Tale of St. John Knits’ Success Is Good Yarn : Fashion: Irvine-based apparel maker is thriving as it celebrates 30th anniversary. The clothier produces classically styled women’s wear made of Australian wool and aimed at the affluent shopper.
They don’t look like much--the long strings of dully colored yarn awaiting their turn for a dip in the huge vats of dye. But by the time they make their way to the end of the production line, they will have metamorphosed into vibrant dresses and suits that retail for $600 or more.
The spaghetti-like streamers are the stuff St. John knitwear is made of: Australian wool, shipped raw to Southern California. St. John sends the wool to a company in North Carolina to have it spun, but everything else is done on site--from twisting the fiber into usable yarn, to dyeing it bright colors, to knitting the tailored outfits.
This year marks the 30th anniversary of St. John Knits--one of those California success yarns.
It all started with a single knitting machine, back in 1959. “My wife (then-fiancee) was a model on that TV show, ‘Queen For a Day,’ ” said Robert Gray, St. John Knits’ chairman and chief executive. “They were giving away knitting machines, and Marie was inspired to go buy one herself.”
At the time, Gray and Marie St. John worked for Cannady Creations in Hollywood, a now-defunct garment firm where they had met. He was a sales manager, she a secretary and part-time model.
Two years later, the young couple decided they wanted to go into business for themselves--somehow, some way. St. John sat down and knitted a couple of dresses that she designed herself.
“I wore them to work and all my friends said, ‘Oh, can you make one for me?’ ” said the former St. John, who later took her husband’s name. “I thought, ‘Well, maybe we can sell these.’ ”
But she quickly realized that the process was too time-consuming for her. “It took days and days,” she recalls.
So Marie and her husband-to-be hired an experienced knitter who could churn out one dress a day.
Robert Gray trotted the outfits around to department stores, on the off chance that someone would express interest. “They snapped them right up,” he said.
The couple realized they were on to something. They designed more dresses, hired more knitters, won more enthusiastic response. During their first year, they sold $100,000 in merchandise.
“We started moving from one factory to another, each one a little bigger than the one before it,” Robert Gray said. “We never took a class in knitting or design--we learned from experience.”
By the time they married in 1962, the couple had five machines and a half dozen knitters turning out nearly 100 dresses a week.
In 1971, with their clothing already in several major department stores, the Grays moved the headquarters for St. John Knits from North Hollywood to Irvine. “We decided that it would be wonderful to have a factory and office here--with grass and flowers out front,” said Marie Gray. “It was such a nice contrast from downtown Los Angeles.”
The company now has three factories and a design office in Irvine. It also has plants in San Fernando, Alhambra and San Ysidro, and a facility in Santa Ana for the design and manufacture of upscale costume jewelry.
Today, the St. John label sells at Saks Fifth Avenue, Neiman Marcus, Nordstrom, Bullock’s and I. Magnin. As its retail clients would suggest, St. John caters to an affluent shopper. The women’s knitwear--which ranges from conservative suits to sequin-splashed cocktail dresses--carry a hefty price tag of $600 to $1,000.
But the company continues to thrive, even in a threadbare economy. In 1989, St. John rang up $55 million in sales, and by 1991 they had reached $75 million. The Grays project company revenue of $90 million this year.
“It may sound trite, but we tend to perform better than other apparel makers during bad times because a woman gets more for her buck from us,” Robert Gray said. “We have a very loyal customer base, and we have investment-type clothing that doesn’t fall apart or go out of style.”
St. John apparel has cautiously evolved over time--it even went so far as to introduce denim jeans this year, priced at about $125. “Jeans have become such an integral part of a woman’s wardrobe that we felt we should offer our customers that product,” he said.
Yet the company has remained true to its roots. You can still see a touch of 1962 in the 1992 designs.
“Women wear our clothing for 10 or 15 years,” he said.
“St. John makes tasteful clothes for women who don’t care about fashion but care about looking well-dressed,” said Alan G. Millstein, editor and publisher of the Fashion Network Report in New York. “The woman who buys St. John suits is the woman who has never shortened her hemline. She finds a style she likes and she sticks with it.”
The company, he said, will continue to enjoy its good fortune partly because it faces little competition in its portion of the knitwear market. “And demographics are working in St. John’s favor,” he said. “We have an aging population, with more women over 35 than under 35.”
Perhaps the greatest change that St. John has undergone in its history came three years ago, when Escada AG bought 80% of its stock for an undisclosed amount. The Munich-based women’s apparel maker is publicly traded in Germany.
“They (St. John) found a sugar daddy,” Millstein remarked.
Indeed, Escada’s infusion of capital has allowed St. John to expand at an accelerated rate, the Grays said. Already, during the 1980s, the company had started to branch out--opening a boutique in Palm Desert and adding sportswear, shoes and accessories to its product line.
In the three years since Escada acquired it, St. John has unveiled seven more boutiques--in Honolulu, San Antonio, Dallas, Denver, Palm Beach, Fla., Boston and--just seven weeks ago--Manhattan. It will open boutiques in London, Munich and Frankfurt this year under the St. John name.
St. John hasn’t opened boutiques in Orange and Los Angeles counties, Robert Gray said, “because the retailers here do such a good job of distributing our product.”
Although St. John is 80% owned by a public corporation, and has a bigger pool of funds, it “operates like a family business,” he said. “Escada just told us, keep doing what you’re doing. (They have) always been pleased with our profits. They leave us alone, for the most part.”
A family business it is. Marie Gray is St. John’s chief designer. And their 25-year-old daughter, Kelly--who grew up with the company--has been on board ever since she was a teen-ager.
“I started out answering phones and wrapping packages--anything they would let me do,” Kelly said.
When she was 15, the striking young woman began modeling for St. John advertisements. Over the decade, she worked in various departments of the company, including advertising and accounting. Today Kelly is vice president and creative director. And she still models for St. John on the side--her photographs can be seen in such magazines as Vogue and Vanity Fair.
“My father is exceptionally demanding--he expects long hours and a high quality of work,” Kelly said. “But he is undeniably fair.”
St. John employs 1,500 people, 90% of whom work in the pristinely kept factories. The production lines display a colorful hodgepodge of art in process--a violet sleeve here, a turquoise bodice there.
Most of the clothing is now knitted by computerized machines, although some designs still demand the old-fashioned, and much slower, hand-operated devices. Computer programmers input complex pattern instructions onto software, which is fed to the computers that run the mammoth looms.
It has gone through many transitions over its 30 years--from one hand-cranked machine to dozens of artificially intelligent knitters, from an independent, family-run company to the subsidiary of a large corporation. But St. John has managed to maintain an air of immutability--its sleek styles stubbornly ignoring whatever might be the latest fad.
St. John did suffer failure in one bold fashion experiment a few years back: It briefly promoted a line of men’s wear.
“We discovered that men don’t care enough about clothes to spend a lot of money on them,” Robert Gray said.
After three decades, Marie Gray still marvels at her company’s enduring success, which materialized from a pair of hand-knitted dresses.
“At the start, my long-term vision was to make some money and go on an extended Hawaiian vacation,” she said. “I didn’t think this would turn into a big, wonderful business.”
Sales Soar
St. John Knits has managed to top its sales from the previous year for the past five years. Sales have increased 130.8% since 1987. 1992 projected sales: $90 million. Source: St. John Knits Inc.
Times researcher Dallas M. Jackson contributed to this report.
