The Fisherman and The Harvard MBA

An American businessman was standing at the pier of a
small coastal Mexican village when a small boat with just
one fisherman docked. Inside the small boat were seve-
ral large yellow fin tuna. The American complimented the
Mexican on the quality of his fish.
“How long it took you to catch them?” The American
asked.
“Only a little while.” The Mexican replied.
“Why don’t you stay out longer and catch more fish?”
The American then asked.
“I have enough to support my family’s immediate needs.”
The Mexican said.
“But,” The American then asked, “What do you do with
the rest of your time?”
The Mexican fisherman said, “I sleep late, fish a little,
play with my children, take a siesta with my wife, Maria,
stroll into the village each evening where I sip wine and
play guitar with my amigos, I have a full and busy life,
senor.”
The American scoffed, “I am a Harvard MBA and could
help you. You should spend more time fishing and with
the proceeds you buy a bigger boat, and with the pro-
ceeds from the bigger boat you could buy several boats,
eventually you would have a fleet of fishing boats.”
“Instead of selling your catch to a middleman you would
sell directly to the consumers, eventually opening your
own can factory. You would control the product, proces-
sing and distribution. You would need to leave this small
coastal fishing village and move to Mexico City, then LA
and eventually NYC where you will run your expanding
enterprise.”
The Mexican fisherman asked, “But senor, how long will
this all take?”
To which the American replied, “15-20 years.”
“But what then, senor?”
The American laughed and said, “That’s the best part.
When the time is right you would announce an IPO (Ini-
tial Public Offering) and sell your company stock to the
public and become very rich, you would make millions.”
“Millions, senor? Then what?”
The American said slowly, “Then you would retire. Move
to a small coastal fishing village where you would sleep
late, fish a little, play with your kids, take a siesta with
your wife, stroll to the village in the evenings where you
could sip wine and play your guitar with your amigos…”

Author unknown

Who needs pants really?

photos from www.style.com

With sub-freezing temps in New York this week, these boots serve both fashion and function. If someone would have described these proportions to me I would have said, awkward. Yet like magic, these are some of the most exciting/thoughtful looks out of Milan. Yum.

New Find. The Other You Blog

Check out this post, "Recession Hits: Slow Fashion  Follows"

” I think the word ‘luxury’ has been overused to mean expensiveness. Real luxury is personal”. Silvia Fendi, W Magazine, March 2009

The Golden Record

Derrick recently re-introduced me to the Golden Record. I am infinitely intrigued in the contents of this object/project and the potential story that could follow should it land in the hands (if they have hands?) of other life forms. For those who are unfamiliar, the Golden Record, a voice for mother earth, was created by the late astrologer Carl Sagan. Carl and wife Ann Druyan describe the project best as such:

If you could send a long message to such extraterrestrial beings - words, pictures, sounds, music - what would you say? How would you describe us? What would you leave out? Could you communicate intelligibly to very different beings with a wholly independent evolution? In 1977, at NASA's behest, a few of us had a remarkable opportunity to attempt such a (one-way) communication. Frank Drake suggested not a plaque, but a phonograph record. As described in the book, Murmurs of Earth, we designed and prepared the record to carry a rich message to the stars - 116 pictures and diagrams about our global civilization and our species, greetings, samples of the world's great music, the brain waves of a young woman in love and much else.

The "young woman in love" is Carl's future wife Ann Druyan. The record was created in 1977, the year Ann and Carl were falling in love. Ann was the subject of the brainwave recordings and as Dr. Helen Fisher has now illuminated, a very uniquely active brain high on the endorphins of love. Of all the thing we humans spew recklessly into the atmosphere, maybe this one contribution has the ability and reach to prove that despite it all, we are loving. intelligent creatures.

Questioning Publicly Traded Fashion

I'm not an economist/financial analyst although I frequently wish I was and more so now, so that I could properly support or refute the hunches I have about the sustainability of certain business models and industry trends. 

My question for quite sometime has been roughly this, "Should fashion companies go public"? 

In November 2006 Forbes printed an article titled, "When Fashion Goes Public"

which described some "winning and losing fashion IPOs" (ie. Donna Karan vs. Coach) in addition to explaining the impetus for such a move. The impetus most common being heirs who would like to cash out versus a founding designer wanting to create a global empire. 

Fashion in particular, seems like a silly IPO venture and investment. Bernard Arnault, CEO if LVMH might disagree but even he is heavily diversified among "luxury goods", not solely vested in fashion. I see fashion as a volatile industry that revolves around biannual seasons, designer whims, fickle consumers, precarious relationships with retailers and a product that loses integrity and identity when its pumped out like a widget to maintain "growth". When a fashion company goes public there is a fiduciary duty to the stock holders to provide growth of a certain percentage every quarter. To me it seems this growth would have to come at any cost including the integrity of product and the bastardization of the the brand. In addition to any questionable cost cutting techniques such as perpetual factory moving to find the cheapest labor and/or materials substitution.

So what happened to dividends? Couldn't a company get to a certain profitable point, where quality product is crafted, everyone is getting paid and the company is running efficiently, then instead of demanding "growth", as an investor you hold equity in a company with a sound balance sheet and receive dividends paid from real profits?

Am i missing something? I know I'm rusty, the last time I took an economics course or finance course was in 1998.

What's wrong with private, "small" and profitable? Why does everyone need or strive to be a global lifestyle brand? I don't understand that. 

My favorite example of a small and profitable is Christian Louboutin. The last chapter of Deluxe: How Luxury Lost its Luster by Dana Thomas

tells the tail of Mr. Louboutin graciously turning down investors on a regular basis instead focusing on sustainable profit, design, craftsmanship and his customer of which he has many loyal.

Mr. Louboutin does not want to answer to an investor, he has the luxury of serving his loyal customer, employees and complete design control. 

The collapse of our financial system has broadened my questioning beyond the fashion industry to:

-What types types of companies are most fit to go public?

-Why is bigger always seen as better?

-Is asking a company to grow a certain percentage every quarter realistic or sustainable over time?

-At some point doesn't the law of diminishing returns apply, the market become saturated and/or emerging markets cease to exist?

-Won't some day the entire world be industrialized/middle class majority and everyone will be drinking Coca Cola? A human can only drink so much Coca Cola. What happens to the stock?

Modern Appealing Clothing

THE cherry on the top of 2008, the year that the predatory capitalism virus binged itself to death by accidentally killing its host, was dubbed "The Christmas That Nobody Wanted." "I think everyone is finally burned out on 'stuff,'" my uncle Rick said. "People realizing that having 1,300 teddy bears didn't make their life any better."

I could not have said it better and will probably use this quote again taken from, Dress Wordly, Spend Locally in the New York Times.

The article introduces some to a shop in San Francisco named, MAC (Modern Appealing Clothing). I am assuming the title refers to supporting local "mom and pop", in this case brother and sister shops by purchasing timeless, quality and statement driven pieces ("slow fashion") from international icons of design such as Martin Margiela and Jil Sander.

In turn, MAC supports their local community via work with the Creative Growth Art Center, an organization that supports disabled artists.

I'm hoping one day soon there will also be locally or simply US crafted garments they are inclined to support. Maybe ZERO + Maria Cornejo for starts?

Regardless, I love Mr. Ospital's philosophy, his comparison of slow food to slow fashion, crafts person to farmer etc.

"The farmers honor labor. They sell the freshest stuff at its most perfect point in time. Disposable fashion is like fast food! We honor the hands that make clothes. Like 'slow food'? We think of our clothes as 'slow clothes.' We're not fashion victims. You want to find that jacket that is your most perfect tomato, and wear it for 20 years..."

RIP 2008

Yesterday one of my favorite blog-ish sites, Refinery 29 posted an article listing the fashion industry casualties of 2008. Jane Mayle being the most depressing for me. I pretend to know about her business model, but I do not know the intimate structure, although I am sure we shared some experience. Yet, from my outsider perspective she had these components that were both envious and what I see as the future of shopping culture. For example, a small curated shop in Nolita where she could present a tight clear message, take advantage of foot traffic on Elizabeth St., interact with her customer, possibly create specifically for them (atelier), test small batch production and be accessible to press. Closing the gap between producer and consumer/customer. 

In addition, the actual collection seemed very her; timeless, of quality and thoughtful. 

Read, not disposable and trend chasing. 

I very well understand that despite specific successes there are a tidal wave of components such a rising rent, Troubled domestic and global economies, charge backs, vendor compliance costs, failed production, rising costs of production and minimum requirements, vendor collection issues, etc. that can inspire the most creative to throw in the towel. Usually while making some sort of statement like, "I'm was just trying to design some beautiful frocks, f&*)!"

I can't help but think this is just the very beginning of the RIP list. After reading about all the $40 M plus losses for various department stores I wonder who will be left standing. If the department store continues to operate as is, if they will be around in a year? 

I have personally put my own line, ULURU "on hold" to take a more activist role in sustainable fashion/business models. My gut just told me that continuing to work (and work hard) on a small fashion label was a bad investment of both my time and $$. The risk compared to the potential return was not there. I decided after spending 8 years plus studying sustainable design, materials, business models etc. while watching consumerism and disposable fashion grow and the degradation of our own garment district that my efforts were better spent building the perfect petri dish for which a slow fashion economy might emerge.