Smooth trend to online sales

Emily and David Cooper in their Dunedin headquarters amid a growing fashion range Silkbody has...
Emily and David Cooper in their Dunedin headquarters amid a growing fashion range Silkbody has developed. Photo by Craig Baxter.
Marked changes to retailing during the past decade have worked in favour for Dunedin-based niche outdoor and fashion clothing manufacturer Silkbody, this week celebrating 10 years in business.

Fashion garments have overtaken outdoor clothing lines while dwindling numbers of recession-hit buyers and distributors in some of 20 countries at one point have since been replaced by growing online sales.

However, there have been hurdles aplenty along the way in adapting to changing markets, squeezed margins, the global recession and now the withering European financial crisis.

Father and daughter David (64) and Emily Cooper (33) started Silkbody a decade ago, having developed a unique "silk-spun" blend of silk (72%), merino (13%) and cotton (15%), with garments designed in Dunedin and manufactured solely in China, then distributed to outlets in at least 10 countries.

The Coopers have found forces, both negative and positive, seemed to conspire to make them adapt.

They had to change their initial business model as well as altering garment types and marketing. Adapting helped to level out peaks and troughs in the global retailing situation.

"The brand of merino is very strong and sells very well. We have a niche brand which people identify with," Mr Cooper said yesterday.

Ms Cooper said outdoor clothing styles, once 80% of sales, had been replaced by 80% of sales' being fashion items.

"We identified people were wearing Silkbody on an everyday basis, to the office.

"There was an older demographic [emerging] with up to 80% women," she said.

About two years ago, distributed clothing made up 50% of sales and online 10%, but that had switched around as distributors' ability to make sales waned in the face of recession.

In both scenarios, New Zealand retail still managed to account for 40% of sales.

Mr Cooper said starting a sophisticated website with a powerful engine and constantly working on it was the key to replacing distributors, and then getting product to recognised online markets, such as Amazon.

"At the time we had a lot of middlemen.

"Now, online, there has been a push to get people to the bus stop," he said.

The financial crisis in Europe, which is China's largest trading partner, was already being reflected in parts of Asia, Mr Cooper said.

"It is already affecting manufacturing in China. They are closing factories there and also in Vietnam," Mr Cooper said.

Silkbody has for more than 12 years nurtured close ties with up to three Chinese manufacturers, often family-based, and retains them for Silkbody products. Alternative manufacturing options were also available, Mr Cooper said.

Ms Cooper said it was difficult to gauge consumer sentiment about Europe online.

"Consumers still seem to be spending, but more selectively.

They want a lasting, quality product and there seem to be people out there with disposable incomes," she said.

The pair also launched Silkbaby about two years ago, which is showing "good growth prospects" but remains a new area to develop further with marketing, Ms Cooper said.

On July 4, the Dunedin Shanghai Association and Otago Chamber of Commerce host Mr Cooper to talk about his experiences trading with China, the business environment, agencies there, and business tips.

- simon.hartley@odt.co.nz

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