Z Supply LLC’s latest offering is a nod to Orange County’s apparel industry heritage.
It licensed vintage designs by Ocean Pacific Apparel Corp. and Gotcha International to develop women’s collections sold exclusively through the Urban Outfitters retail chain.
The line is part of Icons of Culture, Z Supply’s sixth brand, which includes designs inspired by legendary musicians, artists, TV shows and movies. It’s also a cog in a larger effort to help the Irvine-based company continue 50% annual sales growth.
“It really comes down to how do we get to $100 million,” said Chief Operating Officer Heidi Muther.
Z Supply has 60 employees and about $50 million in annual revenue, according to a Business Journal estimate. E-commerce, launched in 2015, accounts for about 10% of sales volume.
“We are looking to grow it to 20%,” said Muther, who joined Z Supply after stints with Irvine-based St. John Knits and Billabong USA.
The company’s brands, sold at about 4,000 boutiques and specialty retail chains, include Black Swan, Others Follow, White Crow, Rag Poets and namesake label Z Supply. Each caters to a different consumer. Others Follow skews the youngest, in the 16-to-22-year-old range, with beach-inspired looks. White Crow aims for 18- to 25-year-olds, usually college students or young moms. Black Swan’s after a “refined, romantic woman” who’s 25 to 35, while Rag Poet speaks to those 30 to 45. Z Supply, comprised of mostly comfy fashion basics, is for all, including numerous celebrities who’ve adopted the label as a daily must-have.
Muther’s team, to get to $100 million, is expanding apparel categories to include more dresses and bottoms. It also will launch swimwear and men’s lines next summer, the latter under the Z Supply brand line, which accounts for about half of total sales volume.
Z Supply’s inaugural retail effort kicks off this month with a shop-in-shop concept it developed with Laguna Beach-based Sunny Days. The retailer has five boutiques, including Balboa Island and Orange locations, which will feature an expanded offering.
“We will build a mini Z Supply—basically what our boutique will look like one day, but in the [Sunny Day] store,” Muther said. “This is a great way to create a whole assortment in a store and control it for a while. Once we learn what [works], we can start expanding this.”
Roots
Greg Garrett, who served as executive vice president at Gotcha and worked as the surf-shop sales representative for Ocean Pacific, co-founded Z Supply in 2013 with Glen Reder and John Zhao. Zhao’s brother owns China-based General Textile and Garment Co. Ltd., a large apparel manufacturer that helped Z Supply make it through the first 18 months—it took on relatively small production runs for the then-startup as opposed to the “high minimums” required by other manufacturers.
The close relationship has enabled Z Supply to ship merchandise in 60 days today compared to the industry standard of 120.
“Part of our success is the ability to manage our inventory and fill customers’ orders,” Muther said. “We even stock goods here.”
The company’s first employee was Design Director Corin Lopez, who previously worked as vice president of design and merchandising at BB Dakota and oversaw production and merchandising for surf brands Rusty, Gotcha and Redsand. Recent hires include Kristine Van Galder, who oversees sales and merchandising for the Icons of Culture graphics collection, and Director of Sales Tony Sanchez, who served in similar roles at Fox Head Inc. in Irvine and Pacific Sunwear of California Inc. in Anaheim.
Z Supply’s array of brands “incentivizes” its sales force to go on the road to showcase new collections.
Some retailers attend trade shows, but “you have to do the road to survive in the boutique world,” Van Galder said, adding that nearly all “accounts” carry more than one label. “We give them enough ammunition, and it makes sense to spend that time out of the office.”
She sees Icons of Culture spilling over to other labels, as today’s consumer is looking for a vintage look and likes to support local businesses.
“Main Street thrives, especially in college towns,” she said. “It’s about finding that one thing that no one else has.”
Director of Marketing Beatrice Rosu, meanwhile, is in charge of “telling the story” of Gotcha and Ocean Pacific so younger fans “can understand the throwback part of it.”
Licenses
Garrett got an 18-month license for Gotcha from Perry Ellis International Inc. and struck a similar deal with New York-based Iconix Brand Group Inc. for Ocean Pacific. Future collaborations will depend on how well the current collections are received.
“We take a lot of risks, but it’s all calculated risk,” Muther said. “We have to see the results at Urban first. If it does well, then we’ll roll it out to other places.”
The throwback idea initially included another OC legacy brand—Hang Ten—which Duke Boyd started in 1960 and where Garrett started his career. That didn’t work out.
“I couldn’t get Hang Ten because [La Jolla Group in Irvine] got them,” Garrett said. “It’s distributed (almost) exclusively to Costco.”
