The owners of a Schenectady-based textiles company say they are weathering the recession with innovative designs and a hard-to-imitate business model that keeps costs in check.
The national retail sales bust of last autumn had stores requesting buyer discounts from local supplier Marika and Charles Contompasis, a sister-brother design team that manufactures high-end knitwear, garments and accessories under the label Marika Charles through their company Keryakos Inc.
“They cut back and ordered less” overall, said Marika Contompasis, adding that the orders from stores were bigger, but much fewer, as stores pared down excess inventories.
Year-to-date retail trade sales were down 10 percent in May, according to the U.S. Census Bureau.
Though Keryakos has never experienced a canceled order, a downturn in summer orders for the Marika Charles collection sparked layoffs at the end of February. Now, 15 people hand-dye and make garments at the 1080 Catalyn St. production facility.
But signs of a more optimistic retail environment are evident — the designers say stores are now following up with reorders to make up for their cautious buying during the spring and winter.
Vendor participation at fashion shows has also trailed off because of the economy, Charles Contompasis said. But Marika Charles continues to show off its latest fashions five times a year both in Los Angeles and New York City in conjunction with their year-round showroom in New York City’s Bryant Park.
With global distribution hovering around 200 stores, Marika Charles can be found in high-end locales like Ron Herman, Fred Segal, Barney’s in New York City, and Calypso.
Aligning production based on sales history instead of the traditional three-year forecast for clothes makers also proved to be invaluable for Marika Charles.
“Our business model of just making what we need protected us during the recession,” Charles Contompasis said.
“I can have an idea on the way to work and can have it in production in hours,” Charles Contompasis said.
Their patented process called Phly-Dye exhausts colors directly onto premade white fiber fabric, allowing designs to quickly move from digital files in Adobe Illustrator, Photoshop and other computer programs, to production.
The Marika Charles collection began in 2001, after Charles Contompasis took what he knew as the founder of Twin Rivers Textile Printing Company during the 1990s and innovated, he said.
Keryakos is a part of a larger trend within the textiles industry of using innovation in design and retail distribution to limit manufacturing expenses, which has historically forced companies to outsource labor overseas to cut cost.
Currently the company has four patents under the Phly-Dye process.
Charles’ wife, Laurie Ives, manages administrative and business tasks for Keryakos. Their son, Stace Contompasis, a Niskayuna High School graduate who will study digital media at Marist College this fall, helps out with the family business as well.
Recently, the company’s printing and dyeing techniques won Marika Charles designers’ acclaim.
Keryakos was honored in the May edition of Apparel Magazine as one of 40 top apparel companies innovating through tough times through leadership, resourcefulness and creativity.
On the first floor of the company’s building is the Marika Charles factory outlet store, which sells slightly imperfect merchandise and extras created by production overruns and creative experiments.
There, the owners go from supplying to retailers, trying their hand at creating a retail experience for local shoppers through music, lighting, smells, and sometimes through offering baked goods to customers. Beginning this Friday at 10 a.m., Marika Charles will host a three-day sale, that will feature 25 percent off already discounted garments. For instance, some Marika Charles T-shirts that would normally retail for as much as $100 elsewhere will be sold for $15 or less at its Schenectady outlet store.
The company is banking on consumers who are cutting back and will leap at the mere mention of getting a bargain on a $300 cashmere sweater.
Having a retail space since November has helped offset sales lost in other aspects, as the company competes with the artistic content and quality of couture designers around the world.
“We’re as good as them for a fraction of the cost,” said Ives.
Sales are held only on weekends and only sporadically throughout the year to create buzz and keep loyal customers coming back because “they know there’s not going to be another sale for another two to three months,” Marika Contompasis said.
Keryakos said its sales for the 2008 fiscal year were $2.4 million.