California Apparel News

Lucky Brand Dungarees founders Gene Montesano and Barry Perlman and Chief Financial Officer Trent Merrill are experts in building a contemporary denim niche brand. They carefully planned the growth of their line, launched in 1992, until they attracted the attention of Liz Claiborne Inc. The New York apparel giant purchased the company in 1999.

Now the trio is looking to recreate Lucky’s independent spirit with Red Tiger Trading Co. Ltd., an umbrella company for contemporary labels.

“There’s a lot of talent out there and it’s nice to invest in that kind of thing,” Montesano said.

When they set out to create their new side project, they looked for someone with a track record for spotting and building contemporary brands.

Enter Joe Krafka, a mild-mannered apparel maker in his late 30s with a talent for developing small niche brands into mega companies. Krafka started out with a long stint at Mossimo Inc. during the label’s phenomenal early growth from an independent surf label to a publicly traded fashion brand. In the late 1990s, Krafka signed on with Earl Jean and helped the denim line grow from a $2 million indie denim label to a $40 million denim powerhouse.

With Krafka at the helm as president, Red Tiger began hiring a new team of designers. Montesano introduced Krafka to designers Eero Gathers and Glenn Williams, who would eventually join forces to produce Capital Tailors, a men’s and women’s contemporary sportswear label, under the Red Tiger banner.

Krafka had another designer in mind—surfwear designer Jason Bleick—for the next venture, an active contemporary line for men called Ever.

The company, which officially opened its doors last spring, is bowing two lines for Holiday ’03: Capital Tailors’ contemporary apparel line for women and Ever’s men’s line. Capital Tailors will follow up with a men’s line for Spring ’04.

Krafka’s focus is to develop a stable of young designer and contemporary brands for specialty retail.

“Both labels—Ever and Capital Tailors—are completely different from one another, but what the designers do have in common is that they are equally passionate about creating great product,” he said, sitting behind a modest desk littered with family photos and paperwork. Published business articles hang on a nearby wall for inspiration.

Red Tiger employs six people, including Krafka and his assistant. The company’s 2,400-square-foot headquarters is located in a nondescript building in the Little Tokyo area of downtown Los Angeles. The company has only one sample room, a 600-square-foot space that it has converted into a tailor shop for Capital Tailors’ samples.

“We keep things creatively separate, as the [parts of the] whole product development process are respectively independent of each other,” Krafka said.

Keeping Ever simple

Before moving into Red Tiger’s headquarters in late spring and becoming creative director for Ever, Bleick served for five years as vice president of men’s design at Quiksilver in Huntington Beach, Calif. His approach with Ever’s better casual collection is to keep the line simple, he said, adding that the main focus of the collection is the processing of garments and novelty treatments, such as over-dyeing and hand-sanding. The company imports the line’s fabric from Italy and Japan.

Ever’s young, active collection is inspired by world travel, Bleick explained as he sorted through the collection and pointed out subtle details: a sponge-made graphic print on a soft, ring spun and combed-cotton T-shirt, Asian-inspired, handstitched embroidery on a combed-cotton bomber jacket, and a hangtag pouch that contains a pair of earplugs.

Silhouettes include an authentic Army jean replica with vertical cargo pockets, an ivory-colored thermal-lined fleece hoodie with hand-stitched appliqueacute; and utility-inspired denim. Bleick also designed a pair of boardshorts made with Hawaiian-floral fabrics. The line, which has items that retail from $120 to $250, is geared toward specialty stores.

Action-sports apparel executive Bob Hurley of Hurley International Inc. has watched Bleick grow from founding his eponymous line to working at Quiksilver. He believes the Ever line is poised for success.

“I think Jason is amazing,” Hurley said. “He’s a great designer— he totally understands fabrics, fit and the market. I think he’ll do a great job with the line.”

Recently, the line quietly bowed at Los Angeles–based specialty retailers Ron Herman at Fred Segal Melrose and Lisa Kline Men, New York–based Scoop and Boston-based Louis of Boston. Krafka said he expects to put the line in roughly 30 doors worldwide by the end of the year.

In contrast, Capital Tailors designers Gathers and Williams use high-twist yarn fabrication to create tailored sportswear looks for men and women. For the women’s collection, they have tailored traditional men’s suiting styles to the female form. A peplum jacket comes with hook closures, a curtain waistband, bias-tape seams and blind hems. The designers jazz up the collection with garment washing and specialty treatments. The men’s collection features a snazzy glen plaid blazer with zipper taping on the pockets and preppy horn buttons. Some styles feature an allover crinkle resin treatment.

“The garments are constructed from the inside out,” said Gathers, adding that the line is inspired by many of the same tailored styles seen on window displays along Savile Road in London.

The line bowed at the Designers & Agents trade show last June during Los Angeles Market Week. Krafka projects it will have roughly 40 specialty-store accounts by year’s end. Currently, the line is sold at Scoop in New York, Ron Herman at Fred Segal Melrose in Los Angeles, TNT in Canada and Barneys New York in Japan.

First year sales for Red Tiger Trading Co. are likely to be somewhere between $5 million and $8 million, said Brien Roe, co-founder and managing director of Los Angeles-based Sage Group, which represented contemporary labels Earl Jean and Juicy Couture in their sales to Nautica and Liz Claiborne, respectively.

“As much as it is competitive out there for contemporary brands, Red Tiger Trading Co. has developed unique lines with great sensibility and appeal,” Roe said. “I suspect their margins will be quite healthy, given the wholesale price points and production efficiencies as I understand them and, in all likelihood, they should be profitable in their first year of business.”

Strategy for success

Krafka said he got much of his appreciation for the denim business while he was still working at Mossimo.

“I was intrigued by the whole cycle—from design to production, distribution and replenishment,” Krafka said. “I also liked the complexity of the denim market.”

When Krafka heard Earl Jean founders Ben and Suzanne Friewald were looking for a chief operating officer to take their company in the multi-million-dollar range, he stepped up to the challenge. He spent four years as COO and president of Earl Jean, where he helped the Friewalds grow the company.

He said the company “took a philosophical and realist approach” and developed an operating strategy to shape the direction of the company. “We wanted to deliver a jean with the simplicity and sophistication of Helmut Lang and the Americana and Western wear of Wrangler,” he explained.

Earl Jean co-founder and designer Suzanne Friewald said Krafka was a perfect fit for the company’s youthful image.

“We all had fun working together,” she said. “We were young and ambitious and there was a camaraderie between us.”

In 2001, the Friewalds sold Earl Jean to Nautica for $60 million. After the sale, Krafka said Nautica asked him to remain with the company as president, which he did for about a year and a half before deciding to leave.

“I felt like my job was done,” he said. “I helped develop an exit plan for the Friewalds, saw the transition through and decided it was time to pursue new opportunities with the guys from Lucky Brand Dungarees.”

Krafka said he plans to apply certain elements of his strategy at Earl Jean to the new company. He intends to keep his overhead low and his inventory levels manageable by producing only a few styles and by working with key accounts to get feedback before moving the line into production.

“There’s too much product in the market, but there’s always room for newness, and consumers always embrace fresh product,” Krafka said. “Our goal is to offer salable collections, not overly designed, and build on our relationships with retailers, suppliers and contractors.”

Red Tiger imports fabric for both collections, which are cut and sewn through various local contractors. About 20 percent of the company’s lines are produced in Hong Kong, Krafka said.

Krafka also recognizes the power of denim in the Asian market. Based on his previous success in Asia with the Earl Jean label, he said he would eventually like to see 50 percent of Red Tiger’s product in international markets.

“We’re not just going after specialty stores domestically––we’re targeting specialty stores all over the world,” he said.