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Discussions about the fashion industry thread

Zamb

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Am I the only one who read that and ended wanting to grab the BoO dude by the lapels and shake vigorously? He seems to desperately want an investor when that is what basically finished off BoO. If you can sell the **** out of sweats in a pandemic, how is your business model so fucked up you want to get an investor?
I read the article last night and laughed at his whole disposition projected in the story.
He said growth killed BoO yet he is seeking investment to grow.
I looked at his site, today if I have to run a clothing business selling that kind of fashion I’m giving up fashion altogether.
 

mozi

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I find it doubtful it's a "big cause", it is definitely "a cause". It might be a big cause for the new DCT brands, but fashion as a whole I would say PE/VC only accelerated the "drinking the kool-aid" (ever faster season/more discount etc.) rather than being the driving force.

what would you say is the driving force ?
 

clee1982

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Over supply in general, and for that, I would say fashion themselves. Even the guys who don't take PE money looked to expand, and then your familiar story of too much stuff, needs to discount, consumer never feel like paying retail, bad feedback until enough goes bankrupt to do something else different
 

mozi

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I read the article last night and laughed at his whole disposition projected in the story.
He said growth killed BoO yet he is seeking investment to grow.
I looked at his site, today if I have to run a clothing business selling that kind of fashion I’m giving up fashion altogether.

Absolutely. Entireworld looks like something that just does not need to exist. Who would miss it if it disappeared? Not sure who would be dumb enough to invest in a company like this...but apparently plenty of people were, at least pre-COVID.
 

cb200

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Regarding the need for investors. Even if you're selling through units rapidly, say sweatpants when everyone's sitting at home in them, and could grow the number of units there may not be sufficient capital to finance the growth to meet the real demand. Your current investor base may be "happy" but not able to add additional support to finance growth. Still need cash flow make payroll and keep things moving.

I'm not going to **** on the brand. They have some attention and some success in the most difficult period of modern apparel business.
 

cb200

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Sucks to hear about Unis. One thing I do wonder with all the NYC shutterings and the NYT story about Entireworld kind of brought to mind is if the cultural centre is moving more to the Westcoast now with tech and entertainment industry being there... Or is Covid, helping to liquify the idea of a cultural centre at all.
 

dieworkwear

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Sucks to hear about Unis. One thing I do wonder with all the NYC shutterings and the NYT story about Entireworld kind of brought to mind is if the cultural centre is moving more to the Westcoast now with tech and entertainment industry being there... Or is Covid, helping to liquify the idea of a cultural centre at all.

Culture here is also withering because of people's inability to pay rent. I think this is a problem in all major cities right now. People are moving out, but it's dispersed.
 

Zamb

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Culture here is also withering because of people's inability to pay rent. I think this is a problem in all major cities right now. People are moving out, but it's dispersed.
This.
When I moved to New York 20 years ago.
Rent was cheap in certain areas of the city. You had artist enclosed where artists could rent spaces and work to establish themselves. Now it’s almost impossible to do that on New York. The whole place is expensive to the point where Labdlords are diving up spaces and renting rooms.
You have 40+ year old adults who are living with 2 and 3 roommates because it’s impossible to comfortably afford a whole apartment by one’s self.

whrn they increase the minimum wage I said it was a bad idea, and people thought as a business owner I didn’t want to see people making more money.
Making more money was not the problem, the problem is that basic expenses are just too high and so people have less disposable income, less savings and are often straddled with debt such as student loans etc......
 

Epaulet

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Regarding the need for investors. Even if you're selling through units rapidly, say sweatpants when everyone's sitting at home in them, and could grow the number of units there may not be sufficient capital to finance the growth to meet the real demand. Your current investor base may be "happy" but not able to add additional support to finance growth. Still need cash flow make payroll and keep things moving.

I'm not going to **** on the brand. They have some attention and some success in the most difficult period of modern apparel business.

Agreed. I'd say that majority of clothing retailers and brands are funded by investment to some degree. Unless you have a lot of capital on hand to self-fund, it's expensive to purchase and hold inventory. There are natural peaks and valleys throughout the year, and both loans and investment help to get through that. It would be super rare for a business to successfully scale up without it.

I loved Band of Outsiders, and I'm personally a fan of Sternberg's work. Band had an amazing product lineup and a lot of ambition. Entireworld isn't impressive to me personally, but I see why it makes sense from an investment standpoint. The style is easy and quirky, and they're selling stuff that a lot of people can afford. If you do a massive ad spend and get that in front of eyes, you'll sell more.

On a separate note, Unis NY announced they are closing their NY flagship store of 20 years. They are moving to on-line only.

Ah man, that's really sad to hear. I hope that she makes it through this. Closing my original store in Brooklyn was a heartbreaker, so I know how much that sucks. Can't imagine after 20 years.
 

Epaulet

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This.
When I moved to New York 20 years ago.
Rent was cheap in certain areas of the city. You had artist enclosed where artists could rent spaces and work to establish themselves. Now it’s almost impossible to do that on New York. The whole place is expensive to the point where Labdlords are diving up spaces and renting rooms.
You have 40+ year old adults who are living with 2 and 3 roommates because it’s impossible to comfortably afford a whole apartment by one’s self.

whrn they increase the minimum wage I said it was a bad idea, and people thought as a business owner I didn’t want to see people making more money.
Making more money was not the problem, the problem is that basic expenses are just too high and so people have less disposable income, less savings and are often straddled with debt such as student loans etc......

I wonder how NYC (and probably SF) will possibly scale back in the coming year or two. Costs, rents, and taxes have reached an insane point, and they're going to resist the real need to come down.

When I closed my two NYC shops, people always assumed that it was high commercial rents that did it. And that wasn't the whole story.

My shop in Carroll Gardens, Brooklyn was actually pretty affordable. Towards the end (2016), I was paying a flat $5k a month, compared to maybe $3700 when we opened in 2008. The problem was that the residential costs got astronomical. The residents had to pay so much more for their daily lives - particularly if they were parents - that they were less inclined to spend at the local stores. New people coming in were increasinly high-income, but with high stress and demanding jobs to match. They had neither the time nor the inclination to explore the local retail scene.

In Manhattan, my last rent was $11,000. That's high, but not totally insane. Problem was that every year I had to pay half of the increase in NYC property tax on the overall building. After seven years in that space, this property tax bill for me was about $25,000. That was on top of my rent amount. With online killing brick and mortar retail and COVID killing hopsitality, who's going to be able to pay these huge bills and actually turn a profit.

I guess that NYC better legalize cannabis soon. In a lot of formerly strong retail corridors in LA, Med Men is the only place doing any business.
 

clee1982

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I wonder how NYC (and probably SF) will possibly scale back in the coming year or two. Costs, rents, and taxes have reached an insane point, and they're going to resist the real need to come down.

When I closed my two NYC shops, people always assumed that it was high commercial rents that did it. And that wasn't the whole story.

My shop in Carroll Gardens, Brooklyn was actually pretty affordable. Towards the end (2016), I was paying a flat $5k a month, compared to maybe $3700 when we opened in 2008. The problem was that the residential costs got astronomical. The residents had to pay so much more for their daily lives - particularly if they were parents - that they were less inclined to spend at the local stores. New people coming in were increasinly high-income, but with high stress and demanding jobs to match. They had neither the time nor the inclination to explore the local retail scene.

In Manhattan, my last rent was $11,000. That's high, but not totally insane. Problem was that every year I had to pay half of the increase in NYC property tax on the overall building. After seven years in that space, this property tax bill for me was about $25,000. That was on top of my rent amount. With online killing brick and mortar retail and COVID killing hopsitality, who's going to be able to pay these huge bills and actually turn a profit.

I guess that NYC better legalize cannabis soon. In a lot of formerly strong retail corridors in LA, Med Men is the only place doing any business.

the entire northeast has no real solution to high tax, a ton of liability, you can make tax even more progressive, but then your tax revenue would be volatile
 

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