The times, they surely are changing, and G-III Apparel Group is changing with them.
The multibrand manufacturer, marketer and licensee has seen the movement toward casual dressing develop in recent years and accelerate through the coronavirus pandemic’s work-from-home and get-outdoors effects and has reacted quickly to the trends.
Morris Goldfarb chairman and CEO of G-III, told analysts on a conference call to discuss second quarter financial results that while the company’s product categories had been evolving toward more casual dressing over the past several years, “our teams were able to move rapidly to further change our fall and holiday seasons product assortments to address the clear shift in consumer needs.”
Call for casual
Goldfarb said the demand for performance or athleisure is accelerating, and G-III’s recently added jeans lines for DKNY, Calvin Klein and Tommy Hilfiger “lend themselves perfectly to today’s casual and active lifestyle.”
“From their initial launches, we designed these lines to have a ratio of multiple tops to one bottom,” he said. “Our focus is on casual and comfortable Ts, woven tops, sweaters and sweatshirts. We have also added an assortment of relaxed bottoms, leggings and casual pants in a variety of fabrics. Overall, with three of the most globally recognized power brands–DKNY, Calvin Klein and Tommy Hilfiger–we’ve become the dominant resource in athleisurewear. We expect the athleisurewear and jeans category to be a big growth area for us going forward.”
Goldfarb said G-III has built a strong essentials program that allows the company to replenish quickly to facilitate demand in stores, as well as digital. He noted that coats are another area of opportunity.
“We are seeing a greater demand for coats based on a…growing interest in an active lifestyle and outdoor activities, including walking, running, biking, hiking and dining,” Goldfarb said. “To meet this demand, we’ve expanded our offerings of traditional mid-weight styles, packable jackets and layered pieces, all designed for comfort and functionality.”
As for sportswear, for the fall and holiday season, G-III is emphasizing the casual components of these collections, featuring knit and woven tops and sweaters, as well as casual, comfortable dresses and bottoms.
“On the flip side, we have deemphasized categories like suit separates, the carrier components of our sportswear lines and social dresses,” Goldfarb said. “The athleisure area clearly has become a way of life. It’s a way of dressing today. I don’t know the last time I really saw a tie, but nobody is wearing ties. Nobody is wearing nested suits to work or to go out to dinner or to sit around the house and do what they do, do their business or workout…So the athleisure side of our business is growing very rapidly.”
The newly licensed CK Jeans for women from PVH “has done incredibly well,” he added.
“Our formula for success is a multiple of tops compared to bottoms,” Goldfarb said. “So there are cut-and-sew knit tops, there’s a ton of amazing T-shirts that coordinate with pretty much everything a woman wears. That’s worked very, very well in CK.”
Early holiday conundrum
Goldfarb also discussed the call for early holiday selling this year and how that could be a problem due to shipping and logistics issues, as well as low inventories.
“We’re a little bit at the mercy of our sourcing structure on product flow, as we stopped production for a period of time and restarted,” he said. “That doesn’t give us free mobility as to how we flow product. And there are some issues on container space as well coming out of several countries. So, we’re eager to get our product in. We believe that holiday will come early and we will have the opportunity to ship earlier than ever for a holiday product.”
Goldfarb said he believes there is a shortage of inventory in the industry, contrary to some popular belief of excess due to slow selling, and “as you shop stores, you can clearly see that.”
In reporting net sales for the second quarter ended July 31 declined 53.8 percent to $297.2 million, with a net loss of $15 million, the company said its inventory levels were down about 32 percent compared to last year.
“We don’t have the luxury of being perfect on what the retailer is going to demand, but we’re going to service it to the best of our ability,” he added. “If we can get our products here earlier, I believe we’ll be able to ship it earlier.”