Doug Vesling, president of C-Merit Corporation, makers of Gotta Flurt, Evos and Nord Trail, discusses how proven formulas, along with a few creative twists, are a recipe for success. By Greg Dutter
Doug Vesling has been around the block when it comes to the footwear industry. With an extensive background in retail, sales and wholesale he has the unique perspective of understanding the industry from three key angles. He cut his teeth working for Value City’s leased footwear departments where he learned the fast-paced world of discount retailing. He worked his way up to buyer and eventually assumed similar duties at Famous Footwear, learning alongside Brian Cook. Vesling then made a leap into wholesale where he made his mark at American Sporting Goods during a successful 10-year run alongside Jerry Turner. And before coming to the helm of C-Merit, he launched his own rep firm that covered 16 states.
You might say Vesling has pretty much seen and heard it all: the brands and trends that have come and gone; the selling strategies and principles that remain true despite the passage of time; and the retail formats of old, new and ones in need of change. The fact is Vesling is a student of the industry. He’s not just a number cruncher. But he does have a firm grasp of retail math and can relate to a retailer’s need to come out ahead at the end of each day. He’s been there, done that. And while Vesling is not exactly a designer, after two decades of buying and making shoes he knows what makes a shoe sell through as opposed to just sell in. Having worked with reps as well as running his own agency, Vesling understands the critical—albeit increasingly lacking—human ingredient necessary for long-term success in this business. Sure, great product is a must, but without an ability to effectively manage it all the way to sell-through season after season, a retailer can always turn to another “great” product. “Most buyers want to go to bed at night knowing that their reps are really working for them,” he says. “That they are there to warn of any issues and will be there through the successes and failures.” Vesling adds, “That’s what I wanted when I was a buyer. I’d give you all the orders in the world if you truly were a partner in helping build my business.”
Vesling has also been around long enough to know that the industry is in need of some freshness—new twists, if you will. Aside from e-commerce, he believes the industry is ripe for some new approaches. “We need to take a hard look at what we want to be and reinvent ourselves because we have been stuck on doing too many things the old way,” he says. “The way product is made, shipped and sold at retail, as well as the store formats, could benefit from a fresh approach.”
That’s the strategy Vesling has taken since being named president of C-Merit about two years ago. All three of the company’s labels offer a fresh take on staple categories that give their respective audiences that added incentive to buy. Gotta Flurt made its mark by spinning the Converse aesthetic into a more girly-girl direction with wild patterns, bold colors and edgy materials like sequins, glitters and frayed edges. Over-the-top is the brand’s design ethos, which has been kicked up another notch this season with its exclusive license for Twist Me, reversible tongues that give wearers added style versatility. Basically, Vesling knew Gotta Flurt needed an added twist if it was going to get placed at retail. “Initially, we were too much like Vans and Converse,” he admits. “So we addressed the wow factor and I said, ‘Don’t even show a style to me if it doesn’t produce that response.’” Thanks to plenty of dazzle, the brand is now getting placed where many already carry those other brands And, Vesling reports, sales are up more than 25 percent this year. The success has also enabled Gotta Flurt to expand into new constructions and styles, and Vesling believes it’s well on its way to becoming a lifestyle brand. “My wife wears it because she loves the colors,” he notes. “And while the target age range is kids to around age 22, we will continue to develop new products for anyone who is interested because no one wants to look old.”
The success of Gotta Flurt spawned C-Merit’s decision to launch Evos (short for “evolution of style”). The premise being that a fresh approach on a girls’ staple could work in young men’s. “Evos is a fusion of athletic and casual but done in a cutting-edge way,” Vesling notes. For example, the current popularity of Sperry’s boat shoes done the Evos way incorporates the latest colors and materials and it may be a four-eyelet design. So far so good for the line that debuted this year and, Vesling notes, received a strong reaction at the recent Outdoor Retailer (OR) show. “Thanks to the resurgence of athletic styling, specifically colors, those looks are bleeding into the casual market,” he notes. “Now we are seeing casual companies take the traditional white buck, for example, and put five different colors on it, which bodes well for Evos.”
Similarly, Vesling says the idea behind the Spring ’13 launch of Nord Trail is to put a fresh spin on the traditional day hiker at a more affordable price ($45-$80 suggested retail). Both traits run counter to the overly pervasive earth tones found in many outdoor products as well as the higher end brand positions. The value aspect is particularly important today, he says. “It’s like everyone has been going off the deep end on pricing in the outdoor segment. And anyone not at the top tier has to be value-driven for your consumer as well as offer high profit for your retailers,” he says. Vesling reports the response to Nord Trail at OR was encouraging. “It was better than expected and we placed plenty of orders,” he notes, despite showing in the new products zone. “But that’s also why we met with a lot of independents that shop that area trying to find something that the majors don’t carry yet.”
Perhaps C-Merit’s booth location at OR was another twist of good fate for a company that relies on proven techniques topped with that little something extra. The combination, Vesling believes, is the difference maker to becoming a meaningful player in the market. And despite the many obstacles and challenges all start-ups face these days, C-Merit is on its way to that goal. “Our economy has been a disaster, but we are still launching brands and growing when most think that isn’t possible,” he says. “And while I wish market conditions were better, we have a team of veterans who underatand what it takes to make a go of it and we are teaching our young recruits how to do so as well.”
How did the C-Merit job offer come about?
Actually, the process started back when I opened my rep agency and Gotta Flurt was one of my first accounts. I knew all the majors and also knew that there’s a whole industry of great product that doesn’t have brand recognition. They just need an opportunity to get in the door. Thanks to those relationships, I was able to start building a business. During that time, our owner (Jeffrey Jia) pulled me aside and asked if I could do what I was doing for the rest of the company. Well, I like taking a young business and putting some practical applications to it. I was also fortunate to hook up with an old associate, Laurence LaHaye (vice president of product), and we put together our business plan and here we are.
Was it a difficult decision to close your rep agency?
Yes. I had started that agency after leaving American Sporting Goods. Originally, I planned to work for another wholesale company, but then the market crashed and I sat on the sidelines for about a year watching the industry change. My father was also terminally ill with cancer and, for all of those years I had traveled so much for work, I realized I never spent much time with him. So I told my wife “Dad and I are going to hang out for a while.” And she said what better time than now. We got through his chemo treatments together and we traveled to watch my son’s college baseball team play. We did everything together and traveled to as many places as we could. Sometimes, between innings, I would be making a call to a company about a job prospect. I came close on a couple of offers, but I decided to start an agency instead.
What attracted you most to taking the reins of C-Merit?
Basically, it gave me the opportunity to do what I had been doing at American Sporting Goods, which I loved. The business model we put together there is primarily what we are doing here. It all starts with great people and their ability to establish solid relationships. Back then I hired the best reps available, and all of them today have impeccable reputations, trust and followings. It’s no different today. I always tell my reps that they really work for their retailers and not me. I want them to represent their best interests. It was a great model and it worked very well and there’s no reason why it can’t again.
Second- through fourth-tier brands can’t just walk in and get placed these days. You have to build those relationships and earn their respect and trust. That goes way back to my retail days and understanding what buyers go through in putting a budget together and dealing with margins, sell-throughs, aging of goods, etc. I know what they go through because I did it, too. That’s why our reps go way beyond being order-takers and are trained to be more like business managers who are valuable assets to their accounts. Our reps are required to know that account better than anybody. Fortunately, I have been slowly acquiring some old friends to fill out our rep force as well as some new faces that I feel can get on that learning curve quickly. Because once you have your factory, salespeople and distribution in place, the rest is relatively easy.
The most difficult challenge is understanding your retailers’ respective businesses and gaining their trust. We are multi-branded and very adept at all of the blocking and tackling required, be it the design, manufacturing, marketing, purchase orders, shipping—everything that needs to be done. Getting orders, for example, is not nearly as tough as managing everything else.
Where is Gotta Flurt in terms of its brand positioning?
We are only scratching the surface as our distribution is still in its infancy. But the growth has been solid. For next season we will probably add another 30 to 40 percent of volume because of our aggressive color story and how much we improved on our Twist Me reversible tongue program. In regards to the latter, we started out with a couple of SKUs and are tripling it for Spring ’13. With respect to any new brand, it obviously takes great product as well as a strong team and business plan that offers profitability for both sides. Of course, if I didn’t have those relationships, I don’t even know if they would open the door for me.
Can relationships outweigh the product ever?
You often don’t get that opportunity without the relationships, and you only get that opportunity if you have paid your dues. That’s why I’ve always been indebted to the retailer. In fact, our friends are our accounts. To do it right in this industry, you have to be constantly traveling. The guy who wants to be home every night probably isn’t going to accomplish much. That’s why I want hired guns—people I know that when we put into battle they will win. Along those lines, we just doubled our sales team with the addition of some great people. I know I can’t do it alone.
Where do you envision Gotta Flurt in three years?
It will be a lifestyle brand. It might become a stronger children’s brand, as well. We will also offer spinoff collections, like the Blush Collection by Gotta Flurt, which will allow us to go into other categories and constructions. But only if it’s right for the brand. For example, we know the brand can’t translate into men’s, so that’s why we created Evos. If we are going to be knocking on major retailers’ doors, I want to eventually have a business for every one of their buyers’ needs like at American Sporting Goods. It was a shopping bag approach where they can check off all of their needs. Evos’ big coming out party will be the fourth quarter of this year and next spring.
It seems like good timing as the men’s category has been embracing more fashion of late. Do you agree?
Yes. Thanks, in a large part, to the resurgence of the athletic business—specifically the running segment—it is ushering in a lot of new colors and technologies. The Olympics, in particular, saw the athletes sporting some really crazy styles. In general, the athletic category gets away with everything, which is good for our industry because it creates a ton of buzz and eventually influences other market segments. And that’s a welcome sign because we have gotten too traditional and misguided. Men’s dress, in particular, had become the definition of boring. And even casual wasn’t allowed to stretch much beyond a boat shoe where the big story was distressed leather. There was little im tje way of a technical story. But for the footwear industry to be really successful it needs the athletic brands driving the market. And those brands are absolutely doing that again. Thanks to those influences, the color and technology stories are now bleeding into dress and casual.
Like minimalism, for example. That’s a wearable tech-based story adaptable to many categories.
Absolutely. But, remember how the story used to be all about torsion control and cushioning? Back then everyone had what I called their “flubber.” Some of those technologies worked and some didn’t. The more visible it was—the more you could touch and feel it—the more successful it was. Now it’s the opposite story. You’ve got running shoes in a $100 range that are just lightweight with compression-molded EVA that are just colorful. It’s all in the marketing.
How does Nord Trail fit into this less-is-more-colorful market landscape?
Its niche is what we describe as the day hiker who will never climb Mt. Kilimanjaro. This customer is just looking for outdoor fashion and basic function, but doesn’t want to spend an arm and a leg for it. My first phone call isn’t to R.E.I., because my shoe isn’t going to hold up to 500 below zero. That being said, we signed Ronnie Kovach, the host of Fox Sports’ Fishing Ventures, to an endorsement deal. He gives us credibility by wearing our product as well as terrific exposure every Saturday morning when outdoor enthusiasts watch his show in Western states. What I also like about the program is that it focuses on the outdoor lifestyle aspect beyond fishing. You’ll often watch him walk into the campsite and then there are scenes of him fishing. He’s really good about tying the whole outdoor experience in together.
What about Nord Trail’s amped up fashion for women?
We’ve incorporated a strong story in terms of materials and colors because I think there’s tremendous opportunity in women’s hiking since they’ve all been pretty much boring takeoffs of men’s styles up until now. If you walk into a Bass Pro shop the shoe wall looks like someone splashed a bucket of brown paint against it. During OR we had more women grab some of our colorful styles and just say, “Wow. I’d love to have a pair of these. When can I get them?” They included exhibitors, buyers and the help staff. They loved the colors and quickly discovered that they are lightweight, functional and come in plenty of low-cut versions as we focused on the trail running silhouette. There are lots of people walking for exercise and many are getting tired of walking on the road and are moving over to trails. In fact, a lot of charity walks are switching to trails.
Do you envision adding more brands to C-Merit’s portfolio?
Absolutely. We had a nice introduction with sandals two years ago and it’s a major push for us again this year. So maybe it becomes a brand of its own. But we’ve got to work within our strengths. If we don’t have a factory base that can guarantee what we promise then it will fail either by our retailers not getting deliveries on time or receiving poorly fitting product. As we expand the portfolio we have to make sure all the factors are built in to support each brand correctly.
What’s your take on China’s sourcing capabilities going forward?
People who think that they can pack up and leave China are wrong. There are now different regions that you have to travel to, but you can get to them easier than before. It’s like they put up roads in a day, bridges in a week and skyscrapers in a month. I can travel that country via planes, trains and automobiles comfortably and on time. In fact, I visit 10 to 12 factories in a week every time I go—and that’s in three different regions. You couldn’t do that 20 years ago. So I think as they continue to build their infrastructure the industry will largely remain there. I don’t envision a mass industry exodus any time soon.
What would you consider C-Merit’s greatest asset? Is it speed?
I would say our ability to listen and react quickly is a very attractive asset. We don’t have to wait for four or five people to get back to you in order to make a decision. We empower our team to make those decisions quickly. That and our knowledgeable rep force. Our representation has to be our eyes and ears because I can’t be everywhere. We’ll travel to pretty much anyone who will see us. And when we set up shop in their respective locations we always ask them what they think. We want their feedback. And, having been a buyer, we hope they appreciate the fact that you never know what the next big brand is going to be. That’s why I always made it a point to try and see everyone. Unfortunately, not as many buyers today are willing to cover as much ground.
As a former buyer, any advice you might have beyond looking?
Buyers need to not be afraid to try something new. The fact is with respect to many stores today you can walk in and if it wasn’t for the name outside you wouldn’t know which was which. People say there is safety in numbers, but if everyone is carrying the same stuff they will all either have success together or fail together. In the meantime, they’re guaranteed to experience price compression because one guy is going to find a way to be priced lower than the other. That’s why retailers who may not carry the big brands can still be successful because they offer a unique selection and provide great service in a cool environment. JCPenney, for example, is making changes. And while they are catching hell for some of it, at least they are trying rather than stand pat, which was not working.
Evolve or die, right?
Retailers must define and work within their strengths. They should find a niche and continue to perfect it. And it would help to really listen to what consumers are saying because, for example, there are many categories that are growing that brick-and-mortar retailers don’t even touch. But if they decide to get into it they might do extremely well.
Slip-resistance shoes, for example. Look at the growth behind that category and yet many retailers still don’t even bother to carry them. Look at e-commerce sites and how many retailers still don’t have a web site where they can fulfill orders. There are some big-name companies that still don’t. It’s those types of programs that they need to do if they are going to stick around.
What’s your biggest goal for the remainder of this year?
To continue to tell people who we are. Retailers are increasingly coming into our booths at shows, thanks, in part, to advertising in publications like yours, and are checking us out. Product placement is the biggest challenge. The more we can place orders, the more awareness will be created, and then an increase in demand follows.
What do you love most about your job?
The people. I’ve been fortunate to have had worked with some unbelievably talented people—from buyers to top-level executives—where none of us would be where we are at today without each other. Unfortunately, some of them are aging out of the industry. I just hope that the next generation coming through understands that it’s a give-and-take business and not always about the money. Also, that it’s a great industry with great people in it.