of T-shirts for $85, which, in her world at least, is peanuts.
Thus are some savvy clothing companies hoping to pry open the wallets of customers who for months have balked at paying escalating prices for women’s fashions that they viewed as shoddy, mundane or inappropriate, notably the miniskirt.
With 20 months of sluggish sales under their belts--the longest drought that many in the business can recall--a number of apparel companies and department and specialty stores appear to have sized up some of the problems that caused business to dry up in fall, 1987. For much of the slump, clothing designers have shifted from one hapless style to another and left high and dry those customers in search of fresh, high-quality fashions that didn’t take them to the cleaners.
But at long last, observers say, parts of the tattered women’s fashion business are on the mend, thanks to snappier styles and more realistic pricing. Some of the emphasis on keeping prices in line is akin to the “everyday low price” push going on in general merchandise and discount chains such as Sears, Montgomery Ward, Target and Wal-Mart.
On the other hand, in some rare cases during this fashion slowdown, companies have succeeded by moving upscale. But they, too, have converged on a void in the business where price and styling were mismatched.
Few companies escaped the downturn unscathed. The Gap and the Limited--the merchant-manufacturers that for years were the ones competitors copied--led the plunge. Even Liz Claiborne, which beat the socks off rivals by successfully appealing to 30-ish career women, showed an 11% profit drop for 1988. But all three are now winning kudos for strong turnarounds.
Prices a Sore Point
One prominent New York retail analyst, stopping short of calling recent sales gains a robust comeback because they follow weak figures last year, noted that clothing makers and merchants at least do not seem to be repeating the mistakes of last year.
“They’ve just stopped hitting themselves over the head with a hammer,” said Joseph H. Ellis of the Goldman, Sachs & Co. investment firm.
The high price of keeping up with the fashionable Joneses has been a sore point with women for years, although they went along when the styles were well defined and compelling. Baby boomers in the 1960s and 1970s bounced from minis to maxis or from bell bottoms to cigarette-leg jeans, often replacing entire wardrobes to keep up with the fashion vagaries.
Once these women entered the work force, building a wardrobe became the object. And when design mavens went astray and started foisting off youthful or uninteresting styles on these women at outlandish prices, customers simply laid off spending.
“Prices are ludicrous,” said Walter K. Levy, a New York retail consultant. “When you look at a blouse for $200 and men can buy a suit for $250, there’s something wrong.”
Even cartoonist Cathy Guisewite--whose alter ego Cathy typifies the high-strung, consumption-minded 1980s yuppie--has poked fun at the clothing industry and the cost of staying chic.
In the view of some manufacturers, part of the problem was that stores inflated their markups to help subsidize markdowns. Customers caught on and increasingly waited for items to hit the sales racks. (Stores, in turn, point to ever rising wholesale prices as the cause.)
Trying to Stimulate Business
Harve Benard saw an opportunity in bringing the initial price down to a level that stores and customers could live with.
“With everything going up in price, we’re going the other way,” said Robert H. Cohen, a vice president at Harve Benard. “It’s a way to shake up the market.”
By cutting the wholesale prices of its career suits, the company plans “to stimulate a constant day-in-and-day-out business,” he said. Rather than buying just one suit, he reasoned, young customers will be able to afford three or four. Styling, fabric and quality, he said, will stay the same.
To accomplish the reductions, Harve Benard has cut special deals with fabric suppliers and garment factories in return for guaranteeing increased volume. And the company is actually slicing its own profit margins. By making less on each suit but selling lots more of them, the company figures, it will reap bigger sales and profits.
So far, store buyers have reacted enthusiastically, Cohen said, but the acid test with customers will come when the fall suits hit the stores in June and July. The goal is for suits to account for 60% of the company’s wholesale business, up from 35%.
Instant Success
Designer Karan, known for pricey garments, also saw a void in the more moderate arena. When she couldn’t find any jeans to fit her, she made her own.
“Donna had a lot of clothes that she’d like to wear, but she couldn’t really design those in her collection line,” said Denise Seegal, president of DKNY. “They didn’t fit into the price points or attitudes.” So was born a casual line featuring $85 jeans, $95 poplin shirts, $350 jackets and $195 khaki silk wrap skirts.
On a Sunday morning in February, 380 customers showed up at the Bullock’s department store in the Beverly Center to get first crack at DKNY. “We were packed,” said Cheryl Fox, a Bullock’s spokeswoman. “They went wild over her merchandise.”
Even if DKNY prices are steep by most American women’s standards, the line’s instant success seemed to demonstrate pent-up demand for the right fashions.
Giving More Value
At Liz Claiborne, the sobering downturn made officials more sensitive to price and styling.
“We’re trying to give consumers as much value as we can,” said Vice Chairman Jerome A. Chazen. “We’re sharpening our pencil wherever we have to. Maybe we’ll make a little bit less money on individual things.”
The company made some wise early commitments for fabrics such as wool and silk that are cushioning it from recent drastic upswings in price. And savings such as those on the machine-made sweaters that look hand-knit are helping to hold Claiborne’s fall prices overall to last year’s level, and, Chazen reports, “The stores love it.”
As a sign that many women are indeed resistant to rising prices, Chazen noted that more Claiborne customers are buying cardigans rather than blazers to complete their outfits. The cardigans generally cost about half what a jacket would.
“I think there’s always going to be a small segment that’s going to want the kind of clothing that makes them talked about,” Chazen said. “But most women, especially at today’s prices, are being much more practical in terms of wardrobe needs.”
New Push Upscale
If Harve Benard, Karan and Claiborne moved down or held the line on prices, other companies have successfully gone upscale.
Allen B. Schwartz, chairman of Los Angeles-based A.B.S. Clothing Collection, recently switched out of the shrinking, trendy contemporary market into the bridge business with what he describes as “casual career” clothes. The designs are geared to women who want fashion classics with an updated twist without paying couture prices.
Each week, the company brings out a group of 12 to 18 new pieces, compared to many companies that bring out only four or five groupings a year. Many are featured at the company’s sole retail outlet in Santa Monica. Even on weekdays, the shop bustles. For spring, the store’s most expensive item is a silk blazer that feels almost like suede and costs $302.
Emily Draper, a free-lance costume designer from Westwood who was shopping at A.B.S. recently, said she tends to shop at specialty boutiques offering more unusual, and often more expensive, clothing. “The prices are not the problem,” she said. “A lot of the stuff in the department stores is just ugly.”
Quality Fits Price
What A.B.S. is to successful women in their 30s, 40s and 50s, the Limited’s Express division is to younger women.
When the chain started six years ago as Limited Express, it carried hot junior fashions in small stores decorated with bright lights and white tile. Today, the chain--renamed Express Compagnie Internationale--is appealing to an older crowd with prototype superstores featuring wood floors, sleek props, more sophisticated clothes--and higher prices. The Euro-chic setting comes complete with piped-in sound track that sounds like a French radio station. The reformulation is going over well with customers.
“We’ve changed the quality to fit the price,” said Pete Grimes, executive vice president of operations for Express. “You can’t take a garment that last year you were selling for $20 and this year decide to sell it for $28 and not change it.”
The success of Express has been in spotting fashion trends early and putting its massive clothing manufacturing facilities firmly behind them. A few years ago, when neon-colored styles were featured in tiny areas of department stores, Express “made an entire store of it,” Grimes said. “We were not afraid to make a fashion stance.”
But when some of the successful young looks at Express went out of vogue seemingly overnight in late 1987, the chain suffered. Now it appears to be safely back on track, but it’s appealing to an older customer. “Where our target customer used to be 21, it’s now 28,” Grimes said.
Bargain hunters, note: The $48 tapestry vest at Express could pass in a pinch for the $136 model at A.B.S., and both have fraying button holes.
Despite the renewed optimism of companies such as the Limited, Harve Benard and Claiborne, clothing makers acknowledge that the industry is not yet out of the woods. John Pomerantz, chairman of Leslie Fay Cos., a huge maker of suits and dresses, told shareholders at the company’s annual meeting that “1989 is shaping up as a puzzling year in retail, with some categories of merchandise shining and others being slow to develop.”
As quoted in Women’s Wear Daily, a trade publication, he offered a clumsy metaphor: “There’s no consistency. Blouses may have a good week, then it will be sweaters or some other category. It’s hard to put a candle up to know what’s hot at any given time.”
