Fred Segal Is Banking on the Green Stuff

The Fred Segal reputation started in a 300-square-foot shop on Santa Monica Boulevard almost 30 years ago.

It was there that Segal opened the nation’s first jeans-only boutique. His concept--marketing trendy jeans with designer prices to rebellious 1960s consumers--took off like a bullet, earned him a fortune, allowed him to expand his clothing empire to half a block of boutiques on Melrose Avenue, and established his reputation as a fashion innovator. Fans would camp out overnight in long lines for his annual sales.

In the mid-1980s, Segal converted a Santa Monica ice-skating rink into a cluster of hip boutiques that have inspired similar loyalty.

Customers know they can find goods ranging from Franco Moschino jackets and New Stone Age dresses to Katherine Hammett earrings and Armani silk ties.

And at Fred Segal Santa Monica, they can drop off their kids at an on-site playground, nibble a vegetarian salad and bop to the latest from Sinead O’Connor or Soul II Soul, spun by a disc jockey in a glass booth.

Retailers agree that Segal has the Midas touch.

Now Segal is preparing to launch his most ambitious plan yet: An environmental marketplace that will stock ecologically sound products--everything from organically grown cotton shirts and formaldahyde-free linen sheets to solar-powered lawn mowers and drought-resistant plants.

“What my jeans store did for the 1960s, this is going to do for the 1990s,” Segal, 58, predicts. “The entire concept of being environmentally conscious is in fashion today. It’s the fashion statement of this generation.”

Four months before its planned opening, the details are still sketchy and Segal has decided to finance the project himself after potential partners dropped out. One investor doubted whether Los Angeles would support a store that focused mainly on “green” products.

But retail analysts and environmental activists say Segal’s latest project has promise.

“It doesn’t have K mart potential, but I think it has the potential to be profitable . . . and duplicated at other locations,” says Sarah Stack, an independent retail analyst based in Los Angeles.

“If his products can be sold in a way that provides good, sound information without a lot of vague, green hype, I think people will flock,” says Joel Makower, who wrote the book “The Green Consumer” and now edits the monthly newsletter “The Green Consumer Letter.”

Makower says green mail-order firms, including “Seventh Generation” and “Real Goods,” are thriving. He adds that stores that stock such products are popping up all over the country, although they are usually homespun offshoots of health-food stores rather than the slick, upscale venture envisioned by Segal. (An exception is Terra Verde in Manhattan’s Soho, a sort-of green “Builder’s Emporium” that stocks low-flow shower heads, nontoxic paints, lotions and a few clothing items, Makower says.)

Tom Julian, fashion director for the Men’s Fashion Assn., a national trade group, says he finds the concept “timely, marketing-minded and consumer-driven,” adding that Segal is a natural to pull it off.

“When you say Fred Segal, there’s a definite level of respect in the business. He’s not only cutting edge but has a successful retail operation,” Julian says.

(In person, Segal appears more like a New Age Calvinist than a trendy clothes king. Friends say he has pared down his wardrobe to the essentials. Years ago, he insisted that his son Michael, who now runs financial operations for the Fred Segal empire, buy most of his clothes at J.C. Penney.)

Segal hopes to open his 15,000-square-foot environmental marketplace in July, across the street from the 35,000-square-foot Fred Segal Santa Monica at 5th Street and Broadway. He has spent $900,000 to remodel a former state unemployment office, raising the ceiling, installing skylights, stripping out toxic insulation and putting in wood floors that haven’t been treated with harmful chemicals.

When the store opens, Segal, a longtime peace activist, envisions leasing out space to environmentally conscious retailers and organizations like Physicians for Social Responsibility, a group he has supported over the years by providing rent-free office space in Malibu. (Segal also is planning a “Peace Park” on a 250-acre Malibu site he owns, complete with a Japanese pagoda, a Chinese Buddhist temple, offices for nonprofit environmental groups, a peace school and an organic farm.)

The setup would be much like his complexes on Melrose and in Santa Monica, where Segal continues to own the property but has sold off the boutiques and leases out the space.

“We want to provide a marketplace for people who have nontoxic products available but have nowhere to market them,” Segal says. But he adds that not all the products offered at his new store will be 100% pure, environmentally correct.

“As much as possible, we want to support companies that are making the changeover . . . but we’re not perfect yet,” Segal says, munching on a Greek salad at the health food snack bar in the Santa Monica complex and looking slim, fit and tan in blue jeans and matching work shirt.

Segal has tapped Prasuti Kirk Goss, an environmental activist and self-styled “eco-preneur” with 20 years experience in running her own retail businesses, to manage day-to-day operations at the new marketplace.

Each item will be graded for its environmental soundness, with tags that explain why the products are more healthy than typical retail fare. Apparel, for instance, might include recycled contemporary attire or vintage clothing, as well as new, natural fiber garments that use nontoxic dyes made from plants and minerals, and buttons made of bone or mother of pearl. Kirk Goss says she has even found a supplier who grows organic cotton in two natural colors--khaki and green.

Packaging will be minimal and, Segal warns, customers will have to bring their own bags or use one of the canvass ones he provides. Plastic is strictly verboten .

Prices will be “competitive,” Segal says, although he refuses to elaborate. But he will say that he believes a backlash is growing against the pricey, trendy clothes that line so many Los Angeles area boutiques--including those that bear his name.

Segal says he isn’t worried that he might be creating competition for himself, adding that “it’s the healthiest thing for any business.” But, he says: “We’re not looking to compete. . . . We’re hoping to create new shopping patterns for people.”

Cynics may snicker to hear Segal, one of the nation’s most successful and au courant clothing retailers--his Melrose shops grossed $17 million in 1990; his Santa Monica location raked in $15 million--speak so earnestly about changing the shopping patterns of those who keep him in business.

Indeed, environmentally aware fashion might strike some as paradoxical, especially in an industry that thrives on planned obsolescence.

“I don’t think we’re going to eliminate consumerism,” Segal says. “I think we’re going to make it healthier.”

Segal hopes his “eco-store” will spark a national trend, setting the pace for responsible retailing in the 1990s.

“We want to create a market for environmentally sound products . . . and hope that other stores can use ours as a role model,” Segal says. “The more people buy, the more prices will come down. We want to create a consumer movement.”