Selling suits to NYC’s successful bankers and brokers was a whole different business two and a half years ago than it is today. Just ask NY Report’s March 2007 cover man, Ken Giddon, co-owner of luxury menswear clothing stores, Rothman’s, in Union Square and Scarsdale. NY Report’s managing editor caught up with Ken to find out how their business strategy has changed and why that new strategy is working.
Daria Meoli: This has been a tough year for retail. What have you done to deal with the economic situation?
Ken Giddon: In our business, the biggest change we can make is to control our inventory. Our task has been to anticipate the changing consumer sentiment, and I think so far we’ve done a pretty good job. We’ve changed our product mix to some degree. If 30% of our business was in designers like Canali and Zegna—higher-end lines—we’ve moved that down to 20%, because we truly think that people are less willing to spend for luxury. The other thing we’ve done is to try to take advantage of the disruption in the entire industry. We’re able to leverage relationships with vendors to make very opportunistic and advantageous buys. We can then pass that on to our customers, so that there’s always stuff on sale even in the middle of the season. If somebody walks in, they might find something at 30% less than they saw it last year. You could argue that we might spoil the customer and they’ll always expect these prices, but I don’t really believe that. I think this is a unique time that requires a unique approach.
DM: So, you are not against discounting?
KG: Not at this point. I think people walking into any business right now expect a deal, even when they go to the car wash.
DM: The last time you spoke with NY Report, a lot of your clientele was employed in the finance and banking industries. How have your customers changed over the last year?
KG: New York is incredibly diverse and has an incredibly diverse economy. We definitely noticed that our business has suffered from the loss of the Wall Street guys. People will say, “Well, people will be buying interview suits,” but that’s not really true. You don’t go out and spend money on an interview suit, hoping you’re going to get a job. You use the one that you have and try to make it look a little better. But there are plenty of other people out there who are making money right now. Also, the event business weddings, bar mitzvahs, big birthday parties, anniversaries—does not slow down at all, ever. That is a big part of our business now.
DM: As a leader in your company, what have you been doing personally to keep your employees—and yourself—going?
KG: I’m very optimistic right now, and I think this is opportunity time. I’ve been communicating a lot more with my employees and saying, “Times are tough, but we’re here, we’re strong, and we’re going to come out of this.” We’re not going to make a ton of money this year; and we look to survive, then use this as an opportunity to make advantageous buys and re-evaluate our real estate situation, and perhaps move or open another store. There are a lot of interesting things going on and I think every generation gets one opportunity to buy assets at distressed prices. And I think for our generation right now, this is the time. You have to look at these times as opportunities, and you have to be optimistic and go for it, and that’s sort of the approach that we’re taking.
Daria Meoli is the Executive Editor at The New York Enterprise Report. She can be reached at firstname.lastname@example.org