Frederick

By SHELLY GARCIA Staff Reporter Two years ago, M. Frederic had the opportunity to expand one of its retail stores into larger quarters. The store had outgrown its old space, but the new space was larger than the retailer required, so the company’s owners decided to add a boutique selling a category of merchandise it had never carried before loungewear. Thus was born M. Frederic Inactive, the latest in a group of boutiques launched by the Agoura Hills-based retailer. The story of its creation is a good example of the way M. Frederic has grown from a single outlet carrying modestly priced women’s apparel to a fashion-forward group of boutiques that also include women’s active wear, children’s clothing, and now loungewear. Instead of focusing on building more locations for an existing merchandise mix, Fred Levine, the company’s chief executive officer, has expanded by adding new categories of merchandise. “We might not ever have more locations,” Levine said. “We’re focusing on our existing customers. We can be more profitable by having the same number of locations and having a better reputation among the customers we have.” The retailer is in the process of setting up a cluster of boutiques at each of its six locations in the San Fernando Valley and the Westside of Los Angeles M. Frederic Women, M. Frederic Kids, M. Frederic Active and M. Frederic Inactive. In newer locations, the boutiques are adjacent to each other. Customers can enter each one through a separate entrance, or they can wander from one to the other through a series of connecting passages. In older locations, the company expands as space becomes available, and the different boutiques may be spread out throughout the shopping center. “The divisions started as a personal thing,” Levine said. Activewear was added after Levine and his wife, Lisa, who handles much of the buying, began working out regularly. Children’s wear followed when sister Mardi Fox had her first child. She still handles the buying for that division. “The customer moves along with us,” Levine said. “As our stores get more mature, and our customer gets more mature, our merchandise will change.” When M. Frederic opened its doors 19 years ago, its customers were mainly twentysomethings without much money to spend. As they aged and became more prosperous the retailer followed along, changing its assortment and its price points to match the customers’ changing lifestyles. “When our customers were 24, we carried moderately priced apparel,” Levine said. When they turned 35, we started carrying more expensive, fashion-forward stuff.” The strategy has helped to double sales in the past three years, Levine said, to $10 million. Though he won’t reveal earnings, he says all four divisions are profitable. Most of the earliest stores, on the Westside, were in shopping malls. But as malls began to fall out of favor, Levine began moving out into street and open-air shopping center locations. The idea was to create neighborhood shops, where customers could find merchandise they wouldn’t find anywhere else. “We couldn’t keep our neighborhood customers (in the malls),” Levine said, because of the problems of parking and distance. “It was too much of a hurdle.” Today, the shops keep their neighborhood appeal, often calling customers when new shipments come in or when special promotions are going on. “When they get new shipments, they make their calls, and people are standing in line waiting to get in,” said Dick Cantrell, the owner of Hard Tail, a sportswear line that is among those M. Frederic carries. Beginning about 10 years ago, the company moved from moderately priced, sporty knit T-shirts, pants and skirts to contemporary styles that followed the changes in fashion. Chains like Banana Republic and The Gap were selling basic sportswear, and as a small independent, M. Frederic needed to find a point of difference. About three years after the upgrade, M. Frederic added the activewear division and, soon after, children’s clothing. The company now has all four shops in five of its six current locations Brentwood, Marina del Rey, Studio City, Encino, Westlake Village and Calabasas. The newest addition, Inactive, is currently in two locations with plans to expand into the others as space becomes available. The retailer refines its assortments in each division frequently, drawing on what’s hot in the fashion world at any given moment, always with an eye to keeping the selection of merchandise distinctive. “We don’t typically buy from nationally recognized labels,” said Levine. “We carry lines that are made only for our store. Then we carry lines that are so small you can only find them occasionally in other stores.” “They’re big on exclusivity,” said Debbie Garcia, a sales associate at Lucky Brand Dungarees, one of the lines the store carries. “They try to carry lines everyone is not carrying, so they’re great lines and they’re not all over the place.” Levine said that because the business is family run, he and the two other buyers can react quickly to changes in the marketplace. The company’s active wear assortment, for example, has moved from running apparel to gym clothes, many of which can also be worn as sportswear, as is the current trend. “If yoga becomes more popular, we’ll carry more yoga wear,” Levine said. If a new style tests well, the company will buy it in a wide variety of colors and different silhouettes, such as long- and short-sleeved shirts or long pants and shorts. The strategy also helps to differentiate the retailer from department stores, which tend to carry only a few pieces from high-fashion suppliers. “If a style sells, and people like it, they’ll buy it in 28 colors,” said Cantrell. “A lot of people will say, ‘I don’t really have the money or the room.’ He’s very sharp in his understanding of merchandising.” At a time when independent retailers are being replaced by national chains in record numbers, M. Frederic’s philosophy has helped the company buck the trend. But even Levine concedes that it is unlikely that the formula would work for someone setting up a store now. The customers who have shopped M. Frederic for years feel secure that the fashion the store offers is timely and in good taste. “If we started right now, we’d be in big trouble,” Levine said. “Our customers really trust our judgment as buyers. They’ve grown up with us.”