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Published on November 3, 2007

This has been one of the toughest years for fashion apparel - even worse than last year, when the market dropped 12 per cent - with consumers tending to shop less out of concern for the economic and political uncertainty, the company said yesterday.

"We've seen a slight improvement in local spending and consumer sentiment since July. However, many companies selling fashion apparel are still suffering from the tough market situation and have been able to make only small growth so far, less than 5 per cent," said chief operating officer Mathew Kidoharn.

Mathew said the company two months ago launched Esprit's biggest brand-refreshing campaign, called "What's New", consisting of price reductions and accelerated product launches.

The company reduced the retail price of Esprit clothing about 20 per cent and sent about 50,000 pieces of new products to Esprit stores each month.

"After introducing the campaign, we saw sales of Esprit products increase 13 per cent over the past two months. This is a big improvement on previous months, when sales dropped 9 per cent from the same period last year," Mathew said.

The company expects the campaign to lift sales of Esprit apparel and accessories to show full-year growth of 7-10 per cent, compared with the flat growth predicted before, he added.

Meanwhile, Chattaweekij Corp, a licensee of Japanese clothing brand Crocodile, will wait to see the political and economic outlook after the December 23 general election before deciding whether to spend at least Bt100 million to build a new plant and bring in new licensed international brands.

Managing director Somsak Chataweesak yesterday said the company was worried about the decrease in consumers' purchasing power resulting from rising inflation.

However, Chattaweekij is still looking to bring in new brands, including from the US and European countries like Switzerland.

All of the brands being considered feature casual styling and target middle-market to high-end consumers. If the company eventually selects one, it will have to allocate Bt50 million to Bt100 million as initial investment.

Chattaweekij is also still searching for a site to build a second factory, which will double its production capacity. Its current plant has already reached full capacity.

Marketing manager Chalidda Luxameesathaporn said many of the small Crocodile product lines, such as casual clothes, shirts and innerwear for men and leather accessories, would be made main lines. To do this, Chattaweekij will allocate Bt150 million to Bt200 million to restructure its organisation and double the number of employees from about 200 now, particularly in the Design Department, between next year and 2010.

The company yesterday announced the launch of a brand-awareness campaign for Crocodile with a television commercial for its new Stand Up collection.

It also wants to change the perception that Crocodile clothes are only for older folk, since the new collection has 50 designs for two target groups - those aged 20-28 and 25-45 - who want to wear trendy clothes that also express reverence for His Majesty the King.

Somsak said this was an opportune time for Crocodile to build brand awareness, since other brands were spending less on promotion, due to the economic downturn.

Chattaweekij will add up to 20 more Crocodile outlets next year to the present 50, each at a cost ranging from Bt5 million to Bt20 million.

Somsak said that next year's marketing budget would be at least Bt10 million. The company has already spent Bt30 million this year.

Plans to start exporting to the Indochinese market will be delayed, because of an influx of cheap products from China and Vietnam. The company wants to ensure it has the right marketing strategy before entering the region, starting gradually with Laos next year, he said.

Somsak said that the company should be able to double its sales to Bt600 million next year. Expected sales of Bt300 million this year will represent an increase of 38 per cent from last year.

 Kwanchai Rungfapaisarn,

 Nitida Asawanipont

 The Nation