The company, which manufactures premium apparel chiefly for direct-to-consumer brands like Stitch Fix, Bonobos and Everlane, has been expanding its repertoire this year after an IPO last fall. This week, Lever Style announced the purchase of Delta Industries Limited, a Hong Kong-based company with manufacturing operations in China and Vietnam that supplies jeans and denim staples to labels like Joie, Current/Elliott and The Kooples.
Lever Style executive chairman Stanley Szeto told Sourcing Journal that he expects those brand relationships to continue without a hitch, and now the Hong Kong firm will be able to offer premium denim to its existing clients.
While Lever Style has acquired Delta’s “customer base, technical know-how, and track record,” the manufacturer will not take ownership of Delta’s factory in Vietnam. Instead, Szeto said, his company prefers to operate on an “asset-light” model, outsourcing production to its acquirees’ existing facilities. The Delta operation employs between 600 and 800 workers.
But in Szeto’s estimation, Lever Style’s “capacity is basically limitless” because of its business model, which involves outsourcing to different factories, in different regions, depending on demand and trade implications. “If we run out of capacity, we just develop more capacity with other factories,” he said. “And on the other hand, if let’s say business is bad,” as it was during the early days of the Covid crisis, “then we can shrink our footprint quite easily.”
In August, Lever Style bought out Dongguan, China-based Vista Apparels, a small knitwear company specializing in sweaters for brands like James Perse, Ministry of Supply and Paul Smith. And later that month, the company acquired performance apparel manufacturer Liwaco Overseas Marketing Limited, which has made its mark in the industry producing gear for brands like Mammut, Mountain Equipment Co-op and Helly Hansen.
Lever Style aims to continue to expand both its geographical footprint and its expertise as a means of offering its clients access to “a network of strategic sourcing partners, each equipped with unique capabilities spanning a range of product categories,” Szeto told Sourcing Journal in October. This week, he also said that offering more capabilities to customers saves them the administrative hassle of maintaining relationships with multiple suppliers in different markets.
And as shoppers’ appetites continue to lean toward ultra-wearable, at-home staples in light of the continued spread of the coronavirus, Szeto expects to see athleisure and performance apparel maintain an important role at retail. The company is actively examining options in the athleticwear space as the months spent at home wear on, he noted.
“All of these acquisitions are pretty small,” Szeto said, “but they all have very interesting capabilities that we think could be very attractive to our customers.”