Most people managing an interview on the run from the backseat of a cab in Bali might seem a little frazzled, but if she is, designer Alice McCall doesn't show it. Calm, collected and succinct in her responses – she's in control. And, interestingly, when asked about why she recently opened up her first retail store, that's exactly what she answers.
“I wanted to have full control of the way my brand was represented to the public, and it was also critical for brand growth and brand identity,” she says.
“My label is seven years old now, so we had enough experience to understand what our brand is all about, so it was the right time to go vertical. I think there are a few key things you benefit from when moving into retail and the first is having complete control of your brand and the way it is merchandised, hence perceived, by the public.”
McCall describes her first store, which opened doors in September 2010 in Surry Hills Sydney, as low-risk – a strategy which she says contributed to the success of her first retail venture.
“Initially I wanted to test the market, so I ensured that my first retail store was low-risk by making sure that my overheads on the store, such as rent, weren't too high. I also didn't spend too much on the first fit-out as far as business goes. I spent enough, but our collection was so strong that I wanted it to be in an environment that was clean and reflective of the Alice McCall brand, and would allow the clothes do the talking,” she says.
The result has been high reward and McCall says that despite a soft retail market, the move into retail has paid off for the brand with minimal challenges.
“We've been exceeding budgets with our store, particularly in the first four months of operation, from September to January,” she says. “It did die off a little bit last month, which has been normal for retail in general, but as a whole, it's been successful for us.”
However, the benefit of broaching into retail for McCall has extended beyond financial gain, and she says one of the most valuable benefits gained from giving her business a physical shop front has been access to direct feedback from customers.
“Another key thing I'm learning since having gone into retail, is that you benefit from direct market research as to what products work and what products don't. Going into retail, gives you this information back about your product that really helps you with design. For example, what silhouettes work and what the customer feels that you don't have,” she says.
“You don't really get that with pure wholesaling when there are all the middlemen. You wouldn't really have a wholesaler ever say to you: 'I really feel like Alice McCall needs more bottom-weights, etc', because they have other labels that will do that for them.”
However, balancing her wholesale business, which now provides for over 165 stores in 10 countries, with her retail outlet is still a top priority and she makes a point of using the lessons learnt through retail to add value to her wholesale business at the same time.
One of these lessons, she says, is the importance of new stock on a continual basis and a focus on seasonality, which draws more customers in.
“What you understand as retailer as well is how critical it is to keep that freshness to keep the customers coming back, and I think that's what the big retailers, such as Top Shop, do so well,” she says.
“So we've learnt how important it is to add depth to our collections and we drop as often as we can into our store. However, we will never turn our back on the wholesaling business, and we actually order in for our store just as if it was a wholesale customer.”
General manager of Shakuhachi, Samantha Eaton, says the Australian designer label works much in the same way and it was actually the strong wholesale sell-through with stockists that made October 2010 the right time for the brand to move into retail.
“We still focus heavily on wholesale and wholesale growth in the business, opening a retail store was simply a natural progression with the growth of the label,” she says.
“It's important to be confident that you have a big enough client base to warrant having your own store. Retail is tough in general, but when investing money into fit-outs, retail systems and extra staff you want to feel confident that you will not run at a loss.”
Bassike general manager Billy Voss agrees, and says that investing in a retail outlet for a brand doesn't necessarily have to mean leaving your wholesale business behind or making it less of a priority. For Voss, its more about finding a cohesive balance.
“For Bassike there was never a question of moving into bricks-and-mortar 'instead' of wholesale expansion. Both divisions are very important to the brand and we have teams in the business that are focused on each of these areas. The sustainability of the brand's wholesale depends on a retail strategy that respects the wholesale channel.
“If managed correctly both channels support each other by promoting brand awareness in different ways, retail by giving a full brand experience and wholesale by the best brand association. Both channels working like a brand eco-system,” he says.
However, for Bassike, which launched its first retail store in Avalon mid-2009 and opened its second store in Paddington, Sydney in September last year, mastering this balance of wholesale and retail together has been a challenge.
Voss says the decision to take Bassike into retail was based on a desire to showcase the label in its entirety and provide customers with the full brand experience. The retail venture has been extremely successful and Bassike now juggles over 80 stockists internationally as well as four online outlets in addition to its two retail stores. But Voss says inventory management and a lack of flexibility in terms of stock has been difficult.
“The challenge is definitely running a retail business and a wholesale business in parallel as it creates challenges from an inventory management point of view,” he says.
“Running your own retail stores, you're purchasing product from yourself, so you lack the flexibility that a multi-branded retailer would have, in terms of being able to manage stock and your stock levels. You don't have that same flexibility of being able to go out there and purchase product for what's happening in the marketplace. You're engineering product yourselves, so you're very much committed to your initial plan.”
Voss says it's also vital to remain concious of the way stock is managed when running a retail store in conjunction with a wholesale business to ensure that is doesn't impact negatively on the wholesale business.
“It's a priority and it's very delicate,” he adds. “So for example, when it comes to things like an 'end-of-season clearance', you've go to make sure that what you do with your own stores is complementary to your wholesale business and doesn't affect those stores.”
Designer Kate Sylvester, who has been operating her first Australian flagship store in Paddington, Sydney for just over a year, says she has also experienced her fair share of challenges broaching retail in Australia.
Despite having started her business via retail in New Zealand, the brand entered the Australian market as a wholesaler and Sylvester says launching a retail store in this new market, has been a learning curve.
“Australia is a new market for us and although we've wholesaled into Australia for a long time, it's quite different to having a retail store,” she says.
“Just getting the product mix right and the whole pattern right in terms of when to drop product into stores and when everyone goes on sale, just the whole process on getting in sync with the Australian market on all of that has been challenging and quite different to how you release with wholesale, which in my view is a lot more straight forward.”
Building up the store's customer base, turning existing wholesale customers into a retail customers and extending brand awareness has also been a focus for Sylvester.
Since expanding into retail in Australia in December 2009, Sylvester has worked on boosting awareness of her brand in the country via EDM, store events, direct marketing and building up her brand database through the Sydney store.
The hard work has been worth it, Sylvester says, and panned out so well, in fact, that the designer is looking at opening another store in Melbourne in the near future.
“Business is going great now. February was really tough, but March has really kicked in and it's been good, so we're very keen to look at launching a store in Melbourne maybe next year. Of course, the exact timing totally depends on finding the perfect store and in the right location,” she says.
McCall is in the same boat – her retail experience has been nothing smooth sailing and she is now gearing up to open her second retail store in Sydney this September, just one year from the first dip into retail.
But she agrees with Sylvester in terms of location, and says choosing the right spot for a bricks-and-mortar store is essential.
“I personally believe that it's better to open a store in the same area where there are shops in the same range as your own,” she says. Some people open destination stores, but that can cut off a lot of potential customers. I believe is better and a positive thing when you are placed right next to your competitors and peers. That's why shops like Westfield are so good.”
And Westfield is exactly where McCall is tipped to open up next.
“For the second store this year, I'm definitely interested in Westfield as a conglomerate in Sydney and then Melbourne, Chapel Street will be our third location. That's our retail strategy,” she says. “It's definitely the right time for our brand and it's definitely a positive thing. Even though retail is a bit down at the moment, we're not really feeling it that much because we have a big fan base. And I think I'm going to push the layout a bit more than with my first.” Stay tuned.
Most people managing an interview on the run from the backseat of a cab in Bali might seem a little frazzled, but if she is, designer Alice McCall doesn’t show it. Calm, collected and succinct in her responses, she’s in control. And, interestingly, when asked about why she recently opened up her first retail store, that’s exactly what she answers.
“I wanted to have full control of the way my brand was represented to the public, and it was also critical for brand growth and brand identity,” she says.
“My label is seven years old now, so we had enough experience to understand what our brand is all about, so it was the right time to go vertical. I think there are a few key things you benefit from when moving into retail and the first is having complete control of your brand and the way it is merchandised, hence perceived, by the public.”
McCall describes her first store, which opened doors in September 2010 in Sydney’s Surry Hills, as low-risk – a strategy which she says contributed to the success of her first retail venture.
“Initially I wanted to test the market, so I ensured that my first retail store was low-risk by making sure that my overheads on the store, such as rent, weren’t too high. I also didn’t spend too much on the first fit-out as far as business goes. I spent enough, but our collection was so strong that I wanted it to be in an environment that was clean and reflective of the Alice McCall brand, and would allow the clothes do the talking.”
The result has been high reward and McCall says that despite a soft retail market, the move into retail has paid off for the brand with minimal challenges.
“We’ve been exceeding budgets with our store, particularly in the first four months of operation, from September to January,” she says. “It did die off a little bit last month, which has been normal for retail in general, but as a whole, it’s been successful for us.”
However, the benefit of broaching into retail for McCall has extended beyond financial gain. She says one of the most valuable benefits gained from giving her business a physical shop front has been access to direct feedback from customers.
“Another key thing I’m learning since having gone into retail, is that you benefit from direct market research as to what products work and what products don’t. Going into retail gives you this information back about your product that really helps you with design. For example, what silhouettes work and what the customer feels that you don’t have.
“You don’t really get that with pure wholesaling when there are all the middle men. You wouldn’t really have a wholesaler ever say to you, ‘I really feel like Alice McCall needs more bottom-weights, etc’, because they have other labels that will do that for them.”
However, balancing her wholesale business, which now provides for over 165 stores in 10 countries, with her retail outlet is still a top priority and she makes a point of using the lessons learnt through retail to add value to her wholesale business at the same time.
One of these lessons, she says, is the importance of new stock on a continual basis and a focus on seasonality, which draws more customers in.
“What you understand as retailer as well is how critical it is to keep that freshness to keep the customers coming back, and I think that’s what the big retailers, such as Top Shop, do so well,” she says.
“So we’ve learnt how important it is to add depth to our collections and we drop as often as we can into our store. However, we will never turn our back on the wholesaling business, and we actually order in for our store just as if it was a wholesale customer.”
General manager of Shakuhachi, Samantha Eaton, says the Australian designer label works much in the same way and it was actually the strong wholesale sell-through with stockists that made October 2010 the right time for the brand to move into retail.
“We still focus heavily on wholesale and wholesale growth in the business,” she says. “Opening a retail store was simply a natural progression with the growth of the label.
“It’s important to be confident that you have a big enough client base to warrant having your own store. Retail is tough in general, but when investing money into fit-outs, retail systems and extra staff, you want to feel confident that you will not run at a loss.”
Bassike general manager Billy Voss agrees, and says investing in a retail outlet for a brand doesn’t necessarily have to mean leaving your wholesale business behind or making it less of a priority. For Voss, its more about finding a cohesive balance.
“For Bassike there was never a question of moving into bricks and mortar ‘instead’ of wholesale expansion,” he says. “Both divisions are very important to the brand and we have teams in the business that are focused on each of these areas. The sustainability of the brand’s wholesale depends on a retail strategy that respects the wholesale channel.
“If managed correctly both channels support each other by promoting brand awareness in different ways, retail by giving a full brand experience and wholesale by the best brand association – both channels working like a brand ecosystem.”
However, for Bassike, which launched its first retail store in Avalon in mid-2009 and opened its second store in Paddington, Sydney in September last year, mastering this balance of wholesale and retail together has been a challenge.
Voss says the decision to take Bassike into retail was based on a desire to showcase the label in its entirety and provide customers with the full brand experience. The retail venture has been extremely successful and Bassike now juggles over 80 stockists internationally as well as four online outlets in addition to its two retail stores. But Voss says inventory management and a lack of flexibility in terms of stock has been difficult.
“The challenge is definitely running a retail business and a wholesale business in parallel as it creates challenges from an inventory management point of view,” he says.
“Running your own retail stores, you’re purchasing product from yourself, so you lack the flexibility that a multi-branded retailer would have, in terms of being able to manage stock and your stock levels. You don’t have that same flexibility of being able to go out there and purchase product for what’s happening in the marketplace. You’re engineering product yourselves, so you’re very much committed to your initial plan.”
Voss says it’s also vital to remain conscious of the way stock is managed when running a retail store in conjunction with a wholesale business to ensure that is doesn’t negatively affect the wholesale business.
“It’s a priority and it’s very delicate,” he says. “So for example, when it comes to things like an ‘end-of-season clearance’, you’ve got to make sure that what you do with your own stores is complementary to your wholesale business and doesn’t affect those stores.”
Designer Kate Sylvester, who has been operating her first Australian flagship store in Paddington, Sydney, for just over a year, says she has also experienced her fair share of challenges broaching retail in Australia.
Despite having started her business via retail in New Zealand, the brand entered the Australian market as a wholesaler. Sylvester says launching a retail store in this new market has been a learning curve.
“Australia is a new market for us and although we’ve wholesaled into Australia for a long time, it’s quite different to having a retail store,” she says.
“Just getting the product mix right and the whole pattern right in terms of when to drop product into stores and when everyone goes on sale, just the whole process on getting in sync with the Australian market on all of that has been challenging and quite different to how you release with wholesale, which in my view is a lot more straight forward.”
Building up the store’s customer base, turning existing wholesale customers into a retail customers and extending brand awareness has also been a focus for Sylvester.
Since expanding into retail in December 2009, Sylvester has worked on boosting awareness of her brand in the country via electronic direct mail, store events, direct marketing and building up her brand database through the Sydney store.
The hard work has been worth it, Sylvester says, and has in fact panned out so well that the designer is looking at opening another store in Melbourne in the near future.
“Business is going great now,” she says. “February was really tough, but March has really kicked in and it’s been good, so we’re very keen to look at launching a store in Melbourne maybe next year. Of course, the exact timing totally depends on finding the perfect store and in the right location.”
McCall is in the same boat – her retail experience has been nothing but smooth sailing and she is now gearing up to open her second retail store in Sydney this September, just one year from the first dip into retail.
But she agrees with Sylvester in terms of location, and says choosing the right spot for a bricks-and-mortar store is essential.
“I personally believe that it’s better to open a store in the same area where there are shops in the same range as your own,” she says. “Some people open destination stores, but that can cut off a lot of potential customers. I believe it’s better and a positive thing when you are placed right next to your competitors and peers. That’s why shops like Westfield are so good.”
And Westfield is exactly where McCall is tipped to open up next.
“For the second store this year, I’m definitely interested in Westfield as a conglomerate in Sydney and then Melbourne, Chapel Street will be our third location. That’s our retail strategy.
“It’s definitely the right time for our brand and it’s definitely a positive thing. Even though retail is a bit down at the moment, we’re not really feeling it that much because we have a big fan base. And I think I’m going to push the layout a bit more than with my first.”