FASHION : Surfwear Sales Dip; Designers Hit the Streets

For a while it looked as if the surfwear industry was living out an Endless Summer. Neon swim trunks, T-shirts emblazoned with surf company logos and beach shorts covered with surfer graffiti were the hottest items in young adult wardrobes from California to Iowa. Beachwear manufacturers that started as cottage industries, such as Jimmy’ Z, Vision Streetwear and Maui and Sons, became emblazoned on the national consciousness.

There were fortunes to be made. Within a decade, Quiksilver became a $200-million international company; Ocean Pacific, Gotcha and O’Neill all topped the $100-million mark nationally.

But 1990 may be remembered as the year the bottom dropped out of the $2-billion industry and insiders agree on the reasons for the decline.

Designers themselves set the downward cycle in motion when it looked as if they forgot that fashion means change. Enamored of the formulas that brought success in the mid-’80s, they reproduced the same old styles season after season. If they ventured to change at all, it was usually to copy something in a competitor’s collection. Finally, all the designs started to look alike.

Then came the knockoffs produced by mass-market manufacturers at considerably lower prices. Consumers bought them instead of the originals; they could hardly tell them apart. Mass marketing led to mass volume, then to saturation. At that point, surfers and even wanna-bes stopped buying. Finally, the boom went bust.

So many beach-oriented companies are being sold or going broke that it’s easier to list the successes than the failures. Quiksilver, Gotcha, Stussy and Mossimo Sport top that very short list. And insiders predict the worst is yet to come. They say the final shakedown will affect up to 40% of the surfwear industry.

“The boom years are definitely over,” Shawn Stussy says. “Now only the most talented and strong will survive.”

The Shawn Stussy label represents a small but solid 6-year-old, $17-million-plus business. Mossimo Sport, owned by Mossimo Giannulli, is a 4-year-old, $20-million company. Gotcha and Quiksilver are the seniors in this group, which some see as the hope of the future.

Gotcha’s founder-president, Michael Tomson, still heads the 12-year-old company. Quiksilver, now 15, is run by Bob McKnight. Some industry watchers also include Rag Poets among the winners. Owner David Washer launched the $800,000 company last year, and his innovative style is turning heads.

Each of these companies continues to supply surfwear to the beach-oriented customers who have been the heart of their business. But now, each company is diversifying in the same unlikely direction: They are shifting their fashion focus to the city streets.

Quiksilver’s foray into men’s sportswear began last year with a collection of denim clothing. Gotcha is paying more attention to “multipurpose” products, says Paul Holmes, vice president of the company. “Walk shorts are getting longer, because they now have to work in the malls as well as on the beach.”

Gone are the large-scale logos and large prints of the recent past. Even the company’s newest surfwear is intended to be “amphibian”--wearable in and out of the water.

Giannulli built Mossimo Sport on volleyball shorts and T-shirts. But he says his new corporate role model is Calvin Klein. Giannulli still produces his signature shorts, but flanks them with dressier items, such as floral-print, patchwork and solid-color dress shirts. “When we started we were primarily selling an image,” Giannulli says of the unstructured T-shirts and elastic-waist pants for which his company has been known. “Now, I can’t wait to get to the details.” They include intricate snaps on trousers and hand-scripted logos on dress shirts that add sophistication to the clothing and broaden their wearability.

Stussy has always kept one foot on the streets. Now, he says, he is paying closer attention to successful ready-to-wear design companies whose collections consist of classic items with a long life span.

“How often does Ralph Lauren or The Gap change styles?” he asks, referring to his current role models. “I want someone to buy a pair of my jeans, wear them for five years and come back for another pair. I’m zeroing in on fabric, construction, and clothes that are of substantial value.”

If this is at odds with the trendy nature of the surf market, the companies offer no apologies. Says Stussy: “I have never wanted to be pinpointed as a surf line, and have always hoped people from a lot of areas would wear my clothes. “

But like the others, Stussy says he hasn’t forgotten the people who got him where he is today. “The beach is in my soul and I think it will always show through in the clothes.”

Along with a supply of surf-inspired T-shirts, Washer of Rag Poets is showing street-worthy, nubby cotton blazers with full-cut shorts in a mix of herringbone and check patterns.

The new orientation of these ready-to-wear-inspired items points to a rethinking of the surfwear industry, or at least the vanguard companies within it.

“To be successful now, companies will have to diversify,” says Tom Tashjian, consumer analyst for Seidler-Amdec Securities in Los Angeles. “Ideally, they will offer more casual sportswear and year-round fashions, in addition to surf clothes.”

After a restructuring of individual companies, Tashjian predicts, the market will rise again. It will happen in about two years, when the baby boomers’ children reach elementary school and begin to wear surf fashions.

Maybe so, but Giannulli of Mossimo voices a more conservative, even nostalgic opinion that many of his colleagues now share. He describes the ‘80s as a fantasy decade for surfwear companies. In the future, he says, “I don’t see it ever being the same again.”