Vans Skates Out of Partnership For Latin American Shoe SalesWestwood
by Deborah Belgum
Skateboard shoe manufacturer Vans Inc., is closing down its joint venture operations in Brazil and Argentina after losing money this year.
Vans Latin America, a joint venture with Tavistock Co., accounted for the annual sale of 150,000 pairs of Vans shoes in Brazil and Argentina, said Andrew Greenebaum, Van’s senior vice president and chief financial officer.
Economic crises in both South American countries have made it a challenge to do business in these areas, said Greenebaum, who would not specify how much money the company lost on its joint-venture operation.
“It got very difficult down there managing through the currency devaluations,” Greenebaum said. “For the time and energy and the return we were getting, it was not worth it.”
He said the company would take a look maybe two years from now to see if they will resume operations in those countries.
Vans Latin America was responsible primarily for distributing Vans shoes, which are manufactured in China, to both small and large stores in Brazil and Argentina.
It was the latest in a string of losses the Santa Fe Springs-based company has experienced this year. For the year ended May 31, Vans reported a loss of $2.6 million, compared with net income of $15.4 million the previous year. Same store sales are down 3.5 percent for the year.
Vans shoes have faced stiff competition in the mass market and have been losing ground to basketball and retro styles.
Vans is also trying to figure out a way to attract more skateboarders to its 12 Vans skateboard parks that have not performed as expected.
While this may not be the greatest time to expand, Grill Concepts Inc. in Brentwood will go ahead with plans to open up a Daily Grill along the El Segundo/Manhattan Beach border.
Bob Spivak, president and chief executive of the restaurant chain, hopes his bistro will fare better than the Wolfgang Puck Caf & #233; that used to occupy the site. The caf & #233; closed last December after sales didn’t meet expectations.
“We’ve been working on this for the past three or four months,” Spivak said. “We obviously felt that the recession would be over and this would be a good time to open. But we believe this is a short-term economic downturn and it can’t alter our expansion plans.”
The 6,200-square-foot restaurant is located in Continental Park on Rosecrans Avenue where there are a host of other chain eateries such as P.F. Chang’s, McCormick & Schmick’s, and Houston’s.
The restaurant is a joint venture of grill Concepts and Continental Development Corp., which owns the business park. Construction, budgeted at $1.8 million, is expected to begin in August and the restaurant should open in December.
Only in L.A.
A new publication to showcase L.A. clothing manufacturers debuts in September. It’s called Made in L.A. and will be given away to small and medium-sized retail buyers throughout the country for free, said Jerry Sullivan, the new publication’s editor.
With an initial circulation of 3,000, the bimonthly magazine will encourage retail buyers visiting the city to buy from some of the hundreds of garment manufacturers located in L.A.’s garment district. The emphasis will be on the scores of Korean/American manufacturers in town.
J.C. Choe, who also publishes Pacific Textile News in English and Korean, will be the publisher. Advertisements will support the magazine’s costs.
Staff reporter Deborah Belgum can be reached at (323) 549-5225 ext. 228, or at
Beachwear Store Closes as Parent Files for Bankruptcy
By DEBORAH BELGUM
A competitive retail climate that has stores slashing prices to attract customers has taken a toll on the parent of Southern California specialty chain Beyond the Beach.
Pacific Eyes and T’s Inc., which operates nine Beyond the Beach stores in Los Angeles County, filed for Chapter 11 bankruptcy protection last week in San Diego.
After announcing it will reorganize, the 20-year-old company said it was closing its Westwood store and two in Phoenix. The Westwood store was the biggest loser in the Vista-based chain, having lost money for the past eight years.
Dan Goodman, founder and chief executive of Pacific Eyes, said he expects to be out of Chapter 11 by the end of the year and that the remaining stores will stay open. The chain has 35 stores, selling casual wear, swimsuits and sunglasses.
“Of course we took a hit like everyone after Sept. 11,” said Goodman, who runs the company with his wife, Sally. “But this is basically a refinancing situation.”
Goodman’s attorney, Michael D. Breslauer of Solomon Ward Seidenwurm & Smith, said that Wells Fargo Retail Finances decided to change the terms of its asset-based loans.
Those loans are determined by the price inventory goes for at full retail value. But as stores have been offering clothing at larger discounts, the value of the bank’s collateral was declining.
“We got pinched by Wells Fargo’s decision to change its lending limits,” Breslauer said, noting that the bank wanted to call in its loans and foreclose on inventory if the loan went unpaid.
The company, which recorded $34 million in sales last year, listed inventory at $11.4 million at retail and $4.56 million at cost.