EnTrends

Bill Sweedler graduated from Babson
College during a time of economic
hardship. There were not many
opportunities for people with finance
degrees. When Sweedler asked his
father for advice, the reply was simple.
"Go out and get a job!"

Sweedler accepted the way things
were and went out and did just that.
He landed a job with Polo Ralph
Lauren's home division as a sales
assistant and worked there for five
years. Sweedler credits much of his
success today to the experience he
had with Polo.

Eventually, Sweedler felt the urge to
venture out on his own, as do all
innate entrepreneurs. He approached
his father once again. The senior
Sweedler represented a domestic
knitwear company and had introduced
the polo shirt to such companies as
Land's End and Tommy Hilfiger.
Working together, the Sweedlers
began building a department store
private label business manufacturing
polo shirts for a variety of different
retailers.

After six months working with his
father, Sweedler felt that the market for
domestic manufacturing was aging.
His customers complained of late
order arrivals, lower quality and higher
pricing than overseas competition.
Sweedler knew that he had to do
something or risk going out of
business.

"We tried to convince the owner of
the factory, who had a couple
thousand employees, that things had
to change. He was committed to
American manufacturing, which was
gallant, but he didn't see the forest
from the trees."

Sweedler tried to convince the factory
owner to implement an 807
restructuring which would allow
manufacturing to go offshore while
retaining cutting and packaging jobs
in South Carolina. The owner still
refused, hoping so save all the jobs.

After failing to persuade others to
change the company's operational
structure, Sweedler decided to venture
out on his own for the first time. In
1994, he formed his own apparel
company called Windsong.

Sweedler says, "It was a huge change
financing the business, buying pieced
goods and having expenses.
Suddenly, we had to deal with massive
cash flow issues."

While it was difficult for Sweedler to
get the new business off the ground,
he prevailed. In fact, he wound up
restructuring two of his primary
clients, Tommy Hilfiger and Dillard's
department stores, as 807 businesses.

Unfortunately, the factory owner that
Sweedler worked with originally
realized that he could not compete
with overseas manufacturers. He was
forced to shut his doors. Almost three
thousand employees lost their jobs.

In 1995, Sweedler decided that private
labels were too low in margin. He
started looking for an established
brand to license. It came under the
name of Alexander Julian. Under
Sweedler's guidance, the company
earned almost $60 million in revenue in
1996.

However, Sweedler felt the only way
to continue expansion was to acquire
a brand name, rather than licensing
one. He bought his first brand, Pivot
Rules, in 1998. The brand had done
very well in stores such as
Bloomindales, Nordstrom and Neiman
Marcus. Unfortunately, it just did not
work out. Sweedler says that was one
of his first mistakes. The key to
profitable growth was not simply
buying any label. It was to find the
right ones.

In 2000, Sweedler re-trenched and
started to look for brands to license
again. He formed Allegiance Apparel,
focusing on loungewear, underwear
and sleepwear. New license
agreements were signed with Bill
Blass, Geoffrey Beane and other

companies over the next two years.
The new division grew to $40 million
in revenue.

In the meantime, Sweedler kept up his
search for underdeveloped or
mismanaged brands to acquire
outright. Joe Boxer happened to be
one of those brands. The company
was on the verge of bankruptcy. In
March of 2001, Sweedler acquired the
brand. He knew that the company had
massive potential for sourcing and
savings.

Sweedler says, "Logistically, the
sourcing department at Joe Boxer was
paying 25 to 30 percent too much for
goods. They just weren't set up in a
streamlined entrepreneurial way that
we were. Our overhead was much
lower and we knew that there would
be an immediate savings."

Having acquired the brand, Sweedler
immediately began looking for growth
opportunities for it. He approached
Kmart and signed them to an exclusive
multi-year sales contract, much as the
retailer had done with the Martha
Stewart line.

"Mossimo and Martha Stewart were
pioneers in this field of creating these
brand partnerships and we saw this as
an opportunity. While we didn't have
intentions of doing it initially, when
we met with Kmart executives we were
looking to do a derivative brand,
something simply by Joe Boxer. The
people at Kmart made the end deal
possible," says Sweedler.

On August 14th, 2001,
Windsong/Allegiance Apparel Group
announced the long-term exclusive
agreement that would bring JOE
BOXER merchandise to Kmart's 2,100
retail outlets across the country. Joe
Boxer would offer 120 different
product classifications from home
products to underwear. Kmart
Chairman and CEO Chuck Conaway,
Joe Boxer CEO Bill Sweedler and Joe
Boxer founder Nick Graham, made the
announcement at the opening bell