Apparel Holdings Group is launching a better line as part of its plan to diversify its moderate-dominant business with higher-end offerings.
The Paradise Collection will make its debut with a spring 2007 collection, which will be carried nationwide in more than 100 doors of better specialty and department stores, including Dillard’s.
“Moderate has been the base of our operation, but we do want to diversify,” said Ross McConnell, executive vice president of Apparel Holdings Group. “It’s really important today to be in many areas — moderate is one, better is another. We could even be in designer, maybe in the next 12 months.”
The new better line will wholesale between $25 and $50 — the retail price range of Apparel Holdings’ most famous moderate line, Caribbean Joe. Like Caribbean Joe, the Paradise Collection will be a casual sportswear line. But the better collection, which has its own new design team, will take the form of more sophisticated silhouettes and will use higher-quality fabrics, such as silks and linens.
Apparel Holdings, which does more than $200 million in wholesale volume annually, anticipates $15 million in wholesale volume for the Paradise Collection next year and predicts it will grow to $50 million within a few years.
The Paradise Collection is just the latest step in Apparel Holdings’ diversification plan. As a private company that does the bulk of its business in moderate categories, it is working to get into the higher-end market. Executives emphasized the move is not that large of a shift for the company, whose lines are at the high end of the moderate market.
Apparel Holdings’ private label business served as its entrée into the better business at the end of last year. The company capitalized on the success of its moderate junior and children’s label, Periscope, to launch Cupid’s Cup and DNA It’s in Your Genes, better brands for that age range, in 2004 and 2005, respectively. The firm also is considering launching a men’s better line, following on the success of selling Caribbean Joe in special sizes to Casual Male XL earlier this year.
Feedback from retailers wanting better lines is what motivated the development of Paradise Collection, according to Apparel Holdings chief executive officer Jonathan Spier.
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The apparel manufacturer also is looking to acquire a small designer-level brand in the next year and is in talks with several designers now, according to executives. It wants a sportswear designer who already has a following but lacks the organizational structure and retail relationships in which Apparel Holdings specializes. It is seeking a brand that has potential to grow to $50 to $100 million in two to four years.