Profile of Liz Claiborne, Inc.

Liz Claiborne, Inc. is a New York-based designer and producer of women's clothing, the largest such producer in the world. The company markets a complete line of sportswear, professional clothing, costume jewelry, accessories, and cosmetics under different names and also a line of men's sportswear.

Liz Claiborne occupies a particular niche in the clothing trade. The company's clothing is what is known as "accessible" rather than "aspirational." The clothing is thought of as well-designed and functional but definitely not upscale. In 1986 the company became one of the Fortune 500, one of only two companies started by a woman to achieve that level. The company's best year was 1990 when it shipped 60 million items to 9,000 stores in the United States, Canada, and Britain. Over the past decade, sales have increased at an annual rate of 36 percent, reaching nearly $2 billion; profits have increased annually at 42 percent to $203 million. All this was achieved during a period of recession, and the company has in fact benefited from the recession to become the most powerful brand in the business. This is because the clothing with this label is professional in appearance and comparatively low-priced.

In the 1980s, the company changed from a basic sportswear business to a multifaceted fashion house. The company had only one division 12 years ago, while today it has 19. The company's original business was regular-size women's sportswear, and last

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ccess derived from more and more women going to work, and with this large number of working women, billions of dollars would be spent on clothes. The second reason for its success, says the company, was Liz Claiborne herself, for she understood the business and the needs of the clientele (78). The company was able to determine the proper timing for the introduction of new lines and for developing new products. In the belief that a line can be too widespread so that the consumer gets tired of seeing it, the company began to diversify in 1982, adding at that time a line of accessories licensed to use its name for scarves, gloves, and belts. Liz Claiborne bought this company in 1985. In 1986 the company introduced a line of perfume called "Liz Claiborne." Sales for these divisions increased quickly. The company has also used business innovations to good advantage. In 1990, the company announced that with its spring line, it would give a 10 percent discount to retailers who pay for their merchandise within 10 days of receiving it. The discount is 25 percent more than the 8 percent industry standard and does not apply to makeup, accessories, or men's apparel. It affected 70 percent of the company's business and cost nearly

Category: Business - P