Few apparel companies have attained more recognition in so few years than Faherty, a contemporary sportswear brand founded in 2013 by twin brothers Alex and Mike Faherty, with a focus on sustainability and cool casual sportswear. Here, we catch up with Alex to discuss how the pandemic is impacting current business and future plans.
Q: How are you Alex and how’s business?
A: I’m doing fine: the quarantine has allowed me to spend more time with my kids (ages 2 and 4) so I feel truly grateful.
As for business, it’s holding up much better than we expected a few months ago. Our collection is based on quarantine-friendly comfortable clothing that’s perfect for this increasingly casual era. (I only wish we had more sweatpants!) We saw a bigger increase in women’s than in men’s so the overall business is now 50-50 (women’s had been 30 percent). Women’s overalls were a hot item this summer.
Q: With the risk of more shut-downs, are you increasing your direct-to-consumer vs. wholesale business?
A: About half our business now is online and we’re seeing increases in this segment. We have 12 of our own stores (half in California and half in the Northeast) that generate 20 percent of our total volume. These stores had been shut down: California started opening end-May and northeast stores in June and business has been better than we expected. Our wholesale business (30 percent to total) picked up in May and Father’s Day was very strong.
Q: So, you’ll maintain your ratio of e-commerce to company stores to wholesale?
A: Yes, we’re comfortable with this 50/20/30 ratio. We’ve spent a lot of time and effort cultivating our wholesale business; our retail partners are terrific and very important to us. Many upscale specialty stores that once emphasized tailored clothing are now switching their focus to sportswear. We offer premium fabrics at accessible price points, which is what these merchants are looking for.
Q: So that’s your success secret: premium fabrics at accessible pricepoints?
A: That’s part of it: Mike (who had great training at Ralph Lauren) deserves tremendous credit for creating new fabrics from scratch, often combining performance and sustainability with comfort.
But while consumers are becoming more conscious of things like organic and recycled fibers, sustainability is not the primary reason shoppers are loyal to a brand. I think a big factor now is that with the quarantine, consumers have more time: they’re paying more attention to product, to corporate values, to which causes their brands support. We’re a family business, which resonates these days. We focus on sustainability and we donate to several diverse causes. Over the seven years we’ve been in business, we’ve only deepened our mission to help save the planet, and customers are noticing!
In addition, we’ve become much better editors: each season our collection is tighter and more focused so we can stand behind every item we sell. This pandemic has forced us to concentrate on the things that really matter, to redefine our role as a brand, and to know when and how far to push the envelope.
Q: Are your retail partners paying bills? Demanding dating?
A: We’ve offered to extend dating in some cases and, in most instances, we’ve been able to work through any payment problems. We have long-term relationships with our retail partners; it’s all about trust.
Q: How are you positioned for fall deliveries? Will orders be shipped complete? I assume you’ve shifted some sourcing…
A: We’ve had to be agile. Because of COVID-19, we’ve moved more manufacturing to Asia (China, Vietnam) from South America and India. Of course, higher duties out of China are a factor, but our current strategy involves a focus on core product while cutting back on the fringe. Another recent decision was to extend the selling season, which makes so much sense. We’ve pushed everything back so that summer-focused capsules arrive into September. We’re able to sell items like linen shorts, swimwear, and our amazing (recycled poly with a natural hand) all-day shorts at full-price throughout the season.
Q: How are you managing your wholesale business without trade shows?
A: We’re using the NuOrder platform: virtual showrooms and zoom appointments. We’re also seeing a few retailers in August in our New York showroom, by appointment, and socially distanced of course!
Q: It sounds like you’re doing a lot right. What do you worry about?
A: I guess it’s the uncertainty. Considering the rising case counts in California, Texas, Florida, and other states, it’s possible business might shut down again. Even without shutdowns, traffic in our California stores has fallen off the cliff…
But we’re confident it will come back. We believe in our mission, our product, and our pricing. Despite tariffs out of China, our pricing is essentially stable, with some items slightly up, and some slightly down. Our theory is to go with the price that gives retailers 100 percent sell-through’s, rather than the price that makes us the most money. That’s what defines our relationships, and that’s what keeps our retail partners coming back.