Yarn House Rules

All fashion industry eyes are on Vietnam where the seventh round of the Trans-Pacific Partnership (TPP) trade negotiations are taking place this week.

Reps from nine countries, including the U.S., have gathered in Ho Chi Minh City in hopes of coming to an agreement on a trade deal before the Asia-Pacific Economic Cooperative (APEC) meeting in November.

Fashion industry execs are paying close attention to the U.S. stance on textile and apparel import issues, particularly the rule of origin:

Importers plan to push negotiators in Vietnam for a “flexible” rule of origin that does not restrict where the fabric and yarns are made in order to qualify for duty free benefits. The rule-of-origin debate has pitted apparel importers against the U.S. domestic textile industry, which is advocating a “yarn forward” rule of origin that would require apparel to be made of fabric and yarn supplied by the U.S. or the other TPP partner countries.

“When you have a rule that is more restrictive and burdensome, it discourages trade and investment from occurring,” said Steve Lamar, executive vice president of the American Apparel & Footwear Association, who will also be in Vietnam this week, adding that AAFA member companies often use U.S. yarn and fabric and forgo duty free benefits in other trade deals because the rules are so burdensome.

But a yarn forward rule is a linchpin for U.S. textile industry support.
A bipartisan group of 52 House lawmakers, many from traditional textile states, recently sent a letter to U.S. Trade Representative Ron Kirk making their support of any deal contingent upon a yarn-forward rule of origin, exclusion of certain products from tariff reduction or elimination, tariff reductions for specific sensitive imported products versus phaseouts for groups of products, and strong customs enforcement language to prevent transshipments from China.

“It makes no sense in our opinion to disenfranchise textile producers in the U.S. so Vietnam [a nonmarket economy that subsidizes its exports] can source product components from China and ship products to the U.S. duty free,” said Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition. “What we know is that the yarn forward rule of origin will create an environment that gives support to expanding our export markets.”

And The Winner Is......

Last night, Alice Tully Hall in Lincoln Center served as the location for the Oscars of the fashion industry, the 2009 CFDA Fashion Awards. Each year, the Council of Fashion Designers of America (CFDA) gather to honor the best and brightest in the fashion industry. Comedian Tracey Ullman served as host of this year's ceremony.

This year's award was about embracing fresh, new talent, with newcomers Kate and Laura Mulleavy of Rodarte, Scott Sternberg of Band of Outsiders, Italo Zucchelli for Calvin Klein and Jack McCollough and Lazaro Hernandez of Proenza Schouler taking the top awards.

First Lady Michelle Obama made an appearance via taped message to accept the Board of Directors' Special Tribute Award for her support of fashion designers. Ralph Lauren won the Popular Vote Award, a new award sponsored by L'Oreal Paris which allowed the public to vote for their favorite fashion designer at WWD.com.

Below is a complete list of the winners and honorees:


Womenswear Designer of the Year: Kate & Laura Mulleavy for Rodarte

Menswear Designer of the Year (tie) : Scott Sternberg for Band of Outsiders and Italo Zucchelli for Calvin Klein Collection

Accessory Designer of the Year Award: Jack McCollough & Lazaro Hernandez for Proenza Schouler

Swarovski Award for Emerging Talent Womenswear: Alexander Wang

Swarovski Award for Emerging Talent Menswear: Tim Hamilton

Swarovski Award for Emerging Talent Accessory Design: Justin Giunta for Subversive Jewelry

Geoffrey Beene Lifetime Achievement Award: Anna Sui

International Award: Marc Jacobs for Louis Vuitton

Eugenia Sheppard Award for Fashion Journalism: Edward Nardoza, Editor-in-Chief, Women’s Wear Daily

Eleanor Lambert Award: Jim Moore, Creative Director, GQ

Popular Vote Award: Ralph Lauren

Board of Directors’ Special Tribute Award: First Lady Michelle Obama

(SOURCE: CFDA.com)

Amen, Anna!

Anna Wintour gets it.

In a recent interview with The Wall Street Journal, the editor of Vogue magazine breaks down what is wrong with the fashion industry:

WSJ: If fashion is a barometer of the prevailing mood, what can we expect to see for fall 2009?

Ms. Wintour: It is so important for designers not to run scared, and not to be too worried about what's safe and what's commercial.

Right now, what's going to work is something their customer doesn't have in her closet and that has a real intrinsic sense of value. …Because to be honest there's been too much product, too much copy-catting, and, probably too much consumerism. I think a sense of clarity, a sense leveling off and a sense of reality is needed.

BINGO! Designers have turned into expensive versions of H&M, focusing solely on short-term trends instead of long-term value. I'm not saying that trends should be ignored, as there are still some who can afford to acquire expensive "It" items. However, that isn't true for the majority who want value, so there needs to be a mix of trends and timeless classics.

People are willing to pay full price for high-end labels, provided the pieces are high quality, exclusive and are fashionably durable, meaning that 10, 20 years later the pieces aren't dated. Hermes and LVMH are indicative of that. While other companies in the fashion retail sector posted losses, LVMH reported a fourth-quarter sales increase of 4%, and Hermes reported 2008 sales rose 8.6%, exceeding analyst forecasts.

Sorry, but you can't design any ol' garment, slap a famous name on it and expect it to sell in today's economy. The sooner designers realize this, the better off they will be.

Peter Som Parts with Creative Design Studios, Cancels Fashion Show

Another retail marriage has dissolved.

Women's Wear Daily reports that Peter Som and Creative Design Studios, a subsidiary of Lord & Taylor LLC, have decided to part ways, undoubtedly due to the economic crisis that has delivered a major blow to the fashion retail industry. As a result, Mr. Som has cancelled his Fall '09 show for NY Fashion Week.

“We have realized that our strategic interests are no longer aligned and feel that this is the best direction for our company at this time,” said Som. “While these are challenging times for luxury brands both small and large, it’s an opportunity for us to reshuffle our deck of cards. I remain creatively inspired and am looking forward to exploring opportunities where we can grow with the right partner, or on our own.” (Source WWD.com)

NRDC Equity Partners, the parent company of Lord & Taylor, created CDS in 2007 with the purpose of working with American designers. They made an initial investment of $10 million in Mr. Som for a two-thirds stake in his company.

“Peter’s talent is enormous but the realities of today’s marketplace have forced us to reevaluate all of our strategic partnerships,” said Susan Davidson, ceo of CDS. “We need to focus all of our resources on our core businesses — Lord & Taylor and The Bay department stores.” (Source: WWD.com)

The last few months have been trying for Som. In Oct. '08, he left Bill Blass, due to lack of finances on the part of NexCen Brands, Inc., the parent of the Blass label. However, Elana Posner, co-owner of Peter Som Inc. remains optimistic, exploring options for the fall.

Here's a thought: Now that Peacock International Group is the new owner of the Bill Blass label, could Som give the Blass brand another shot?

Bill Blass Couture Files For Bankruptcy

The economy is beginning to take it's toll on the high-end fashion industry. The first victim -- Bill Blass Ltd:

The company filed a Chapter 7 bankruptcy petition Wednesday with the U.S. Bankruptcy Court in Manhattan, listing assets of $192,000 and debts of $829,000, court papers show.

The company halted operations last week because it "did not have the financial wherewithal to continue," according to its bankruptcy attorney, Harold S. Berzow of Ruskin Moscou Faltischek P.C. ......

The bankruptcy petition shows the company has $11,250 in miscellaneous assets, including office equipment, $25,000 in inventory, about $90,000 in its bank account and $155,361 in accounts receivable..... (Source: WSJ.com)

This shouldn't come as a surprise. Just before Christmas, NexCen Brands Inc., the parent company, sold its Bill Blass licensing business to Peacock International Holdings LLC for $10 million to pay off debt, and laid off 60+ workers without severance pay.

The question is, Can Bill Blass recover? Here's some advice from former Blass head designer, Michael Vollbracht:

“You need the Blass DNA – it’s crucial,” says Mr. Vollbracht, who also was a personal friend of Mr. Blass’s. “You need to make good, classic clothes for women who don’t like fads. Bill Blass was not faddish.” (Source: WSJ)

I believe they had that with Peter Som, but NexCen couldn't afford him thanks to a $30 million debt they acquired to purchase Great American Cookie. Who knew a lil' ol' chocolate chip cookie would help bring down a fashion empire?

But there's hope. Peacock, with annual sales of $70 million, has plans on reviving the brand "within 9-12 months".

The new owners of the Blass trademark and its nearly 20 licenses plans to focus first on getting its licenses “on the same page – the brand identity is a little uneven,” Scott Patti says. “We’re very intrigued by the international business opportunities of the Bill Blass brand – we believe NexCen hasn’t even scratched the surface of that worldwide.” When asked about the potential for the brand, he notes that the Blass brand once did sales of $500 million annually. (Source: WSJ.com)

Stay tuned........

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Like any fashionista, I LOVE talking about fashion and beauty: the latest "It" bag, the hottest up and coming designers, the new must-have lip gloss.....etc.

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