California Apparel News

Inside a nondescript brick building in the middle of an industrial neighborhood, the founders of T-shirt line Michael Stars are gathered in the design room, scrutinizing a table of rainbow-colored fabric swatches that are potential candidates for next year’s Spring/Summer season.

Michael Cohen stands at one end—attired in a lavender T-shirt, khaki shorts and rubber Crocs—looking as if he were headed for the beach or the Greek isle of Mykonos, where he has had a second home for nearly 30 years. Next to him is his wife, Suzanne Lerner, appearing a little more formal in a black knit sweater and black-and-white striped T-shirt.

They are joined by Susan Peterson, their creative director for the last two years, and all of them are surveying solid-colored and striped fabric cards.

Cohen and Lerner have been doing this periodic dance with design for many years, but this year it takes on particular importance. This is the company’s 25th year in business, and the enterprise is still going strong despite several recessions, the rise in cotton prices and increased competition from big corporations.

“When we started, it was nothing like it is now, except for the number of colors we use,” said Cohen, who launched his company in 1986 by buying boxy, unisex T-shirts and employing an artist to hand-paint arty designs on them.

Since then, the Los Angeles label has evolved into a lifestyle brand of fitted women’s T-shirts and a broad range of tops in bright hues and subdued tones made of soft cotton. The label now includes knit dresses, skirts, sweaters, shorts, jackets and accessories. Magazine photographers periodically capture celebrities such as Sharon Stone, Jessica Alba, Hilary Duff and Carrie Underwood walking down the sidewalk in a cardigan or a dolman-sleeve top.

For its collection of clothes, Michael Stars targets women between the ages of 28 and 38, but the brand is popular with all age groups. T-shirts sell for about $54 to $78 while sweaters fetch $108 to $248. The Michael Stars label is synonymous with the California lifestyle and a contemporary look forged out of quality fabric that makes a piece easy to wear.

“They put out a great product. The quality is there, and the value is there for what you pay,” said Shelda Hartwell-Hale, vice president of Los Angeles–based buying office and trend forecaster Directives West. “I have had Michael Stars T-shirts in my closet for at least 10 years, and they still look new.”Boutique appeal

Bloomingdale’s was one of Michael Stars’ first customers and still is. Since then, the brand has branched out to more than 1,300 specialty stores that can depend on the label to guarantee a three-day turnaround on certain basic tops and a 15-day turnaround on certain styles often stocked in the company’s warehouse/office, which encompasses 40,000 square feet.“We’ve been carrying Michael Stars since we opened eight years ago,” said Sarah Whisler, store manager for B Boutique, a specialty store in the coastal town of Seaside, Ore. “The fit is effortless. It is ready to go. You can dress it up or dress it down. And they fit a wide range of body styles.”

The Garment District in Denver is one of Michael Stars’ top specialty-store customers and has been stocking the brand for years. “It is great quality, well priced and made in the USA, which appeals to a lot of people,” said Linda Stevens, co-owner of the 10,000-square-foot store, which is not too far from the University of Denver. “They have up-to-date styling and a fantastic color palette.”

About 90 percent of Michael Stars’ merchandise is made in the United States while the company’s sweater line, called M by Michael Stars, is made in China.

When Michael Stars started, it was a small company that generated $150,000 in revenues its first full year of operation. Since then it has burgeoned into a multi-million-dollar company—Cohen didn’t want to disclose revenues—that has garnered interest among people in the mergers-and-acquisition field. Not too long ago, Cohen and Lerner were approached by a big corporation about buying the label. (Several sources said the company was Kellwood Co.) But Cohen and Lerner said that for them to sell all or a portion of the brand, it would have to be the right buyer. “It would not only have to be the perfect partner but someone who cares about the employees like we do,” Lerner said. Michael Stars employs nearly 200 people. Expansion plans

Right now, Cohen and his wife are concentrating on future projects, such as expanding their chain of 11 Michael Stars stores—launched first in 2001 with one store in Manhattan Beach, Calif. They hope to add two or three more stores a year in places such as New York, Texas and Illinois, as well as open a few outlet stores. Their first outlet store will debut in 2013 in a soon-to-be built premium outlet mall near Tracy, a northern California town.

They are also expanding their international distribution, which currently covers Canada, Germany, Belgium, the Netherlands and Luxembourg.

Other projects down the road include adding men’s tops to the mix as well as expanding into swimwear and childrenswear.Many of the expansion plans are a natural part of growing a business. But it is also because Michael Stars, like many apparel companies, has seen its revenues shrink over the last two years as many specialty stores closed their doors and consumers reined in spending.

One successful area of growth in the past two years has been licensing, with Michael Stars partnering with Signature Eyewear in El Segundo, Calif., to launch eyewear and sunglasses. It also is working with the Green Tea Group in Irvine, Calif., to license scarves, handbags, flip-flops, espadrilles and other accessories.Deep roots

Cohen started Michael Stars after a successful sales career with Simon Shirts, a London-based company. He moved in 1976 from his native Cape Town, South Africa, to Los Angeles, where he took over sales.

After leaving the shirt company in the early 1980s and buying a place in Mykonos, Cohen, then in his mid-forties, thought he would retire. But that lasted about a month.

He came across the idea of colorful T-shirts with French-inspired graphics and took the idea to Lerner, who was about to open a small showroom with a partner in the California Market Center in Los Angeles.

Lerner took a look at the line and said she would get back to him about it. “He walked in with these cute designs on ugly poly/cotton sweatshirts with shoulder pads,” Lerner recalled, noting that Cohen couldn’t find the T-shirts he normally bought. She called and told him she wouldn’t represent the line. But she did ask him out for dinner.

Cohen revamped his line, buying some short-sleeve T-shirts and applying graphics with the help of an artist.

Lerner ended up carrying the T-shirts in her tiny showroom. Her first order went to the high-end contemporary specialty store Fred Segal, which bought 36 shirts. The second order went to Bloomingdale’s, which also bought 36 T-shirts. The rest, as they say, is history.

To celebrate their 25th anniversary, Cohen and Lerner this fall will be partnering with InStyle magazine to promote the company’s “tee for a tee” campaign. For every Michael Stars T-shirt purchased at one of the company’s stores or online, the company will donate a T-shirt to a woman in need.