MOSS ADAMS CAPITAL: Apparel and foowear market monitor highlights notable deals, stock prices and results.
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Sole Technology is putting its brand éS on hiatus, Sole Tech owner Pierre André Senizergues told me in an interview today.
He said the move will make the company more efficient and allow it to devote more resources and focus to Sole Tech’s other brands: Etnies, Emerica, Altamont and ThirtyTwo.
“It’s a very complex market right now - there are a lot of brands, and a lot of pressure on the market,” Pierre said. “We feel it's the time to simplify things.”´The éS Accel shoe
És was founded 16 years ago, and offered a skate shoe with a more athletic aesthetic, sophisticated materials and higher price points. It debuted in the 1990s, when the skate market was very different. Currently, it is Sole Tech’s second smallest brand, ahead of Altamont, a skate apparel brand launched five years ago.
Sole Tech will deliver éS product through Spring 2012. Then the brand will go on “creative retreat,” Pierre said.
“At the end of the day, it’s about being ready with the dynamic of economy, being focused and pushing what’s the best,” he said. “And what needs adjustment, you put back in the garage and retool it before relaunching it at the right time.”
As a result, some employees were notified today they are losing their jobs. Pierre did not want to give a specific number, but said less than 20 positions are being eliminated. Sole Tech employs approximately 400 people worldwide.
“It’s always heartbreaking,” Pierre said. “We love the people we work with, we hire them because we believe in them and want to give them a great future. It’s a tough call to make but feel it’s one we have to make at this moment.”
Sole Tech will honor the éS skate team contracts, Pierre said.
In more positive news, Sole Tech’s other brands are seeing bright spots.
Etnies is seeing good demand for its men’s product and seeing “good growth,” Pierre said.
Emerica is performing “extremely strong,” and early spring bookings are up 49%. The brand’s Chillseeker hanging shoe line is “exploding” and the company wants to fuel that fire, he said.
And at ThirtyTwo, both boots and the brand’s newer outerwear line are doing well. Pierre is also quite pleased that ThirtyTwo will deliver on time this season, not an easy feat with the difficulties in China.
Sole Tech also wants to focus more on its apparel line Altamont, which is growing double digits every year. Pierre sees a lot of opportunity for the brand because it offers something different in the market.
While the dynamics of the market have changed, especially with the large conglomerates entering the space who “see it from an accounting perspective rather than from the passion of riding a skateboard, or surfing, or snowboarding,” Sole Tech is proud that it is still independent and is all about skateboarding, he said.
“We were born in skateboarding, we were born in the action sports industry, and we are doing it because we love it,” he said. “Being private has allowed us to be very authentic and share the passion, and it’s been a real one.”
I asked Pierre just how hard it is to compete in today’s market against better-funded, larger companies. Pierre is the sole owner of the company and says he has no plans to bring in outside investors.
“It is hard – it would be easier to do it like everyone else is doing it I think,” he said “But we want to stay real and pure.”