Specializes in Private label and stock production of Outerwear, Sportswear and Activewear.
The company operates in the Apparel Wholesaling industry, where revenue growth has been sluggish over the past five years. During the earlier half of the period retailers offered steep discounts to consumers in order to retain sales. Due to weak downstream demand wholesalers were left with excess inventories and slashed their prices to move stock.
Many manufacturers have vertically integrated and now act as wholesalers, resulting in increased profit for them and for retailers by cutting out intermediaries in the supply chain.
The company is headquartered in the Los Angeles area in a commercial building within a commercial park environment. The company occupies 5,000 square feet, which includes office space. This is a new location for the company, and will result in a lower yearly rent payment. The Company uses a commercial warehouse, also in the Los Angeles area, for 3rd party fulfillment - almost all inventory is shipped in containers from China to the Los Angeles docks and delivered from there to the warehouse. The Company pays the storage company usage fees based on storage and # of transactions.
The CEO / owner’s forecast for revenue from new product lines (hard goods) through 2023, and trends identified from operating statements for the period 2013 - 2015, for COGS and operating expenses. The following assumptions were made for the forecast and growth potential. Revenue: Over the period of 2012-2016 the apparel industry grew at an annualized rate of 0.5%. However, this included expected growth of 1.7% in 2016, meaning that for the period 2012-2015 industry revenue declined at an annualized rate of 0.36%. By comparison, for the period 2013-2016 the Company’s revenues increased. It is assumed that over the period 2018-2023 an industry partner/acquirer would grow revenue at a substantially greater rate.
Many manufacturers have vertically integrated and now act as wholesalers, resulting in increased profit for them and for retailers by cutting out intermediaries in the supply chain. While apparel is among the first things consumers cut back on in times of economic hardship, over the five years to 2016 demand from clothing stores was anticipated to increase at an annualized rate of 1.8%.
Despite significant recovery, the current owner is aware that in this market environment, there is a need for consolidation. The owner believes that by staying on board for several years or as needed he can accomplish three main goals: To take the company he loves to the next level, to help secure and improve his employees’ livelihood and to sell the company he developed while making sure he can reach his financial and personal goals.
Will train for 4 weeks @ no cost The Company specializes in both private label and stock production of outerwear, sportswear and activewear. The Company’s products are sold in many active and outdoors retailers and catalogue marketers, as well as many other labels.