The Exchanges, every show

Q So, you know, I think, I look at a necktie. I haven't worn a necktie. I can't remember the last time I wore a necktie. But, uh, it doesn't seem from the outside like a particularly complex product. Piece of, of apparel. Like, it's just a, you know, it's the shape, and am I wrong about that? Is it a lot more complex than people realize?

A It's not. I mean, it's a pretty basic item, but the components really matter. One thing that, uh, most guys will tell you is they like the way a tie ties, or they don't. And a lot of that has to do with what's inside it, the interfacing, which we cut apart all the ties that we had, what we liked, what we didn't like, and why. The other thing that you people notice is, um, how the silk feels, you know, what the finish is on there. Is it gummy? Is it not gummy? And as you pull the tie tighter, a lot of people would like a little bit of a contour, like a little curve to the surface of it. And we discovered that that had to do with the way in which you cut it and which way the, the weave was going. Um, and we found that a lot of the ties that didn't tie well We're all done one way and the more expensive ones were done the other. So we emulated what we liked and walked away from what we didn't.

AI assessment note: “It's not. I mean, it's a pretty basic item, but the components really matter.”

Q years, and he's like, he's maybe not impolite, but he's probably looking at you guys and thinking, what do they know about this business? And, and he might even have an, uh, an opinion About, about the designs, and he might even say, you know, this is really not, these are things that just aren't going to sell. Like, is, did you, do you remember coming across anyone like that?

A We did for sure. We had one guy who said, you know, we were very pedestrian. We have one, a lot of people say, you know, we're just not selling ties. And you're totally right. We had no experience in this industry. And, you know, a lot of brands were started by people who were in the industry, you know, and had an idea and they, they acted on it. So for us, what we had to do was to show them that we were eager to learn. And by spending time in their stores, like stocking their shelves, helping sell on the floor, just by hanging out and learning through osmosis, we earned their respect, and with that respect came their willingness to give us a chance.

AI assessment note: “We did for sure. We had one guy who said, you know, we were very pedestrian.”

Q I read, well, I'll get to this question in a sec, but I read that within three years, you guys are doing a million dollars in sales, which is kind of crazy. Before we, before I ask you about how you got there, just, can you just give me the breakdown, like roughly, of what the margins were? I mean, what did it cost you guys to make a tie?

A So the ties, I mean, just the cost of the tie itself, the physical tie and the components was probably somewhere around 12, 13 dollars, something like that. And we didn't realize it at the time, but it was a very high profit margin product. It also had quite a long runway in terms of apparel. It was less seasonal. Like we could make the same print. In fact, we still make the same print, some of the same prints we did 20 years ago. So they, the pro, the inventory lasted longer than typically for apparel. And it also took up a very small amount of retail space. You could hang, you know, a bunch of ties on a wall, and it didn't take up much space. Uh, and there's also no sizing.

AI assessment note: “physical tie and the components was probably somewhere around 12, 13 dollars”

Q And how did you identify which stores you wanted to go to? Like, this is the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the,

A That was a hard thing to do, to be totally honest. There are two ways we found out about good accounts. One was most of the customers we had on Martha's Vineyard didn't live there. They were visiting. So they would go back to wherever they lived, and any customer that we had met or knew somebody in different places, we'd ask them, do you know of a good outlet for us in your town? The other thing we would do is we would find sort of similar brands, and we'd get their catalogs or whatever collateral we could find, and And we would check, you know, where are their products available? Because people would often list their wholesale accounts in the back of their catalog. So we would sort of retrace the steps of somewhat similar brands. And, you know, in terms of reaching out to them in advance, we did a lot of gifting of our product. It was a very easy thing to do. So we would just pop a couple of ties and a little, you know, color Xerox catalog that we put together. In an order form and just send it to people, just cold call. That was very uncomfortable calling people while trying to be a salesperson when you're really not.

AI assessment note: “There are two ways we found out about good accounts.”

Q All right, so you've got this store on Martha's Vineyard, and the strategy is to, presumably, to open more stores, right? And I guess you guys met a family called the Mitchell family. They had their own boutiques, and you formed a partnership with them. Tell me about who they were and, and, and why you formed a partnership with them.

A So there's a local store here in our town in Connecticut called Richard's, which sold Still in business, sells fantastic brands, men's and women's clothing store, and we had done a nice business with them. They sold a ton of our ties, and they were selling our other products as well, and I remember calling them one day saying, look, we think that we should have our own store here in Connecticut, and they said, um, ok, and we said, you know, we realize we do quite a bit of business with you. We don't want to take the business from you. That, that was always an issue, you know, in all these places, Is where we open stores and said, look, what do you think we should do? And they said, you know, we agree. You guys have a great brand and you've got a lot of opportunity and we think you should open stores and we appreciate you reaching out to us. We know quite a bit about how to run stores and how to run them very well. Well, what do you say we work together and we open the store together and if it works out, we'll open some more stores together. And so they were, um, Very helpful. Um, they helped us identify real estate. They also knew that we had a vision as to what we wanted the store experience to be like, what we wanted the product assortment to be like, and it was very different from their aesthetic and their store, which is more of a luxury, like high-end luxury, uh, specialty…

AI assessment note: “there's a local store here in our town in Connecticut called Richard's”

Q You know, I, I know that in 20, 22, the two of you stepped back and brought on a CEO and you guys became sort of stepped into more creative roles, which makes sense. You've been working on this thing for 25 years, um, but that didn't last long. You, you did return as co-CEOs. What did you learn from that?

A You know, it's, in any organization, it's very hard to have somebody come from the outside to lead and be successful. The success rate is not, you know, high. But I think there was a disconnect. We're not a fashion brand. We're, we're a brand brand. And so there's a big difference between fashion culture and brand culture. The other thing that I think was a disconnect was how important customers are. And how lucky we are to have customers that it's a total privilege. You know, there's lots of choices and the minute, and I, and I think we did this, I think we, we lost sight of just how important customers were. We spent a lot of time with tons and tons of internal meetings and planning and stuff for each other. And a lot of theater that really didn't end up being customer facing. And I think the customer, you know, let us know.

AI assessment note: “I think we lost sight of just how important customers were.”

Q Yeah. But you guys had this goal to hit five million dollars in sales before you would even think about expanding. Were you already, do you remember already in 2001 thinking, okay, we got to move beyond ties, or did you think of it as a tie business?

A You know, I, I think we were listening to our customers, and one thing that we're hearing a lot of was what, and a lot of our customers were women who were buying gifts for their husbands, and they really wanted something for themselves. They had fallen in love with our aesthetic, and our look, and our prints specifically, and they really wanted something, and so we came up with the idea of doing a tote bag in Lining the edge of the bag with our print. And that was another great product. Like you said earlier, accessories are great because there's not much sizing and that type of thing. And somebody suggested to us, um, somebody who was making some of the silk or something for us said, you know, really think that you guys would do well with your prints on men's boxers. And we said, Nope, we don't want to do that. That's really not something that interests us. He said, okay, that's fine. And then he showed back up at our place like a month later, and he had just taken it upon himself to make some samples for us, and he put them in front of us of boxers, and we're like, oh, those look great. I bet we could sell a ton of those, you know, so next thing you knew, we were, we were making men's boxers in our prints.

AI assessment note: “we came up with the idea of doing a tote bag”

Q So I'm curious, I mean, 1998 on that trip, where do you remember, aside from that boutique, I mean, you must have had some success of some people saying, yeah, we'll carry these, like, or was it just, I don't know, did you, was it discouraging?

A You know, I think it was, um, it, it was both. You know, it, it was a total luck of the draw, what we were gonna find, um, but, you know, it's hard to, like, I think we look back on it, uh, like, as the most fun we never wanna have again type of thing, where, you know, the reality is, you know, you're standing in a parking lot on the side of the road, putting on your tie, putting on, you know, we, we were like salesmen, you know, going into a place in the pouring rain, You know, in the fall each day it got colder and wetter and rainier, and each day there were more no's, and like, I think we look back on it and say, you know, the no's motivated us, and they did for sure, but they were hard, you know, because it was a very uncertain time. We, I think we always knew we could get another job if we needed to, but we didn't want to, you know, and so what we found was we, we didn't know the business, and we needed to learn the business, and so Those people who would say no, or who were like maybes on it, we just started to hang around their stores a lot.

AI assessment note: “You know, I think it was, um, it, it was both.”