Balancing Act

On the eve of its silver anniversary, Coccoli Commercial Director Francois Vachon reveals how the brand’s approach to business—merging the tried-and-true with a modern spin—has paved the road to success for another 20 years.

When the direct-to-consumer movement swept across children’s fashion about five years ago and it seemed like every brand in the industry launched an e-commerce arm, Francois Vachon faced a tough choice: As the Commercial Director of the longstanding children’s label Coccoli, he knew he may alienate at least a few of his current retail clients if he began selling the brand’s merchandise on its own website. On the other hand, he feared he would lose a lot of potential sales to competitors if the company didn’t offer a way for its customers to order online.

So, true to the style that’s defined his smart approach to business for the past 15 years, he struck a compromise: Vachon launched an e-commerce site for Coccoli, but the brand only offered its merchandise online after it arrived at its brick-and-mortar destinations, and products wouldn’t be discounted until the very end of the selling season. That way, retailers would have every opportunity to show Coccoli to their customers first and would be able to sell the brand at full price, without competition from Coccoli.com.

As a 15-year veteran of the children’s industry who grew up wandering the aisles at ENK Children’s Club, it makes sense that Vachon is particularly cognizant of maintaining a strong bond with the brand’s traditional buyers. His mother, Marian Vachon, first launched Coccoli in 1995, but her roots in children’s fashion go back even further, to 1986, when she launched Coccoli’s parent company Creations Robo. Based in Montreal, the company continues to specialize in importing European brands to the North American market. Today, in addition to manufacturing Coccoli, Creations Robo distributes five brands: Me Too, a Danish fashion staple; Claesen’s, a Dutch underwear label; Celavi, an outerwear label from Denmark; Minymo, a contemporary sportswear collection also from Denmark; and Iglo + Indi, which Vachon describes, fittingly, as “a very cool Icelandic brand.” The company also recently launched Beanstork, an organic layette label.

While Vachon certainly learned a great deal under the tutelage of his fashion-savvy mom, it’s his own interest in mastering every aspect of the business that has played a crucial role in Coccoli’s success. “I’m not necessarily a pro at any one thing, but I’m a good generalist; I’m good at making the whole thing come together,” Vachon acknowledges. “At the end of the day, I’ll go from the design department to shipping to production, and make sure everything is going according to the ultimate goal—that we’re all working on the priorities of the day.”

After all, manufacturing a fashionable garment is just one aspect of long-term success, Vachon offers. Take, for example, Me Too. Even though the Danish staple has long been beloved for its bright, kid-friendly designs, the brand’s original owners sadly went bankrupt a year ago. “Me Too had delivery problems, and the next thing you know, it’s shipping late, so clients left and the designs suffered,” Vachon admits. Thankfully, Me Too was quickly snapped up by Brands4Kids, a Danish children’s fashion company owned by Erik Andreae and Michael Nederby.

“They’re very dynamic and very sharp,” Vachon says of the pair. “The first day I met them, we didn’t talk about apparel once. All we talked about was business structure and logistics. I love apparel; it’s fun, it’s fresh, it’s new, it’s exciting. But the base of our business has to be on-time shipments, and tops that match bottoms. Coordination is crucial. For them to not even bring up aesthetics at all on the first day was so refreshing. You can have the most beautiful garment in the world, but if it’s not in the store at the right time, it means nothing.”

That commitment to keeping retailers happy has been a key component to Coccoli’s longevity. Today, the brand is available at 300 specialty retailers in the U.S., and 150 in Canada, as well as stores in Australia and New Zealand. And next fall, as Coccoli turns 20, it’s easy to imagine the company continuing to thrive under Vachon’s balanced leadership. Yet even with the focus on the finer points of running a successful children’s company, fashion isn’t always strictly business, Vachon admits. Again, he adds, it’s a mix. “It’s wonderful to have a product that’s a nice mix of concrete and creative—it’s not strictly creative because you have to work within physical guidelines. You have parameters, yet you can always draw a little bit outside the lines because it’s a creative product,” he continues. “It’s a lot of fun in that sense. You get the best of both worlds, both business as well as creative.”

For 20 years Coccoli has been known for layette and sleepwear, but the brand recently expanded into daywear. How has the new collection been received? 

We’ve been focused mostly in the 0 to 24 months playwear/sleepwear category, but in Fall ’14, we brought in some dresses, tunics and leggings for girls with a lot of the same fabrics we use in our layette collection. Now, I would say the collection is 1/3 daywear and 2/3 layette/sleepwear. It’s working out well. We didn’t hire a new designer strictly to work on the daywear. We’re still a bit of a “PJs company” doing daywear, so there’s a bit of a learning curve, but we’re getting there. It looks pretty good. In Fall ’15, we introduced a pant for boys in French fleece, so it’s got a lot of stretch. It’s kind of our answer to leggings for girls. It’s a straight cut, so it looks like a clean pant, but it’s got the comfort of a sweatpant. For boys, it’s a little unfair, they are either wearing sweatpants, which don’t look good, or pants or jeans that are so stiff, they can barely get back up after they sit down. We wanted to find something in the middle. The pant is great—it retails for $25 in baby and $30 in sizes 2 to 10. It’s easy-wear, easy-care and good cost. It looks good without having to sacrifice comfort.

What inspired the expansion?

Knit quality has really increased in the last five or 10 years. Today, you’re starting to see a very acceptable level of quality for pajamas and layette even in big box stores. In order to remain pertinent, you have to stay two steps ahead of the people behind you. So you create more of a brand, with more items in the collection, and daywear was a natural progression for us.

Besides adding daywear to the collection, how else do you stay two steps ahead of that competition?

It’s a mix of keeping up with where you think the market is going, as well as reacting to where sales are going and to what buyers tell you. We do sell on our own consumer website now, and we also sell to the upscale flash discount websites. On the other hand, we’re very conservative. For example, we started selling Fall ’14 Coccoli on the discount sites as of July 2015. I only put it on those sites a full year later.

To avoid conflict with your retailers?

Exactly. I know some brands put their products on those sites 90 to 120 days after shipping to their brick-and-mortar retailers, but I wait a full year. I’m very careful in that sense. Also, on our e-commerce website Coccoli.com, we do our best to give our brick-and-mortar retailers every chance in the world to sell Coccoli without Coccoli corporate coming in and stealing that business. For example, whenever we get a new style in, we ship it to our clients, and we put it on our website a full two weeks after that. When you think about it, as soon as the merchandise is in my warehouse, I could put it on my website right away. But by the time you pack it and get it to the stores, I’d be putting it on my site a full two weeks before my retailers have a chance to show it to their own clients. But they committed to it six months ago, and I produced the collection based on their ordering, so it would be really unfair.

That’s fantastic. I think today’s savviest brands are the best at balancing their direct-to-consumer sales with the needs of brick-and-mortar retailers.

Another thing we do is wait until the end of the season to start discounting our merchandise on Coccoli.com. Some brands, for example, began discounting their Spring ’15 collections in April and May on their own websites. We start discounting our merchandise on Coccoli.com the day we start shipping the next season—so Spring ’15 Coccoli went on discount as of late June, when we started shipping Fall ’15. As a business, I don’t want to win on the left only to lose on the right. I don’t want to win on my retail business only to lose on my wholesale business.

Has the advent of e-commerce changed how you approach business in other ways, too?

The real revelation is, for the first time ever, we started to see how consumers buy Coccoli, as opposed to how retailers buy from us. When we’re at a trade show, and the stores come to see us, we often hear, “Coccoli is footies. I buy my footies from Coccoli.” If you start creating dresses—even if your dresses are nice—that buyer has a structure in her store: She buys brand X for dresses and brand Y for PJs. If you start producing new products, yes, you’ll have some clients try it out, but a lot of clients, because they already have a structure in place—which I completely respect—will pigeonhole you. They will typecast you. I never thought of that until I started seeing sales come in from online vendors and now our direct-to-consumer site as well. You can finally try to step a bit outside of what clients have decided your expertise is, and that’s really nice.

What are some of the differences in how consumers buy Coccoli?

One thing, for example, is prints. We’ve always been known for our stripes, but we’ve always been afraid to make prints in the fear that it wouldn’t embody the Coccoli look. However, there was one print we made three years ago, of horses running, that sold very little in booking. But I loved it so much, I said to heck with it, I’m going to put it on Amazon. Let’s give it a shot. And it sold really well. For me, it was a revelation—that we can decide where we want to go, rather than trying to please the clients we already have. It requires taking a bit of a leap of faith, because you have to make stock, but sometimes you’ve just got to take a chance.

Has your strategy for growth changed as a result?

Up until the web became a core part of our business several years ago, we were very, very traditional. We designed two collections a year, attended trade shows and sold to independent shops. But now there are so many ways of moving inventory. Of course, you have to do it in a way that’s respectful of your current business. For example, we’ve also started doing warehouse sales, which I never used to do. We’re located right in the garment district of Montreal, and I’ve been holding back on warehouse sales because of our local clients, who were wonderful accounts. But in this past year three Montreal stores that bought every single one of my brands have closed. That was a big hit, emotionally. So we’ve been doing warehouse sales for about a year now. Another thing we’ve done is open up new markets. As of Fall ’14, we sell in Australia, which has become a very important market for us. What’s fun about selling to Australia is they’re showing the season we’re shipping here in the states. Our distributor has been showing Fall ’15 since July, which we’re going to ship to her by boat in November, and in the meantime, she’s been working off our inventory. That’s another incentive to make overstock—to be able to service this great market.

It’s great for business, but it’s certainly a lot more to manage.

The online sales software Brandboom has been a welcome addition; it’s been very efficient for us. Sales agents and distributors can sell stock based on our inventory, so no more back and forth with the buyer to inform her, “Top X in size 6 isn’t available. Would you like another as a subsitute to match the pant?” It’s also easy for buyers to log in, view high-resolution pictures and see actual inventory on their own time. It was fun in the past to wake up to reorders in your inbox, or at the fax machine. But it’s even more fun to see reorders come in based on actual inventory, which you can ship 100 percent as ordered. No more back and forth with the buyers, which was frustrating for all involved.

How do you plan to grow Coccoli going forward?

You always tweak your brand; you always find space to improve. Five or six years ago, a lot of our footies were elaborately embellished and sold for $20 wholesale. That was around the crash of 2008, and at that time I felt people were looking more at the price [of a garment] so we decided to simplify the fit of our footies in order to sell $15 wholesale, about $30 retail. There was a wave of stores closing, but I think it’s clear that the stores that were going to close have closed. And we’re now seeing new stores reopen with a new approach. It’s much more lifestyle rather than just fashion, and I’m seeing clients ready to spend more per unit now. We intend to fill that demand with our growing collection, which is more complete with mix-and-match items, and launching new packaging for 2016. Independent retailers want something special, and they’re not afraid to pay for it. Next season, for one of our five deliveries, I plan on creating a collection that will be more elaborate and refined. The footies will retail from $40 to $45, but will have embellishments and possibly special packaging. Four of the five deliveries will remain the same, so I won’t be turning away my regular business, but in order to create new business with that same client and maybe go and get other clients who may not normally buy us, we will have something new to offer.

Sounds like a smart way to bring in new business while keeping your current clients happy.

That’s the goal. We also launched a new brand at Robo called Beanstork. It’s designed and manufactured by us in India. It’s a classic, very sweet, very crisp layette line, made using organic cotton. Where Coccoli is rib and jersey knit, this one is interlock knit. This is a full-year stock program. For Coccoli, I’ve got showrooms in New York and Los Angeles, but I put this one in a different showroom, and it’s fun to see new accounts that my other showrooms didn’t necessarily have, probably because it’s organic business. On the other hand, I see that some of our current stores, especially gift shops, love replenishment of their tried-and-true. So rather than creating a new pastel collection for Coccoli every season, I’m going to do one that lasts a full year.

What would you say is the biggest difference in the children’s market now versus 20 years ago?

The biggest difference is how quality has increased three-fold for what I would call lower-end sellers. You used to be able to tell if a product was quality or not from across the room. Also, consumer tendencies have changed. A mom who has a nice car and sends her kids to the best private school may not spend a lot on clothes. In the past, I feel like someone who was fancy was fancy from A to Z, and somebody who wasn’t, wasn’t. I love being at our warehouse sales because you get to really hear what people say. One day I was listening to a couple of ladies talking and one said, “I always spend the least amount I possibly can for pajamas. I’m the only one who sees the kid in the PJs, so who cares?” In a similar vein, you have people who say, “They grow out of it so fast, so why spend?” And this is often the same person who will drop $150 on a dinner for two on a random Tuesday evening. If you want something that doesn’t last long, a meal doesn’t last long. It’s not related to salary. Today, it all depends on a family’s values and priorities.

Would you say that’s the biggest challenge in today’s market—to find that consumer who prioritizes children’s clothing?

The biggest challenge? To demonstrate the benefits of buying your garment versus somebody else’s. You can say it’s your quality, but people might not even recognize quality. They may say, “Frankly, I don’t see a difference.” You can say, “The quality of their garment won’t last through 30 washes, whereas I guarantee you it will with mine.” But once you say that, you’ve got to demonstrate it—and get that message out to shoppers. And the Internet has been fantastic for the opportunity to get your message across. It’s so easy. You can take a video with a semi-quality camera with a quick montage of what a garment looks like from wash one to 30, and put it on your website. In the past, you would have to hire a marketing firm to do these types of things, but today you can do it yourself and it will look just fine. The problem, of course, is getting people’s attention, because people are bombarded left and right. But at least today, we have the opportunity to easily get that information to them.

Given the challenges you mentioned, what advice would you offer today’s independent retailers?

You have to give consumers what they want; you have to go and get the core brands for your market. But you also have to bring in some original collections every season, even if they don’t always work out. Your consumers have to feel they might be surprised every time they go to your store. And as much as you want to please your customer, you have to infuse your store with your own personality because in the end, you are the business. People are buying you. Otherwise, if customers are only purchasing the one thing they came in to buy that day, they will end up buying on the web. People will buy you for the experience—to be surprised and entertained. It’s all about the right mix of giving shoppers what they want, the tried-and-true, and surprising them. •