Great Outfitter Denim Rocks Fashion & Retail Sales

Denim has changed radically in past few years, from basic work clothing, to a high-end stylish and fashion oriented attire. Denim is presently a 10 billion dollar industry in the US. From retailer selling in mass market to exclusive couture designers, everyone has identified denim as a profitable business.

The apparel industry veterans are amazed by the success of denim. Reviewing recent sales-graph and fiscal year results of the leading retailers and brands, the analysts forecast a better future for denim on condition that the product should appeal different to the consumer looking while sustaining the traditional fabric.

The American consumers approximately purchase 450 million pairs of jeans per year. The denim market has been performing well, except for a drop in the sales was witnessed because of stiff competition with the alternative products like cargos, fatigues, cotton combat and khaki trousers, which led market at a saturation point in mid 2004.

The saturation in the denim market was a result coming-out of garments and fabric in developing countries, due to the elimination of a quota system, in the beginning of 2005. However, the denim industry emerged again during 2005-2006. The evergreen work-wear fabric is back on track with the efforts of companies, such as ITG, Levi Strauss & Co., VF Corporation, American Eagle Outfitters and Perry Ellis performed well throughout 2005.
American Eagle Outfitters

American Eagle Outfitters come into view as triumph last year, emerging as leader in specialty store brands for the age group of 15 to 25. Comparing the $143.4 million sales month which ended April 30, 2005, the company recorded 25% climb in sales for April 29, 2006. The month of April depicted an optimistic consumer response to the company’s excellent initiatives for product assortments, designed for spring and summer that were also focused at other age groups.

The success standing behind, American Eagle Outfitters, in the denim market, is an outcome of right allocation of initiatives for various market phases. The perfect blend of the American West with European touch was the key reason of the gained success.

American Eagle Outfitters is a leading retailer that designs, markets, and sells it’s own brand of laidback, current clothing for 15 to 25 year old, providing high-quality merchandise at affordable prices. AE’s original collection includes standards like jeans and graphic T’s as well as essentials like accessories, outer wear, footwear, basics and swim wear.
ITG

Identifying the opportunities for growth in denim market, the Cone Denim business of International Textile Group (ITG) is focusing to meet its growing demand by making sourcing based in African developing countries. The company has recently taken initiatives to set-up a 28 million yard capacity denim plant in Nicaragua. This plant is anticipated to generate employment for nearly 750 people.

The Company has also announced that its Burlington WorldWide division plans to build a state-of-the-art cotton manufacturing complex in DaNang, Vietnam. The complex will be a joint venture operation called Burlington Phong Phu Supply Chain City, 60 percent owned by a subsidiary of ITG (a WL Ross & Co company) and 40 percent owned by Phong Phu Corporation, one of the largest textile and garment enterprises in Vietnam. The investment will exceed US$80 million.

International Textile Group, Inc. was organized in March 2004, by Wilbur L.Ross, to combine the assets of Burlington Industries and Cone Mills. ITG is a diverse, innovative provider of global textile solutions and distinguished market brands to apparel and interior furnishing customers worldwide. ITG operates four business units: Cone Denim, Burlington Worldwide (apparel fabrics), Interior Fabrics, Carlisle Finishing, and is affiliated with Nano-Tex.

Perry Ellis International

In a move to produce and distribute Levi’s Dockers men’s outer wear again in the US and Mexico, Perry Ellis International has entered an agreement with Levi Strauss & Co. for another strategic alliance. Dockers is considered as a world class brand that reveals the American style. The company plans to run the segment as a separate unit with the help and experienced of designers in Seattle.

Both companies have agreed in terms to distribute the brand through December 2009, with a renewal period by Dec 2012. The product line includes men’s coats, denim jackets, and synthetic fleece. Perry Ellis will start delivering the product this month into selected stores and networks.

Perry Ellis International, Inc. is a leading designer, distributor, and licensor of a broad line of high quality men’s and women’s apparel, accessories, and fragrances, including: dress and casual shirts, golf sportswear, sweaters, dress and casual pants and shorts, jeans wear, active wear, and men’s and women’s swimwear to all major levels of retail distribution.

The company, through its wholly owned subsidiaries, owns a portfolio of highly recognized brands including Perry Ellis, Jantzen, Cubavera, Munsingwear, Savane, Original Penguin, Grand Slam, Natural Issue, Pro Player, the Havanera Co., Axis, Tricots St. Raphael, Gotcha, Girl Star, and MCD. The company is also licensed to trademark from third parties including: Dockers for outerwear, Nike for swimwear, PING and PGA TOUR for golf apparel.
Levi Strauss & Co.

Meanwhile, the clothing giant, Levi Strauss & Co. has projected denim as a reputable outer wear. The company has reported a climb in net income for the Q1 FY2005-06 compared with last year. Even sales slipped, net income was up taking denim to the higher level of market. The company is already in the middle of transformation business to Europe, which will result the product assortment featuring more fashion and style.

The introduction of super-slim cigarette denim pant is an initial launch to this season. The looks of this collection can be ruthless at times, however, with the appropriate match it gives a nice slim look. The reason behind success to this collection is long and bunchy looks at the bottom that put one in illusion about the length of the pant.

Levi Strauss & Co is one of the world’s leading branded apparel companies, marketing its products in more than 100 countries worldwide. Jeans giant Levi Strauss & Co has launched a new corporate Website at: http://www.levistrauss.com.

The site provides consumers, students, potential employees, news media, investors and anyone interested in Levi Strauss and Co.’s rich, 153-year history with easy access to current and historical information about the company.

Levi Strauss & Co. designs and markets jeans, casual wear and related accessories under the Levi’s, Dockers and Levi Strauss Signature brands.

VF Corporation

VF Corporation has recorded a climb in full year earnings guidance, on a strong Q1 performance. Significantly, performance this year is being led by a powerful strategy for organic growth. The company is anticipating a climb in revenues by 6 to 7%, led by the momentum in outdoor alliances and higher anticipated revenues from its local Jeans wear business.

VF Corp. is planning to enter Indian markets through an equity joint venture with Arvind Mills. Licensing agreement between Arvind Mills and VF Corporation includes brands like Lee, Wrangler and Nautica. Both are likely to enter in 50:50 partnerships.

VF Corporation is a leader in branded apparel including: jeans wear, outdoor products, intimate apparel, image apparel, and sportswear. It’s principal brands include: Lee, Wrangler, Riders, Rustler,Vanity Fair, Vassarette, Bestform, Lily of France, Nautica, John Varvatos, JanSport, Eastpak, The North Face, Vans, Napapijri, Kipling, Lee Sport, and Red Kap.

Retail Margin, Trade Discount, and What it Means for the Author

DEFINITIONS

Retail margin is basically the difference between your book’s wholesale price and your book’s retail price. For example, a book with a cover price of $10 and a wholesale price of $5 has a 50% retail margin.

Wholesale price is the cost of your book to a retailer. To use the same rudimentary example, a book with a cover price of $10 and a retail margin of 50% will be sold to a retailer for $5.

Retail price is the same as cover price or selling price. This is the cost of the book to the end consumer (the reader). The retail price is typically printed on the cover of the book and also “embedded” within the barcode on the back. For example, a book with a wholesale price of $5 and a retail margin of 50% will have a retail price of $10.

As you can see, retail margin, wholesale price, and retail price are interconnected. By having two figures, the third can be calculated.

The fourth definition to be aware of is the trade discount, which is the percentage off the retail price that a wholesaler or distributor pays for your book. Since the retail margin is a portion of the trade discount, the trade discount always exceeds the retail margin. Distributors typically expect between 50% – 70% in order to provide an acceptable margin to the retailer.

MAKING DISTRIBUTION WORK FOR YOU

It should come as no surprise that the amount of distribution your book enjoys rests largely upon its trade discount. Generally, the higher the discount, the greater the distribution.

Think about it – distributors want to make money, too. So do retailers.

While your book’s trade discount is but a piece of your pie (albeit a big piece), it is the entire cake for distributors and retailers, who together must split the take. The greater the number, the greater incentive they have to distribute your book, sell your book, and market your book, etc.

The proper trade discount depends upon each author’s intentions, and can vary from author to author just as readily as from book to book. Obviously, the higher the retail margin, the higher the cover price, so authors interested in maintaining the lowest cover price possible will often opt for a lower retail margin.

Conversely, those authors who long for the best distribution possible will elect a higher trade discount, even though their cover price will increase accordingly (or their profit will decrease accordingly). Non-fiction or niche-markets are less affected by higher retail prices and greater distribution is often advantageous in finding those markets.

Often, the author will have little to no say in what trade discount to offer for their books — its whatever the distributor mandates.

Trade discounts can be as low as 20% to successfully get listed on Internet retailers like Amazon.com, who manage to make a profit with such low margins through EDI (electronic data interface) with distributors like Ingram and on-demand publishers like iUniverse and Outskirts Press.

By comparison, trade discounts can be as high as 75% – 80% when dealing with a niche wholesaler, or when attempting distribution for a book that does not have a proven market. In these cases, the distributor may be padding the coffers a bit in anticipation for a “harder sell” and perhaps, also, in preparation for offering an increased retail margin to close the deal.

INDUSTRY STANDARDS

Industry standards for retail margins are difficult to define because, ultimately, it comes down to negotiation between all parties involved. Publishers have the power to negotiate with distributors, who have the power to negotiate with retailers, who have the ability to negotiate with the reader, but the typical trade discount is around 55%, which allows for a typical retail margin of 40%.

Publishing-on-demand is removing some of the participants in this little dance, and as a result, the same piece of pie is being divided among fewer people, resulting in more money for the remaining players (especially the author).

The Retail Distribution Review – Overview

In 2006, the Retail Distribution Review (RDR) was launched by the Financial Services Authority (FSA). The RDR is a new set of regulations which will affect the retail financial services industry and enforce new, high industry standards. It was identified that there were problems rooted deep in the market which the FSA were very keen to uncover and solve. To paraphrase the FSA themselves, the RDR’s primary aim was to ‘fix the persistent problems which the retail investment market has faced over the last couple of decades’, such as a lack of consumer confidence and trust. The FSA assert that while the RDR might not yet be perfect, it is a ‘step in the right direction’ to improving the professionalism and quality of services in the market. So where is the RDR> now?

Four years on and the RDR is ostensibly still in its development phase, although much of the discussion has already taken place and all that is left is the ‘roll out’ phase, which now has an actual deadline. By the end of 2012 the RDR must be fully absorbed by financial advisers; of course, some are always quicker to adapt than others. Some of the initial reluctance is perhaps due to the retraining involved and the new qualifications advisers need to acquire. Some of the most experienced, respected and trusted members of the market will have to retrain and get new qualifications just to meet new regulation standards the same as anyone else. The FSA are, however, keen to not let professional become ‘outdated’, hence the relatively long period in which advisers are allowed to gain the new qualifications.

For some people, the RDR has given them the opportunity to be at the forefront of change and gain an advantage over their competitors; BWD Search and Selection for example – a specialist recruitment consultancy – have teamed up with an RDR specialist trainer to make sure their candidates are fully trained and up-to-date, making them highly desirable in the reformed market.

The question a lot of people are asking themselves at the moment is “How long can I wait before I have to retrain?” The only useful answer, that can be given with any certainty, is that recruiters will definitely be looking for the new RDR-set qualifications on candidate’s CV’s – if two candidates are competing for a job but only one of them has the latest qualifications, the decision won’t be a difficult one. If you’re safe and happy in your job (not only are you very fortunate) you can probably afford to wait until closer to the 2012 deadline. If, however, you’re looking to move between jobs within the industry then sooner is definitely better. So, how long can you wait?

The aim of this article was to introduce the topic of the RDR and offer a brief overview of what it actually is. This will act as the foundations for a short series of articles and updates to keep you involved with any developments and news about the market and RDR.

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