Who said the frozen yogurt craze is melting away?
Self-serve frozen yogurt chain Menchie’s Group Inc. has been in a growth swirl since opening its first location on Laurel Canyon Boulevard in Valley Village in 2007.
Menchie’s, which is scheduled to open its 100th U.S. store at the end of next month, is planning to open an additional 130 or so stores nationally and abroad during the next six to eight months. The majority will be franchises.
The privately held company has also doubled the number of employees at its Encino headquarters to 60 to keep up with the growth.
“The community just embraces us and we have really established ourselves,” said Amit Kleinberger, chief executive at Menchie’s, which is known for its family-friendly atmosphere, with stores featuring oversized chalkboards for kids to draw on.
Menchie’s has benefited from the weak economy that chilled consumers’ cravings for premium-priced frozen yogurt. Under its self-serve model, customers pay 44 cents an ounce for yogurt and toppings, significantly less than Pinkberry and Red Mango, which charge by cup size and number of toppings.
Menchie’s, founded by husband and wife team Adam and Danna Caldwell, began opening locations in Canada and Japan last year, and now plans to launch in countries such as Australia, United Arab Emirates and Mexico.
Capital Injection
Gardena apparel maker Big Strike Inc. has just hit it big.
Westwood private equity firm Gores Group, led by L.A. billionaire Alec Gores, has invested in the company. Terms of the deal, announced last week, were not disclosed.
Big Strike designs, manufacturers and wholesales moderately priced apparel for juniors. It has spent the past several years searching for capital to help the company expand into the “missy” category (for women between the ages of 30 and 50), and grow its juniors tops and bottoms merchandise.
Lars Viklund, president and founding partner at Big Strike, said the company opted to partner with Gores Group because the private equity firm has a strong management team that can help shore up Big Strike’s operations.
“The main thing we wanted was to stay on, grow the company and take it to the next level,” Viklund said. “And they are giving us those capabilities. And they have great people in their operations that can help us with the back end of the business and let us do what we love to do best, merchandising and sales.”
Big Strike, with annual revenue of more than $100 million, sells apparel at department stores such as Kohl’s, JC Penney and Dillard’s. Its brands include Heart N Soul, Soulmates, Free to Love and Halo.
Jeff Schwartz, managing director at Gores, said the time was right for the firm to step in at Big Strike.
“They had grown their business to a point and they were looking for a financial partner to help them take it the next level,” Schwartz said. “We were impressed with the team there, the business model and products they brought to the market.”
Gores’ investment comes as Big Strike recently acquired Tracy Evans brands and brought in Paula Schneider to serve as chief executive. A veteran apparel executive, Schneider has worked at Speedo, Laundry by Shelli Segal and BCBG Max Azria.
Meanwhile, Gores has been boosting investments in consumer retail companies after closing a $2.1 billion fund last year. The firm made its first deal in the fashion world last year, investing in New York luxury apparel brand J. Mendel.
“There are a number of consumer retail companies that are undercapitalized and in need of equity investments,” Schwartz said. “It’s a fruitful area for us to explore.”
Premium Addition
Kevin Mahoney is jumping back into the women’s apparel world.
Vernon denim maker Not Your Daughter’s Jeans announced two weeks ago that Mahoney has joined the company as president. A 27-year veteran of the apparel business, Mahoney most recently served as president and chief executive at Hartstrings, a Philadelphia children’s apparel wholesaler and retailer.
Not Your Daughter’s Jeans, known for its tummy-tuck jeans sold at Nordstrom and other department stores, brought in Mahoney to help the company expand. The company has been adding skirts, chinos and trousers to its product lineup.
“I have a strong background in design, marketing and brand building,” Mahoney said. “There’s a lot of room for expansion organically, through production expansion and extension, and international growth.”
Not Your Daughter’s Jeans was founded in 2003 by Lisa Rudes-Sandel and her father, George Rudes. New York private equity firm Falconhead Capital acquired a major interest in the company in 2008.
Staff reporter Alexa Hyland can be reached at [email protected] or at (323) 549-5225, ext. 235.
