About Me

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Los Angeles, CA
Ilse Metchek, the President of the California Fashion association (CFA), created the organization in 1994, with assistance from the major financial and manufacturing participants of the region’s apparel industry. The CFA provides leaders of the Southern California’s manufacturing and textile community with the opportunity to share information about the business of conducting business in the current global economy.

Thursday, February 17, 2011

Impressions of MAGIC

Show floors visited: MAGIC, PROJECT, Workroom, Off-Price, Platform, Pool

Attitude of the exhibitors toward the 'traffic' depended upon the expectations of the exhibitor. Most of the newer 'hot' contemporary companies thought the show's traffic was positive because they were seeing more retailers and press people. The retailers in this space were looking for something new and reaching out to view the lines they may not have shopped before. The show, however, was disappointing for the long-time exhibitors expecting to 'write' orders based on past experiences, and who did not make appointments.

There was a cautious approach by the vendors at every level due to price increases of source materials. The specialty store retailers are realizing they will have to charge higher prices for the merchandise that will be coming in from their current vendors. This is another driver for the retailers 'shopping' frame of mind: The retailers are getting ahead of the curve by seeking alternatives, and are sampling new down-market vendors. This is the case unless they have established a 'must have' brand within the store or the department.

Even the higher priced lines (not quite 'luxury') know that the consumer has price on his/her mind. The vendors who are accustomed to higher margins for their fashion merchandise are caught in the middle of the re-thinking that is going on.

The cautious approach was echoed by retailers buying much closer to need. There was much more activity in the booths where bright colors and summer-y styles were being shown, than where transitional and fall merchandise in dark colors were in view.

Another impression is that the retailer is cautious as to the individual or company with whom they are dealing. With no specific trend as the most important one right now, retailers are selecting the vendor with the best reputation and track record for on-time delivery and service within their buying plan strategies. Conversely, when a new speck on the horizon (the return of 'preppy') is talked about, the knowledgeable retailers go back to those brands synonymous with that look (i.e.: Pendleton, Timberland, etc.)

As Roth Capital Partners' Senior Research Analyst Liz Pierce writes, "The obvious question being will price increases lead to demand destruction and if so, who in the supply chain will bear the brunt of the increase? At this point we think it is too early to tell, but we did hear that more and more retailers have accepted the reality of the situation and have started to raise prices, especially on newer and non-basic items."

The Off-Price show also showed the effect of the current economy. There was a clear lack of 'newer' merchandise available, whereas in recent years there was copy-cat availability throughout. Perhaps because there is nothing 'hot' to copy. On the other hand, it could be that vendors of all stripes and sizes are controlling inventory, mindful of the costs of over-cutting.

Ilse Metchek
CFA President