P.J. Salvage hired Simon Cohen as president in November, the first shift in top management at the Irvine-based apparel manufacturer since Peter Burke bought it out of bankruptcy in 1997.
The appointment follows a 2015 deal with Delta Galil Industries Ltd. in Tel Aviv to acquire P.J. Salvage for about $41 million, which includes a $3.75 million payment that’s contingent upon profit milestones set for 2016 and 2017.
Burke continued serving as chief executive after the sale closed while searching for a successor.
“The founder of a company knows his business intimately—every department—and to find someone who understands (everything) from creative to finance to back end to sales is very difficult,” said Burke, who now chairs the company’s board of directors.
Cohen, an apparel industry veteran with background in product development, marketing, retail, international distribution, branding and e-commerce, checked off numerous boxes on Burke’s list.
“I’ve done almost every function in the apparel brand that you could do,” Cohen said.
He joined his father’s company, Michael Stars in Hawthorne, in 1994 when the apparel brand had five employees.
He left 13 years later after establishing its retail arm and serving as the company’s president.
“We had a tremendous run,” Cohen said. “It reminds me a lot of P.J. Salvage—a contemporary, family-owned business that’s very protective of their brand and of their distribution channels.”
He co-founded lifestyle apparel brand 291 from Venice Inc. with his wife in 2007, and in 2012 he joined WWA Advisors LLC in Salt Lake City as senior executive consultant. His duties included “strategic planning for Darlington Fabric, Helmut Lang, Kaltex Apparel, theory and Vans.” After a brief stint as interim president at Wildfox in Los Angeles, in 2014 he joined Brand Cnslt in Venice, a consulting firm that helps “brands define—and redefine—who they are by delivering actionable, measurable results through informed strategic initiatives built on decades of experience, insights and expertise.”
His approach for P.J. Salvage is to “continue the great legacy that’s taken Peter 20 years to build.”
Cohen said, “The apparel industry is a really tough industry, and he’s done an incredible job of positioning the brand.” He added that he plans to highlight the company’s heritage “through marketing and social media efforts, and enhancing the imagery and the branding so it’s more recognizable.”
More in Store
The apparel manufacturer made its name by offering high-quality sleepwear for women. About seven years ago it expanded its merchandise lineup to include loungewear, and more recently lifestyle apparel—cozy sweaters, sweat pants and shorts that pair well with flip-flops for the morning run to Starbucks.
“We go from bed to brunch,” he said. “For fall ’18 we have some beautiful loungewear pieces that definitely can be worn outside.”
P.J. Salvage products, which also include home goods and accessories, are sold at Nordstrom, Bloomingdales, Lord & Taylor, Amazon and Zappos. Its wholesale network includes 1,200 boutiques in the U.S. and another 250 in Canada. The company, which employs about 30, also operates via a distributor model in Australia, Japan, Korea, Mexico, India and some 15 countries in Europe.
“We really control our distribution … profit drives us more than sales,” Burke said, adding that continuous product differentiation and keeping up with current trends in the fashion industry have helped P.J. Salvage remain relevant to the 30-something female consumer it’s targeting.
Burke and Cohen declined to disclose the company’s revenue. Israel-based daily newpaper Haaretz pegged it at $25 million at the time of sale.
Delta Galil, which in 2016 picked up Splendid, Ella Moss and 7 For All Mankind for about $120 million, has been a silent partner so far, allowing the brand management to operate independently. The relationship, however, provides several benefits of scale, including access to more factories in China and a warehouse in Fontana, from where P.J. Salvage plans to ship to its department store accounts, according to Burke. The rest of the distribution is done from its warehouse in Irvine, which is adjacent to its 42,000-square-foot headquarters. Last year the retailer ranked No. 34 on the Business Journal’s list of apparel companies based in OC.
Cohen sees “big opportunity” to expand the company’s presence in Europe and Asia, and enhance branding, marketing and social media efforts.
“If you have an amazing product and consumers who have an amazing relationship with that product, it’s just how you enhance that and tell that brand story so that more people [become] stakeholders in the brand,” he said. “The other components are already there—the hand feel is there, the product is there, the price is great, and it’s a well-run company.”
He also said “there’s so many great collections the brand has that could support a retail environment,” such as pop-up shops to temporary locations that would not compete with its wholesale accounts.
“Our retailers are our strength,” Burke said, adding that its own stores would be more about “introducing the brand versus selling.”
