Q&A Roswell Brayton, CEO of Woolrich

This summer Woolrich celebrated its 175th anniversary, as 2,000 people, including customers, employees and their families, gathered in Woolrich, Pa., to honor the country’s oldest continuously operating apparel manufacturer. Any company that lasts 175 years sees dramatic changes, and Woolrich — launched in 1830 making woolen blankets and socks — is now a global brand with a product mix extending far beyond apparel. In 2005, the company launched its own brand of bottled water, and it has seen many other changes just in the last decade.

SNEWS® spent some time chatting with Woolrich CEO Roswell Brayton Jr. about these changes, the health of the company, and what he expects for the future.

SNEWS®:With Woolrich having turned 175, talk a bit about the company’s current status. The company seems to be in a growth mode.

Roswell Brayton Jr.: The company’s health is great from a number of perspectives. The balance sheet keeps getting stronger, our bottom line has improved tremendously over the last four years, and we’re on that trend for ’05. From a financial perspective, we’re healthy. As far as employees and management, we have a team that works together as well as any I’ve ever seen here, and I’ve been here 28 years.

SNEWS®:Looking back over its history, highlight a few of the most important moves the company made to change its direction.
Brayton: When we began to source product other than from our own plant, it opened the world up to us. It allowed us to produce any apparel that was appropriate for us and not be limited to cut and sewn heavier product. It really started with us producing a spring line in 1975. We didn’t have knitting capacity, so obviously the only way to do it was to source. And that opened our eyes to the whole world that’s out there, first domestically and then internationally. And secondly, expanding our brand beyond just apparel. There have been lumps along the way. As we sourced worldwide, we had to come to grips with the fact that we had 11 sewing plants, and we didn’t need all of them. We had to close 10 plants from ’93 to ’99, which was difficult to do, but in the end it made the company stronger.

SNEWS®:You became president in 1996. What were your goals for the company then?
Brayton: I can’t claim that we were on the front end of developing the brand 10 years ago. Our goals at that time were to continue to establish the Woolrich brand in the apparel marketplace. My first objectives were to better control inventory and operations, become more global, and utilize the supply side and distribution network on an international basis. Then we kind of came to the realization that our brand had the potential to expand beyond apparel, that it was really a lifestyle brand. Shortly thereafter, we worked agreements to license the brand for things like hats and socks.

SNEWS®:So that was a seminal moment for the company.
Brayton: Yes, basically we’ve gone from being a manufacturing company to a marketing company to a lifestyle brand. It’s been two evolutions in a 10-year period.

SNEWS®:Woolrich has been making quite a few moves to increase its reach globally. (SNEWS® reported in May that Woolrich expanded its international brand licensing business, signing an agreement with Newman International Group of Melbourne, Australia, to be its agent for Australia and New Zealand. Woolrich already had licensing agreements in place covering the European and Japanese markets. With Newman International Group, Woolrich planned to explore a range of categories including apparel, footwear and fashion accessories.) Explain the role that globalization plays in your overall strategy.
Brayton: In the long term, it’s certainly important. Supply chains are global now, and the distribution is becoming much more global. Plus, the Internet introduces people to brands that in the past were specific to certain regions or a country. We’re on a growth trend with respect to our brand extensions. Things happening in Europe are tremendously exciting for us. I just got back from a sales meeting in Italy with our European partner, and they’ve grown tremendously each year for a number of years, and expect to do so again this year.

SNEWS®:Here in the United States, didn’t you recently set up a new division to procure government work?
Brayton: We have a new government contract division, which spends its time bidding on, and if successful, finalizing product to distribution channels of government contracts.

SNEWS®:Since Woolrich has one of the three vertical woolen mills left in America, it seems that would give you an inside track on government work.
Brayton: Fifty years ago there were over 300 (woolen mills);15 years ago there were over 30. Our mill has seen growth in the last two years, as avenues of distribution for our fabric have changed. There was a day when most of the fabric our mill produced was used for U.S. production of apparel. Most of the cut and sew is done worldwide now, so most of the mill’s production is not used for apparel anymore, but for military applications — blankets for the military, uniforms. Because we’ve hung in there and have the knowledge and the know-how, we’re one of the few bidders left on that type of production.

SNEWS®:Here in the United States you’ve also launched a new bottled water division. What was the reasoning behind producing bottled water? And pardon the pun, but are you concerned that things like bottled water might dilute the brand?
Brayton: I think it’s a natural for us. First, it’s a natural product coming from our own land, which we’ve protected for 175 years. Spring water is in demand, and we have the resources to do that, both in terms of the water and know-how of setting up manufacturing facilities. We certainly worry that we don’t want to dilute the brand, but I don’t think bottled water dilutes the brand at all. It’s not just bottled water — it’s spring water from our own land. And we pride ourselves on being a company that provides product for people to spend time in the outdoors, and people who are out there want fresh spring water to drink.

SNEWS®:Obviously, the types of product you produce have evolved quite a bit. What’s the main challenge in maintaining a brand image while evolving?
Brayton: It’s just controlling how far you go with respect to product and distribution channels. You can’t ignore the changes in people’s buying habits, but at the same time you have to respect the heritage of the brand, and the distribution channels that we’ve always emphasized. It’s always a fine line of changing with the times, which we have done, and hope we always will do — but at the same time understanding your heritage, and sticking to that where necessary.

SNEWS®:In reading a timeline of your company’s history, it notes that in 1971, when “Earth Shoes” and “Hot Pants” hit the market, Woolrich responded with the Mad Mod Vest. How much do you feel the need to follow trends?
Brayton: You have to differentiate between trends and fads. We for sure don’t want to follow fads. You have to follow trends, because society does change. If you go back to the origins of this company, it was producing product for people who worked in the outdoors — lumber men, trappers and hunters — people who spent their entire lives in the outdoors, mostly in the Northeast and to a great deal just in Pennsylvania. As you know, those industries have changed tremendously and left this area. But we still maintain that our product is authentic for people who spend time in the outdoors. It’s not so much people who work in the outdoors as people who spend their recreation time in the outdoors.

SNEWS®: L.L. Bean, a similar lifestyle brand, is trying to reach younger consumers. Are you also trying to do this?
Brayton: I think that’s true of us to a degree also. I think we’ve come a long way in the last three or four years as far as making our product more attractive to younger folks — meaning 25 year olds and 30 year olds — without losing its authenticity. We don’t intend to be cutting edge hi-tech — that’s not who we are. But we are functional, authentic outdoor product.

SNEWS®:Your sales to women have really picked up in the last few years. Is this another indication of how your customer base is changing?
Brayton: The consumer base has shifted a bit due to the strength of the women’s line in the last three to four years. Our business has moved to 55 percent women’s and 45 percent men’s. I see that in the next three years that will probably go back to being 50/50, based on the fact that we’ve put a lot of emphasis on improving the men’s line for ’06, and we’re getting very positive responses from retailers who have seen the ’06 line.

SNEWS®:Another thing you have in common with L.L. Bean is your use of catalogs for marketing. The cost of producing catalogs is expected to rise significantly. Will this affect how you market?
Brayton: We do eight catalog drops a year, and we’ll have to react to how much costs go up. But the consumer catalog is another way for us to target particular consumers — not to just sell product but introduce product to consumers who might not be familiar with what Woolrich does now. The result is more people will go into stores recognizing the Woolrich brand because they have seen it in the catalog. As you say, it’s an expensive way to market the brand, but it’s an effective way to specifically target your potential audience.

SNEWS®:There’s a trend in the outdoor market where natural fibers are becoming more popular. Will this benefit your brand?
Brayton: It always goes in five- to six-year cycles. And when a bigger part of our business was using the wool from our mill to produce fabrics for apparel, we could follow that five- to six-year trend pretty closely. Now that we source worldwide, it gives us the freedom to select whatever fabrics might be in demand. Sure, there’s a move to natural fibers, but I don’t see a change in growth of sales based on whether wools are popular at any given time. Because the selection of our product is so wide now, (overall sales) aren’t based on wool at all.