When Jed Kagan walks into a women's clothing store, he likes what he sees.

Racks are filled with rhinestone-speckled shirts, sweatshirts bedazzled with sequins, handbags with ornate beading and studded jeans.

"Everything from jeans to old vintage cowboy shirts have been redone to be embellished," Laura Wagner, owner of the boutique Tryst, said of the clothes that have been popular in her Studio City store for the last two seasons.

For Kagan, president of Vernon-based G. Kagan & Sons Inc., embellishments are fueling growth at his company, one of several local trim specialists that sell apparel manufacturers everything from feathers to tassels to ribbons.

Kagan said business is up 25 percent to 30 percent over last year, and annual revenues have topped $8 million. Los Angeles-based Jacob Supplies Inc., another privately held trim company that does over $10 million in annual revenues, has seen sales increase 10 percent to 20 percent this year.

"The strong demand for embellishments in garments has certainly increased our sales," said Kagan, pointing to sequins and rhinestones as especially hot items. "They are as strong as they have been over the last few years."

For trim companies, it's a ray of hope in an industry ravaged by competition from overseas. While low-cost trims are being made en masse mostly in China these local companies can quickly produce customized items.

Elaborately sequined butterflies for expensive, dry clean-only garments, for example, are difficult for Asian companies to duplicate cheaply.

"We want our customers to come to us and tell us what is new," said Kagan. "It also does point out the importance being able to get what you need and walk out the door the same day."

Michael Schreier, chief executive of Los Angeles-based Eastwest Clothing Inc., pointed to faster turnarounds and ease of communication as reasons for doing business with local trim companies. Eastwest makes heavily embellished women's clothes under the label Language Los Angeles, selling from $60 to $110 at Nordstrom, Bloomingdale's and Macy's.

Schreier said it's not uncommon for Eastwest to ask a local company to produce a trim to its specific style requirements. Such interaction between the designer and trim company is what makes the local operations valuable, even as more production moves abroad.

"Obviously, we would love to work with more local people," he said, although he noted that price sensitivity forces him to purchase trim from abroad.

Overseas competition
As with apparel manufacturers, the trim business has seen prices fall as a result of Asian competition.

Kagan's satin rosebuds are an example. Before Asia became such a force in the market in the 1990s, the company was able to make them at 5 cents each and sell them for a dime. Now, they're made at a penny each and sold for 2 cents.

Such price sensitivity has forced trim companies to do more of their production offshore. Kagan has a 50 percent stake in six Asian companies, where the company does much of its manufacturing. The company still produces certain items in its 50,000-square-foot facility in Vernon, such as cord for sweatshirt hoods. It also handles finishing for many of the fashion trim pieces.

Jacob has a similar mix of local and foreign production, with much of the manufacturing completed in Asia. The company recently opened an office in Hong Kong to oversee quality control in Asian factories. (Kagan has a Hong Kong office as well.)

Kagan has learned to operate more efficiently, cutting its workforce to 30 from a high of nearly 70. But many companies haven't survived. Both Kagan and Jack Yang, president of Jacob Supplies, said it's less crucial for trim companies to be in the U.S. because they largely deal with the foreign sewing contractors.

When trim companies are on the crest of a fashion trend, however, they can charge a premium for high-demand items, making up for smaller sales volumes. A glass rhinestone can cost up to 10 times its acrylic counterpart.

To get the windfall that comes from being fashionably on-target, trim companies work hard to identify upcoming looks. Kagan has an art department that forecasts trim style trends, and Yang said he's constantly going to trade shows and looking at magazines to see what's popular.

As with clothing companies, being spot-on can generate buzz that helps attract customers. But popularity has a downside: trim companies worry about their designs getting copied by other companies that undercut their prices.

"I come up with some style, and somebody knocks it off. Any flower, they can knock off," said Patrick Yang, manager of Monterey Park-based Designer's Touch Inc. Designer's Touch has begun to trademark its trim designs to protect against the copying.

The competition wasn't always so fierce. When Jack Yang (not related to Patrick) left apparel manufacturing to start Jacob Supplies in 1988, he recognized a lucrative niche. Now, he said, companies have hurriedly filled the vacuum, both here and abroad. To beat the competition, Yang must expand its fashion-oriented trim accessories selection, which numbers in the thousands of items.

Unlike many trim companies, 90 percent of Yang's business is devoted to these fashion items, while 10 percent goes towards zippers and other trims that are staples of garment construction. At Kagan, half the business is fashion items, and the other half is garment-construction items such as straps and buckles.

Kagan believes that keeping this side of the business steady helps maintain a balance against the risky fashion item business, where Kagan is dependent on consumer tastes for embellishment. In the fashion business, when an item catches on, the market floods with new entrants seeking to profit from the latest fad.

Kagan estimates there are still a couple of months left to the sequins and rhinestones craze. Kimmy Song, chief executive of It Jeans Inc., based in Los Angeles, said she will still be using embellishments on It jeans, although they are going to be toned down a bit in the near future.

"For fall, you are still going to see the rhinestones and crystals," she said. "But coming spring, they are more natural."

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