Apparel Makers Post Mixed Job Results; Surf Hot
By JENNIFER BELLANTONIO
This past year saw more of the same for Orange County’s largest apparel makers.
A number of action sportswear makers propped up local employment, while an industry slowdown played out at others.
The 25 largest OC-based apparel companies ranked by employment posted a 1% gain in jobs here in the past year, according to this week’s Business Journal list.
The companies, which design and make everything from bathing suits to business suits, added just 52 jobs to 10,180. Four companies didn’t give figures and were estimates. Last year’s list showed a 4% gain in jobs.
Companies tied to OC’s action sports scene, including No. 4 Huntington Beach-based Quiksilver Inc. and No. 6 Billabong USA, the area’s two biggest surf brands, helped drive gains.
But their increases were offset by other businesses that pared back their OC presence amid stiff competition and rising operational costs.
For instance, No. 23 Rancho Santa Margarita-based Point Conception Inc., No. 24 Irvine-based Snowmass Apparel Inc. and No. 25 Orange-based National Headwear shifted some of their production operations outside the county or to cheaper Asian manufacturers in the past year.
“Our volume is doing better because we’re doing a lot of work offshore,” said National Headwear Chief Executive Randy Hirschfeld. “We had to do that.”
In all, 10 companies posted employment increases, five saw no change and six reported a dip.
Some good news for apparel makers: The retail picture is showing signs of life.
Most retailers were pleased with their back-to-school performance, said Tony Cherbak, a retail analyst in the consumer products group at Deloitte & Touche LLP’s Costa Mesa office. And Cherbak is optimistic about the upcoming holiday season.
“If you look at retail and consumer spending, you’re starting to see some signs of life,” Cherbak said. “You’re going to probably see retail sales increases of somewhere between 4% and 6%.”
On a national level, some retailers are faring better than others, and that same scenario played out locally in August.
For instance, Anaheim-based retailer Pacific Sunwear of California Inc. reported a 15.6% same-store sales increase in August, while Foothill Ranch-based Wet Seal Inc. posted a 10.7% drop.
Perennial No. 1 Irvine-based St. John Knits International Inc. led again with 2,636 OC workers, down 2% from last year.
The upscale women’s clothier has been upgrading production gear and reducing staff through attrition in “certain areas where productivity gains have been achieved,” according to Bruce Fetter, co-chief executive.
“We are continually focused on working smarter and the results have allowed us to accomplish more with fewer people. Every position that becomes open when someone leaves is looked at carefully to determine whether we should replace or consolidate functions instead.”
Last year, Robert Gray, former chief executive, retired and his daughter, Kelly, the company’s signature model, and Fetter, former co-president, took the reigns as co-chief executives. Kelly oversees advertising, merchandising, product development, sales and retail. Fetter handles manufacturing, finance, real estate and administration.
Earlier this year, St. John opened a store in Vancouver, British Columbia, and plans to open a boutique at the Venetian hotel in Las Vegas in November. It’s also close to signing a swimwear agreement with No. 5 Tustin-based Raj Manufacturing Inc. and plans to test children’s apparel in its boutiques during the holidays.
No. 2 Foothill Ranch-based Oakley Inc. posted a 1% gain in OC workers to 1,625, mirroring the list’s trend. The apparel maker continues to push newer products (shoes, clothes, prescription glasses and watches), which represent more than a quarter of sales.
Irish Lens Plant
Oakley has been building its women’s apparel business, revamping and increasing the line and adding staff. Last year, it also built a 10,000-square-foot prescription lens finishing lab in Mullinger, Ireland, and hired 25 workers in a bid to grow its prescription eyeglass business.
At No. 3 was Anaheim-based Alstyle Apparel & ActiveWear Manufacturing Co. with 1,600 workers, an estimate. The company declined to provide figures.
Earlier this year, the privately-held company cut an undisclosed number of workers when it closed its local sewing operation and shifted the work to a bigger production facility in Chicago and plants in Mexico, Honduras and El Salvador.
As part of the move, the apparel marker moved some of its warehouse and corporate operations to a larger 200,000-square-foot facility at 1501 Cerritos Ave.
Alstyle makes T-shirts, sweat shirts, pants and shirts for names such as Nike Inc. and Gap Inc.’s Old Navy. Plus, it designs and produces its own sportswear and T-shirts under brands such as Murina, Hyland and AAA.
Quiksilver took the next spot on the list with a 7% gain in OC workers to 1,350. The surfwear apparel maker is tracking to hit $1 billion in yearly sales this year (sales for the 12 months ended in July were $905 million).
The company’s other moves included expanding its entertainment arm and teaming with Glorious Sun Enterprises to open stores and boost distribution in China.
Earlier this year, Quiksilver signed two leases valued at $6 million to take on an additional 200,000 square feet in Huntington Beach to house screen-printing operations, store blank T-shirts and production. The company’s Surf City campus is now about 700,000 square feet.
Other gainers included Billabong, which saw a 28% jump in OC workers to 320. The apparel maker added staff in various departments, including its junior’s line.
No. 8 Sole Technology Inc., which reported a 22% boost in workers to 220, is readying to open its new 38,000-square-foot lab, the Sole Technology Institute, to study and test the biomechanics of skateboarding. The company, which sells shoes and clothes under the Etnies and Emerica brands, also opened an 80,000-square-foot warehouse across from its main campus for shoe inventory.
No. 9 Costa Mesa-based Hurley International LLC saw a 12% jump in OC workers to 200. The apparel maker, owned by Nike Inc., recently leased an 85,000-square-foot warehouse at 2900 McCabe Way near John Wayne Airport and is moving its product storage and shipping there from its 60,000-square-foot Costa Mesa headquarters.
The company plans to hire about 25 workers for the new warehouse. Hurley will use freed-up space in Costa Mesa for marketing and design.
No. 10 Anaheim-based AST Sportswear Inc. reported the biggest employee gain with an 83% jump in OC workers to 165. Chief Operating Officer Abdul Rashid said the company last year more than doubled the size of its headquarters to a 48,000-square-foot facility “to allow for our growth.”
Expanding Distribution
AST recently expanded distribution of its Bayside brand to other territories, including the East, Southeast and Midwest, Rashid said.
No. 17 Costa Mesa-based Paul Frank Industries Inc. posted a 43% spike in OC workers to 100. The apparel maker has been hiring staff to keep up with growth in sales.
Point Conception was among the decliners. The company reported a 25% drop in OC staff to 60 after shifting some local workers to fabric cutting facilities in San Bernardino.
No. 25 National Headwear posted a 50% drop in OC workers to 30.
Hirschfeld said the company, which makes fabric hats, moved 60% to 70% of its production to Asia.
“It’s very hard to do business in California,” Hirschfeld said. “My workman’s comp right now for my 30 people is substantially more than it was when I had 100 people three years ago.”
Snowmass’s OC staff dropped 43% to 40 after the company shifted its distribution and warehouse to Chino.
No. 15 C & C; Cos., which holds the license for Sanuk sandals and Rusty apparel, reported an 11% drop to 111. President Donald “Dac” Clark said the reduction was due to “overall increases in staff productivity” and shifting domestic production offshore. C & C; recently relocated to bigger digs in Irvine.
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