Company of We (Photo by Jack Shanahan)
Posted THURSDAY JULY 16, 2009
From MEN’S NEW YORK MARKET PREVIEW ISSUE 07/16/2009
Commonwealth Utilities (Photo: Courtesy Photo)
Ron Poisson, the founder and designer of Cult of Individuality, began planning the launch of the men??™s denim brand in April 2008. In August, he showed his first collection to buyers at the Project Las Vegas trade show. The next month, Lehman Brothers filed for bankruptcy, marking the start of the economic meltdown. ???Was it the most opportune time to launch a new brand? No,??? Poisson said. ???We probably couldn??™t have picked a worse time to start a new business. But we didn??™t know how things were going to turn out when we started.??? Like Cult of Individuality, companies that were launched during better times in early 2008 all ran headlong into the recession. Those brands face difficult obstacles with cautious retail buyers wary of taking bets on unfamiliar names, as well as tightfisted consumers, a constricted credit market and minimal name recognition. However, for companies that have the funding and savvy to ride out the economic turbulence, the retail climate also provides some silver linings ??” such as fewer new brands clamoring for attention and stores shifting their merchandising and pricing strategies in ways that could benefit a start-up.
Cult of Individuality, for example, has found some early success despite the headwinds, and is now sold in about 100 leading specialty stores like E Street Denim, Atrium, Bill Hallman and Caruso Caruso. That??™s been on the strength of trend-right, high-quality product and sharp pricing, with its jeans retailing for $135 to $185. ???We always saw a niche for something priced at the lower end of the premium price scale,??? Poisson said. ???Fortunately, that strategy dovetailed with the economy, just as we were launching.??? In addition, many high-end specialty retailers have tweaked their buying strategies and have brought in some lower-priced merchandise to cater to budget-conscious shoppers. ???The silver lining in all this is that some stores who might not have been interested in a brand like ours are taking a second look,??? Poisson said. ???A lot of the top-end retailers only had jeans selling for $200 and up. I go in and show them the opportunity for a brand like ours, which has all the quality and style of a higherpriced product, but for a more accessible price.???
In fact, the biggest challenge for Cult of Individuality has been getting seen by buyers, who may not be eager to consider an untested brand. ???But once we can get into a store and buyers can see and feel the product and the value in the price, then the biggest obstacle is gone,??? Poisson said. Another major hurdle is many stores who do order product are not being approved by factors in the tight credit market. ???We use three factors, and when one doesn??™t work, then we try the next one,??? said Poisson, who added that many stores have turned to credit cards to finance orders. Up to 50 percent of Cult of Individuality??™s orders are now paid via credit cards. In riding out the recession, Cult of Individuality has the luxury of a deep-pocketed owner, a large apparel manufacturing company based in Guangzhou. Poisson declined to name the company, as it is a vertical operation that does denim manufacturing for many other brands.
With shallower pockets to rely on, New York-based Commonwealth Utilities has found the recession a challenging environment in which to find funding to help take it to the next level. The company launched its first collection during New York Fashion Week in February, and received positive feedback from retailers and press for its spot-on take on chic-but-wearable men??™s wear ??” but investors have been scarce. The company has been privately funded by founders Richard Christensen, who runs a boutique advertising agency called Chandelier Creative, and Anthony Keegan, a former men??™s design director at Donna Karan. ???Our business plan has changed a hundred times,??? said Keegan, who cashed out his 401(k) to help finance the company. ???In the beginning, it was just about making something fabulous. But now we??™re really thinking about how to create a proper business. It makes you pull up your socks and grow up really fast.???
Click here for the full story
–Nikki Cho Russo
Tags: Commonwealth Utilities, Company of We, WWD