Footwear company K-Swiss Inc.'s style mainstay it's Classic shoe is getting scuffed up.


Sales of the Classic dipped 14 percent for the quarter ended March 31 from the same period the prior year, even with some offsetting due to a price increase. Overall, domestic revenues from K-Swiss brand products fell to $103 million in the first quarter from $118 million from the like quarter the year before.


"The first quarter results continue to reflect the negative trends we have been experiencing in our domestic business," Steven Nichols, president and chairman of the board of Westlake Village-based K-Swiss, said in a statement. And Nichols didn't sound positive about the immediate future. He predicted a domestic turnaround wouldn't be in full swing until 2007, at the earliest.


Deena Friedman, an analyst with Brean Murray Carret & Co., believes fashions are passing K-Swiss by. "We continue to be concerned that K-Swiss' product is not trend-right in this dressier fashion environment, which is more supportive of non-athletic footwear," she wrote in a research note.


Friedman, who has a sell rating on K-Swiss, cut her earnings per share forecast 3 cents to $1.34, which is ahead of K-Swiss' reduced guidance of $1.55 to $1.74 for the year. After the company reported earnings last week, K-Swiss shares decreased 1.7 percent to land at $28.89 on April 27.


There were a few bright spots during the first quarter. International K-Swiss brand sales were up 30 percent to $44.5 million. Revenues for its Australian-bred subsidiary Royal Elastics increased nearly 40 percent to $2.9 million worldwide. That increase happened with Royal Elastics' new L.A.M.B. product the shoes associated with pop star Gwen Stefani's design outfit on the shelves.


Still, K-Swiss acknowledges that it is going to be concentrating on its ailing core domestic operation. "Reigniting the domestic business is our top priority," said Nichols.


Top Priority
French West Inc. came in at the top of the denim market literally.


Founder Daniel Bohbot started the company based on Hale Bob tops, which are designed to accent pricey jeans for a stylish night on the town. Together, the jeans and shirt can set a woman back about $500.


With that high-rolling customer ensnared, French West is branching out from tops to boost revenue. Already, French West saw its sales leap to $16 million last year, double the prior year's take. This year, the company expects sales to almost double again.


Hitting the retail floor this month will be Hale Bob dresses that cost $250 to $400. Also available soon in department stores such as Macy's and Nordstrom will be Hale Bob shoes. French West has entered into a licensing agreement with Huntington Beach-based Titan Industries Inc. to develop and distribute the shoes.


Although French West is adding to its apparel and accessories selection, Bohbot said it wouldn't venture too far from its foundation: eveningwear that a chic woman can sport during the day. "There is more product, but always on the same focus," he said. "The orientation is always sexy for starting at cocktail time."


Bohbot is careful to control his distribution to pace-setting stores geared to his target customer. "We don't give to everyone," he said. "We try to develop a relationship with the accounts who believe in our product and where we believe in them."


Bohbot isn't growing Hale Bob without guidance. His brother, Marc, founder of the clothing brand Bisou Bisou, has joined him at French West. Although working with family can have its challenges, Bohbot said his brother complements him well. He's described himself as the creative partner, while his brother does the books.
World Vision


Denyse Selesnick fortuitously stumbled into her role on the trade show circuit by producing events abroad. Now, the world has come to her.


The president of Woodland Hills-based International Trade Information Inc. is helping spice up domestic shows by adding a foreign flavor. This month, she's putting on the "International Cuisine Pavilion" at the National Restaurant Association's large trade show in Chicago for the second time.


At the Pavilion, food vendors from more than 30 countries, including Italy, Germany, Spain, Greece, Turkey, China and Japan, display their wares. They pay $3,175 each for 100 square feet, including a draped table and two chairs, among other things.


At the trade show, Selesnick said a company can get a healthy gauge of whether their goods are going to play in the U.S. market. "You can't sit in New Delhi to sell your product. This way, you don't have to wait until a U.S. distributor comes to you to see if your product is competitive," she said.


For restaurants coming to the trade show, the international vendors introduce them to a variety that can't be found in the U.S., that's key for appealing to customers demanding ethnic food.


Domestic trade shows haven't always been so amenable to international players. Selesnick said domestic vendors have been worried about the competition from abroad, though the restaurant industry because of its familiarity with imported cuisines was among the most welcoming.


Tolerance of foreign competition has increased since Selesnick started doing trade shows in the mid-1970s. Then, while working in publishing and journalism, she was asked to produce an apparel show in Mexico City, among the first international trade shows ever held there.


"The infrastructure wasn't there, but I fell absolutely in love with Mexico," Selesnick recalled. "We went on to do about 60 different kinds of exhibitions." Today, as American trade shows broaden their international presence, its here where she's working on making the exhibitions more diverse.


Staff reporter Rachel Brown can be reached at (323) 549-5225, ext. 224, or at rbrown@labusinessjournal.com .

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