In focus: Surf, Swim, Streetwear and Accessories
Is swimwear recession-proof? Seafolly’s recent experience would certainly say so, although as in all clothing sectors the true situation is hard to gauge. Kate McDonald reports.
Australian swim and surfwear designers and manufacturers have long played on our sun-kissed, sand-filled reputation to market their wares, and the iconic brands of Speedo, Billabong and Quiksilver are testament to the value of that image.
While two of those names are no longer locally owned, swim and surfwear is probably still the major category promoted as an Australian success story for our local industry to overseas markets.
So iconic is the Speedo brand, the Australian Maritime Museum in Sydney is currently holding an exhibition dedicated to the evolution of the modern swimsuit. ‘Exposed! The story of swimwear’ explores how the development of Australian popular culture can be traced by what people have donned for a trip to the seaside, from Annette Kellerman’s coveralls in 1910 to Peter Travis’ infamous Speedo budgie smugglers, first created in 1960.
Fifty years of budgie smuggling will also be celebrated next year by textiles manufacturer Invista, creator of Lycra, which at this year’s Miami Swim held an homage to half a century of innovation in swimwear fabrics and fibres by showing style evolution from the 1960s to the current period.
So in current times of economic crisis, but with the smell of summer in the air, how is the local swimwear industry faring? Fantastically well, according to Anthony Halas, CEO of Seafolly.
“The start to this season has been unbelievable,” Halas says. “And that’s not just Seafolly but the swimwear market in general. The weather’s been good – and that’s a big factor – but in general, having spoken to some of the big retailers in Australia, retail at these upper levels is very buoyant at the moment.”
Jo Kellock, executive director of the Council of Textile and Fashion Industries of Australia (TFIA), is more cautious, however. “From my information, I haven’t heard any rumblings that [swimwear] is doing worse than any other sector,” she says. “The people that seem to be in trouble are those who are on thin margins and are squeezed in the supply chain. I don’t think there is anything unique in terms of the swimwear market itself.”
Halas is incredibly positive about the coming season, however, and perhaps he should be. Seafolly had an excellent show at Miami Swim in July and is in the middle of its third season in the US market, which is developing nicely for the Sydney company.
“It has been a mix,” he says about the northern hemisphere summer. “From the Seafolly standpoint it has been very positive. We are having a huge increase in the northern hemisphere in general but in the US in particular, as it is a new market for us. There are terrible retail signals [in the US], but we are getting results.”
In fact, Halas is so positive he believes swimwear is recession-proof. “Our theory has always been that swimwear is resistant to recessions,” he says.
“That’s something we’ve always experienced but we hadn’t seen anything quite as bad [as this recession] in the past. But we seem to be very buoyant in down times. That was our expectation and it has held true.”
Kellock says this is a big call. “Once again I go back to the individual operators within the sector and my experience is that it doesn’t matter who you are within that product category,” she says. “If you haven’t prepared as you needed to and taken quick action in the current environment, then you are putting yourself at risk. It is about managing risk in the current environment, and my advice in that sense is that none of us is immune.”
Limited edition
Seafolly certainly seems to be taking somewhat of a risk, but Halas is so positive that he is pushing his company full-steam ahead. It has opened two more stand-alone Seafolly flagship stores recently – one at Pacific Fair on the Gold Coast in July and one at Melbourne’s Chadstone in August – to add to the first at Chatswood in Sydney, which opened last year. He plans on a total of six stand-alone stores in Australia but is also investigating opening overseas stores, the first one probably in Dubai.
And Seafolly has taken a leap this year with a limited edition collection. Not something that is common to a middle-market manufacturer like Seafolly, the new limited edition will retail for between $200 and $300 and will have only 100 pieces per style. “We were getting a lot of feedback from consumers, from friends, from all sorts of people who love our products but felt they wanted something a little more exclusive,” he says.
“And they were happy to spend a little more money than they would for an average Seafolly swimsuit. They wanted to feel that they were the only ones around with that piece.”
Halas doesn’t expect to earn a fortune from the collection but that is not really the point. It will make a profit but it has also made a splash, gaining excellent coverage in the consumer media and a lot of expectation from those wanting a piece of the collection. It will go on sale in eight David Jones stores and the three Seafolly stores, as well as one or two other selected boutiques, in the middle of September. He expects the collection to sell out almost immediately.
The limited edition collection is certainly an excellent idea coming into the peak swimwear season for Australia, which Halas expects to be very good, although he can’t pinpoint exactly why. “No one can explain it but maybe people have been hanging on to their money for a long time and suddenly the papers are more positive, people are feeling more positive, and they are starting to spend their money. August has been an incredible retail month in general, from what I’ve heard.”
Product categories
The exact value of the Australian swim and surfwear sector is hard to gauge, as statistics are hard to come by, but the sector is reasonably healthy and is expected to grow, according to IBISWorld analyst Raghu Rajakumar. “Swimwear is a very small sector so we don’t have import [figures] of swimwear on its own,” he says. “The Australian Bureau of Statistics includes it as a sub-sector of sleepwear and as part of intimate apparel.”
That sector was worth about $477 million in 2007/08, and is expected to grow by about one per cent per year, he says. The Department of Foreign Affairs and Trade, on the other hand, includes swimwear with tracksuits and ski suits when it comes to exports, which it values at about $20 million in 2007. Exports are expected to grow strongly, however: IBISWorld expects the sector to grow by about 3.9 per cent in the next few years, Rajakumar says.
So apart from playing on the sun-kissed image, how does an Australian brand crack overseas markets? Exports make up 60 per cent of Seafolly’s business, Halas says, but all markets are different. His product sells in 40 countries worldwide, with 50 per cent taken up by the UK, Canada and Germany. Small European countries are also strong, with the Netherlands, Switzerland and Norway proving nice little earners for Seafolly. (Do Norwegians buy swimwear? They certainly do, he says. The Scandinavians are great travellers.)
For the daunting and cluttered US market, Seafolly has taken the same tack as in Europe: do a public relations blitz, have a presence at the trade fairs and, most importantly, establish a solid reputation. It’s not rocket science, he says.
“We employ good agents, we have a presence at the major shows and we find each year people coming to our stands having heard of us from retailers. Then the momentum picks up.”
While it is easy to imagine the major US swimwear states of California and Florida would have a lot in common with Australian beach culture, Halas says this is not so. “I find that swimwear in America is very heavily categorised – there are all sorts of categories and every single brand has to fit into one.”
The junior category, for instance, often follows the trends of older age categories in terms of colours and look, but doesn’t appear to take into account the fact children and tweens don’t particularly want to wear the skimpy styles aimed at young women. “We do special fit, helping to enhance their body shapes but to cover up all of those bits they don’t want to show. We don’t fit into one category – we cross over.”