Suitsupply: Coming to America

Dutch-based Suitsupply is about to take the U.S. market by storm.

This is a longer version of the story that appeared in MR’s June issue.

In a recent Wall Street Journal article, two suit experts were asked to review the quality and make of six suits from opening price to designer in an unscientific, blind test. Suitsupply, a Dutch brand making their foray into the U.S. market tied with Armani for first place in quality, but not in price: The Armani model retails for $3,625 and the one from Suitsupply for $614. The article brought a lot of attention to this relatively unknown brand that’s primed to make some major waves in the U.S. market, especially with a Manhattan store just opened in this month.

Like many college students, Fokke de Jong needed to make some extra money when studying in Holland. He started selling clothes to fraternity members, because as he says, “everyone had to have coats with their frat letters on them.” He took that one step further and started hosting trunk shows where he sold suits to fellow students and employees who worked in the offices on campus. Six months shy of graduating with a law degree, de Jong’s business started to take off and he decided to focus all of his attention on it. “The main thing I noticed was the multiple steps in distribution of high-end suits, so I decided to launch a company that took out the middleman. The biggest revelation I’ve had was that in the last 10 years fast distribution from stores like H&M and Zara have swept the market, but it hadn’t hit the luxury sector. You have two sides of the spectrum: very expensive high-end suits or very low end, but to get a well-made suit, with a good customer service experience, especially here in NYC, for around $500 is almost impossible. We’re here to fill that niche.”

The idea behind Suitsupply is simple: suits are modern in fit and styling, but traditional in make and manufacturing (full- and half-canvas production, Italian fabrics, hand tailoring, working buttons, real horn buttons) at half the price of a designer suit. They have a large selection in size ranges (short, regular and long) in 20 to 25 styles of suits with three main collections and a bespoke offering. The Blue collection is the most basic made of super 110s and 120s fabric and opens at $380; The Purple collection has half-canvas construction and has a bit extra quality in fabric and make more details and handwork retailing for $450; the Red collection is the top tier and has a lot of handwork, handmade shoulder detail and retails for $615; Bespoke suiting retails from $600 to over $1,200. However, de Jong says that their goal is not to push guys into the bespoke line, but have as an option for men who are hard to fit or who are really into customization and want to play around with the buttons or the linings and create their own. Bespoke suits take about 4 to 5 weeks. Because the collections are largely fashion-focused most of their offering is nested, but they do have four separates styles. In addition to suits they sell dress shirts (made of Italian fabric) for $95; ties for $44; shoes for $278, bags $300 to $400 and grooming products $50 to $60. Shoes and bags are also performing exceptionally well and de Jong mentions grooming as an interesting category with huge growth potential.

On how they keep prices down: We’re a vertically integrated company, so we design, manufacture, buy and operate everything in house. We source all raw materials in Europe and only use Italian fabric. Manufacturing is mainly done in the Far East, mainly in China, but with rising costs we’re producing about two-thirds of the next two seasons’ collections in Portugal, Turkey and Italy. We don’t see an end to price increases, so we have to be strategic about where we manufacture goods, so we’re looking for new sources in Mexico or the U.S. too.

On their store location strategy: The big concept is that we choose destination locations so we avoid paying really high rents. We don’t need to be in major shopping centers because much of the traffic is not our target customer. We do this because it saves a lot of money and because our customer is more of a destination shopper—they orient themselves online and then they go to the store, but it’s not like they are wandering through the streets thinking, “I am going to buy a suit now.” They’ve made up their mind before they even come in. This strategy has proved successful in current markets and we’re confident we’ll be successful in the U.S.

On opening a store in New York City: There is a population of people who are interested in better dressing. There’s a growing demand and interest certainly with the younger customer. We have an e-commerce business, which generates about 15 percent of sales, and is one the reasons for opening a store in NY. We noticed orders coming from the U.S. We have a very high repeat customer. Men find something they like and they want to buy it in every color and fabric and this especially shows true with online sales. We found that men in the U.S. will buy two sizes and send back what doesn’t fit and then order more of the size that does. We don’t offer alterations online yet, but are looking into it especially with new technology coming out we hope it is something we can do soon. In the current retail environment you have to specialize to be relevant. One thing which is important to us is giving people a perfect fit and that’s why we have tailors in all of our stores who do alterations on the spot, while you wait if you’d like. In-store alterations are promised to be done within 30 minutes otherwise the alteration fee is waived (usually around $18 to $20).

On promotional strategy: We don’t go on sale, mark down or do any type of promotions. We’ll probably have an outlet structure because we have one in Europe, but it is truly an outlet (not creating new product for outlets). It will be a place to get rid of slow-selling styles.

On reaching the New York customer: We have a simple strategy. We will start with a core 40 to 50 customers and make sure they are happy and then they will spread the word from there. Our business is very much word-of-mouth driven.

On generating buzz: We ran a campaign for fall 2010 called “Shameless” and that created a lot of buzz. It was considered so risqué that we were even kicked off of Facebook because of the images. I was actually really surprised by how much of a reaction we got it from it. Obviously you launch a campaign to get a lot of attention, but we didn’t expect it to be such a big deal. The funny thing about that campaign really was that there wasn’t anything to see, but there was so much sexual tension in the pictures that everyone went wild and we got blamed for their imaginations! We once ran a campaign that because we only sell menswear, we called it “Not Dressing Women” and we showed naked women in the ads, and even that didn’t get the same reaction as Shameless! Our brand proposition is different than the rest of the suit business. Traditional suit brands and retailers cater to the establishment, the old men’s club and then that’s what they become, an old men’s club. We do more than that—we create excitement.

On possibilities of wholesale: We’re open to wholesale, but so much of what we do is more than just making suits. We offer our customers the whole package with an in-store tailor and knowledgeable and experienced sales people. So I could imagine one day wholesaling, but it might be more of a shop-in-shop type of model in specialized, independent retailers. Right now it’s more important to build stores to get the expertise in this market first.

On the difference between the U.S. and European markets: There’s probably going to be a lot of difference between the U.S. and Europe markets. We already see a difference in fits, in Europe it’s still much slimmer than the U.S.

On staffing the U.S. store: That’s the biggest challenge at the moment. We’re trying to find 40 or 50 people in the U.S. to work for us. We’re looking for buyers, e-commerce and retail management. We need people to build our online business and I have the feeling that it will be stronger in the U.S. because people here are more online-oriented and much more forward.

On spring 2012: We’re seeing more enzyme washed fabrics. Lighter fabrics with higher twist yarns and wool/silk blends with a little shine. We’re expanding our product offering in categories like sportcoats, jackets, trousers and knits (wool/cashmere and cashmere).

Fast Facts

Founder & CEO: Fokke de Jong
Headquarters: Amsterdam
Established in 2000.
35 stores in 6 countries with a strong e-commerce component (about 15 percent of sales come from online).
Company-owned stores are located in Belgium, Netherlands and the U.K.
New company-owned stores are opening in New York City, Milan, Germany and Shanghai.
Franchised stores are located in Russia and the Baltics.
Employees: 450 and expanding with new market expansion
NYC store: 4,000 square feet located on Mercer street in SoHo