California Apparel News

The market for lingerie keeps growing. According to Port Washington, N.Y.–based NPD Group, a market-research firm, sales of bras, panties, slips and corsets climbed to $10.6 billion for the 12-month period ending in July 2007, a 10 percent jump over the previous 12 months.

While impressive, NPD’s figures cover the full range of the category, from sturdy foundation garments to racy bras and panties. Los Angeles–based Frederick’s of Hollywood Group Inc. has a long history of catering to the fashionable side of the market. The 62-year-old brand considers itself the originator of sexy intimates and hopes to position itself as the sexy and daring alternative to other lingerie brands.

On Jan. 29, Frederick’s completed its merger with New York–based manufacturer Movie Star Inc. The combined value for the company is $220 million. The merger gave Frederick’s $20 million in seed money to build more than 50 Frederick’s of Hollywood stores across the United States. The expansion could be completed by 2011.

The merger also made Frederick’s a public company. Its new stock symbol is FOH on the American Stock Exchange.

Frederick’s already runs 135 boutiques across America, including its Hollywood flagship store, which opened in 2005 near the intersection of Hollywood Boulevard and Highland Avenue. The new stores will emulate the flagship’s leopard skin–style flooring as well as its bra wall and mini-shops devoted to corsets and the brand’s line Seduction by Frederick’s of Hollywood.

Frederick’s President Linda LoRe and Yolanda Dunbar, the label’s senior vice president of branding, spoke to California Apparel News Retail Editor Andrew Asch about the merger and how it will help reinvigorating a grand old brand.

CAN: How do you know when risqueacute; is too sexy?

Linda LoRe: Sexy is in the eye of the beholder.

CAN: Victoria’s Secret seems to be so dominant in the lingerie market. How will the Frederick’s merger assemble a challenge to it?

Yolanda Dunbar: No one can deny their dominance. We are not taking them on. The beauty of expansion is really about giving the customer choices and the opportunity to shop a brand that meets her needs.

LL: We’re keeping true to our heritage in sexy lingerie. Every woman who owns a black bra and panties has Frederick’s to thank. Our customer aspires to the sexy Hollywood lifestyle. We’re going to be keep focused on the customer. We’re staying true to our DNA.

CAN: The merger was announced in December 2006. But it was completed in January 2008. What took so long?

LL: It was a reverse merger. It added some complexity. We had to completely restate our financials [for the merger]. But now the company is Frederick’s of Hollywood Group Inc., and we’ll have two divisions. One is the manufacturing division. The other is the retail division. We’re going to continue business the way we’ve been doing business. The beauty of the merger is that it allows access to [the] public market. It gave us access to $20 million. It is the seed money for expansion. We can grow at a faster pace than we could as a private company. We’ve revitalized, and we’re poised for growth.