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REISS FINDS NICHE WITH MIDRANGE, URBAN CHIC

By Kerri Linden

Reiss is ready to make its mark as a global fashion brand.The U.K.-based midprice apparel chain, which entrepreneur David Reiss launched in 1975 as a menswear boutique on London’s King’s Road, is opening more stores outside Britain, a new accessories concept and a new e-commerce site.

Reiss, which has been selling apparel wholesale since 1992, opened its second retail outlet in 2000 in a 6,000-square-foot space in central London’s Market Place. The chain hired designers from the likes of Calvin Klein and Gucci and quickly gained a reputation for selling high-quality runway fashions at reasonable prices. The chain’s highest-priced items go for about $800, and most of the merchandise sells for far less. The Reiss designers do a lot of research and attend fashion shows all over Europe and Asia for inspiration.

Today the company operates 60 stores, mostly in Britain and Ireland, but it also franchises stores in Dubai, United Arab Emirates; Hong Kong; and Stockholm. The stores range from 3,500 square feet to 5,000 square feet, with the larger ones stocking both men’s and women’s wear (the smaller stores carry exclusively women’s). The closely held Reiss does not report annual sales, but Hoover’s estimates those at about $78.5 million.

Reiss plans to open as many as 250 stores worldwide over the next five years, 50 of which are to be in the U.S. and another 50 in Europe.

The women’s line has already made a splash in the U.S. since the first store opened in New York City’s SoHo in 2005. The store was an instant hit with young fashionistas, says Laurie Marco, the company’s director of U.S. retail. “New York has been immensely successful,” she said. “We find that the customer rarely even looks at price tags.” The chain’s U.S. same-store sales rose 6 percent between June and August.

In North America the company operates three stores in New York City and additional units in Boston, San Francisco and Washington. The company opened a 6,000-square-foot flagship on Robertson Boulevard in Los Angeles in May. A store in Short Hills, N.J., opened in August, and yet another is scheduled to open this month in Boca Raton, Fla. Most of the stores are freestanding.

In Asia Reiss plans to open two stores in China and also has franchise deals for a store in Hong Kong and one in Kuala Lumpur. Observers say the chain has a place between high-end retailers such as Chanel and mass-market ones such as H&M. “There’s a niche in the market for them,” said Faith Hope Consolo, chairman of the retail leasing and sales division of Prudential Douglas Elliman. “They compete with the Ann Taylor, Anne Klein brands. They’re for the more-well-heeled consumer.”

Reiss is expanding beyond apparel, too. It will be opening an accessories-only store in London’s Islington area this year. Marco says the company is also planning to roll out an online store this month.

David Reiss has retained 100 percent ownership despite buyout attempts from major retailers and private equity houses, including Icelandic private equity firm Baugur. He takes ownership seriously and stays involved with the day-to-day activities, Marco says. “David Reiss is extremely hands-on,” she said. “Because of this, we can be very reactive. If we find a site we like, we can go after it.”