Starting up a clothing business during an economic downturn is a challenge. These days having experienced navigating the tumultuous foreign exchange, commodity markets and consumer spending obstacles is probably of more use than years spent in fashion design school!
Designer Cody Ross is one of those former hedge fund guys who got out of the financial business at just the right time and is now using that business acumen to help launch his true passion--design house Priestess.
Ross started Priestess two years ago and sells at boutiques in NYC and Shanghai. The ‘Kitschy, Punky, Futuristic’ collection (Ross' description) is a line of dresses, jackets, jumpsuits and other versatile pieces made for layering and constructed of silk-blends, wools, soft jerseys/cottons. The line is downtown chic inspired by designers Rei Kawkabo, Raf Simmons, Jeremy Scott, Bernard Willhelm and Junya Watanabe.
While Ross designs out of his West Village studio, most of the Priestess line is manufactured in China. Recently though Ross has moved some sourcing to Vietnam. The same rising labor costs that are increasing the price of business for toy manufacturers are also inflating prices for apparel companies and design houses.
Ross says that labor costs are causing 10-15 percent price inflation. While designers have the option of avoiding this increase by pushing sourcing to factories outside the major Chinese commercial hubs, Ross says he finds these cheaper alternative plants often lack the production knowhow and skill set.
More expensive clothing isn't just a story for high-ticket lines like Priestess. Consumers - expect pricier t-shirts, jackets and staples at your local Macy's , JC Penneys and other mainstream stores.
One retail executive told me recently that clothing price inflation can actually be a good thing for stores. Why? That higher-ticket means the store gets to register a bigger, more impressive sale when it comes to monthly same store sales results.
Also, the current level of price inflation simply means a small bump up in ticket price. Consumers won't trade down to cheaper stores when prices jump a few dollars. It is an entirely different story when the hike is significant (greater than 10-15 percent.) An interesting counterintuitive perspective.
Anyhow, check out Cody Ross' site at: www.priestessnyc.com.We'll be interested in following how his career develops.
Questions? Comments? retaildetail@cnbc.com