Seeking Some Heat

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Seeking Some Heat
President Eric Tung at Fera International’s office in Torrance.

Torrance snow sports apparel maker Fera International Corp. is sliding away from traditional ski clothing.

Faced with the declining popularity of skiing – and the consolidation of retailers catering to that market – the 35-year-old company is launching a line of apparel that can be worn just as comfortably off the slopes.

Eric Tung, the company’s president, said when he took over Fera from his parents six years ago, he saw the ski market becoming less accessible, especially with an ailing economy.

“It’s an expensive sport which has outpaced inflation. That’s my impression,” Tung said. “If someone were to get invited to a weekend skiing, it’s an investment. It’s an excluding segment.”

By making his new product line usable off the ski slopes, he said, Fera’s clothes effectively will become more affordable.

The new line will include jackets that are more fitted to the body and water-resistant pants that have the silhouette of jeans, a product Fera calls active jeans. Designed at the company’s Torrance and Hong Kong offices, the clothing is manufactured in China. Sold online and through specialty and chain retailers, Fera clothing sells for between $60 and $250, depending on the item. The new line will make its debut for the fall 2014 season, though some of what he calls lifestyle pieces are being sold this season.

“They look street ready but these are technical performance wears,” Tung said. “You can walk around Manhattan, do yoga or go skiing and still have all the weather protection.”

He did not disclose the family-owned company’s annual revenue but said it was less than $5 million.

The 10-person company had been working on the new line for the past two years, but the process of branching out into new segments has been in the works since 2008, he said.

According to the Snow Sports Industry Association, a Virginia trade group, participation in alpine and cross-country skiing has been in decline for the last two seasons. Just 8 million people participated in alpine skiing in 2012-13, a decline of about 25 percent from the 2009-10 season; the number of cross-country skiers fell about 20 percent in the same period, to 3.3 million.

Fera, considered a midrange niche brand, has a significant presence in resort boutique shops, which are directly impacted by declining slope activity, whether the cause is a sour economy or inclement weather. To add to those factors, many of the shops have a tight seasonal selling window.

Compounding the challenges, the number of brick-and-mortar ski and snowboard specialty stores, which account for the bulk of the retail outlets that carry Fera product, has declined about 20 percent over the last eight years, the snow sports association reported.

Dealing with large national stores, such as Dick’s Sporting Goods Inc. of Coraopolis, Pa., could mean lower margins for companies like Fera because the big chains have greater negotiating power – especially with specialty stores dwindling.

So as existing distribution channels narrow, Fera’s new line is designed to help make the company more versatile. Tung said by having more products that can be worn in different settings, the company can market its goods to retailers that traditionally would have overlooked Fera.

“We want to broaden our distribution because there are opportunities to take and layer our clothes into a different context,” he said. “We could get into a women’s shop with an outfit that could be cute and functional.”

Well-worn path

Tung’s pivot toward a broader market is similar to what major active wear companies have done in the past decade.

Ventura hiking apparel company Patagonia Inc., Canadian yoga apparel company Lululemon Athletica and VF Corp.’s North Face brand have all seen success in creating functional apparel that can be worn every day.

Fera’s new line will be designed to be less rugged, more tailored and influenced by street wear. Tung said it is part of a trend that has been helped in part because casual clothing is becoming more acceptable to wear every day. He pointed to the popularity of yoga pants and how those are now worn in all situations.

“The stuff is comfortable, it fits nice and it’s stylish,” he said. “Living in L.A., yoga pants are weekend apparel.”

Sales of snow sports apparel has consistently made up more than onethird of the products purchased at specialty stores, tallying domestic sales of more than $600 million in the 2012-13 season, up 11 percent from the 2004-05 season.

“Apparel sales have gone up,” said Kelly Davis, director of research for the snow sports association.

“We’re seeing a lot of people purchasing snow sports apparel who never go skiing. People are wearing highly technical apparel to Starbucks. There a lot of people are going to places like REI for their casual wear,” Davis said.

Judy Gray, co-founder and co-organizer of the annual Ski Dazzle convention in Los Angeles, said she agrees with Davis’ sentiments and observations about the industry.

Gray said that while the industry never fully recovered from a decline that was felt in the wake of the 2001 terrorist attacks, she’s had some of her best shows in the past five years. The convention sells about $6 million worth of snow sports gear and lift tickets each year.

“Though the number of outlets has decreased, the interest is still there,” she said. “I have seen stores like Bloomingdales and Nordstrom offer ski apparel online. I was really surprised.”

Tung, who was a senior analyst for the former Hambrecht & Quist investment bank in San Francisco, returned to Los Angeles to run the family business with his sister Patricia, sees opportunity in Fera’s new course.

“Let’s take a step back from looking at this from a ski lens,” Tung said. “We see this encouraging trend in health and fitness. We’ve seen opportunity for fashion meets function with companies like Patagonia, with pieces are that really technical and function oriented. We look at active athletic wear and we see a space.”

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