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Klayman Pants—Surviving and Thriving in a Changing Market

By Robert Nordstrom

“We’re chameleon-like,” says Steve Epstein, co-owner with partner Mike Klayman of St. Louis-based jobbing company Klayman Pants. “Klayman Pants has been around for 82 years, which speaks for itself in terms of our ability to adapt and survive.”

From jobbing to manufacturing and back to jobbing, Klayman Pants indeed has adapted to changes in the apparel market over time. While today the jobbing company carries men’s shirts, pants, and outerwear; some boys’ school uniforms; and specializes in men’s work clothing, for the past eight decades Klayman Pants has adapted its products and mode of operation to the needs and vagaries of the market.

From Jobbing to Manufacturing

Founded in 1924 by Mike Klayman’s grandfather, Sol Klayman, for many years the company dealt primarily with men’s dress apparel from the jobbing side. In the late 1950s and early 60s, however, the company gradually morphed into manufacturing, focusing primarily on dress pants and eventually moving into children’s wear in the late 60s.

Steve joined the company in 1969 after a brief teenage fling in San Francisco’s famed Haigt-Ashbury. From the psychedelic capital of the USA to the rough and tumble daily grind of the apparel business world, Steve’s adaptability credentials speak for themselves. Mike joined the family business in 1970, which by then was owned by his father Robert, his Uncle Norman, and his grandfather, after graduating from college with a journalism degree.  

Business was booming. “We were 95% manufacturing at that time,” Steve says. “We were making fashion pants and jeans for over a hundred chains with anywhere from 10 to 300 stores.”

Over the next 20 years, however, their retail customer base steadily shrank as the mega discounters began gobbling up the regional chains. To take up the slack the company found a niche in the prison uniform business, becoming a major manufacturer of denim for inmates.

But that business changed as well. The institutions changed their product mix, opening prison industries where inmates began manufacturing their own apparel.

Going Back to the Company’s Roots

On the bright side, however, the off-price business was taking off in the early 1990s. Once again Klayman Pants adapted to the changing market by moving full circle back to apparel jobbing—the industry in which Sol Klayman grabbed his opportunity in 1924.

“We found that we did jobbing pretty well,” says Steve. “Many of the skills and techniques we learned in manufacturing carried over well into the jobbing business. For example, buying carefully and taking advantage of opportunities as they presented themselves. As manufacturers, when opportunities to purchase raw materials arose, we would buy, even if it was significantly more than what we needed. We’d just set the goods aside. We developed techniques for using irregular materials and turning them into first-quality garments that were pretty unique in the industry. We were extremely competitive, we kept our overhead down, and we did the work ourselves both in the warehouse and office. We use these same principles in our jobbing business today. If it’s November and we come across a great deal for shorts that we won’t be able to ship until March, we jump on it. That’s an opportunity.”

“We’ve also developed a reputation in the industry,” Mike adds. “We always pay our bills on time; we don’t complain about the product we get. We take it and handle it. We have a lot of vendors contacting us to move their goods because of that. We also like to purchase full lots. We’ll bite off the whole thing and put it away.”

Growing with the Off-Price Specialist Show

Their methods have worked. After scaling back the business when the manufacturing business dried up, the company has grown significantly over the past ten years. Since 1998 the company has doubled its business, growing at a rate of 15% - 20% per year, and today serves over 2000 accounts, ranging from small independent store owners to large multi-store chains.

Mike and Steve attribute much of the company’s growth over the past decade to participation in the Off-Price Specialist Show. The company has attended every show, including all the New York, Las Vegas, and even the single Los Angeles show, since the second show at the now defunct Debbie Reynolds Hotel.

“We’ve grown significantly since the advent of the Off-Price Specialist Show,” says Mike. “The show introduced us to retailers we never knew existed. We’ve always found new customers at the show.”

“We did the ASD Show for many years but the Off-Price Show ate into that and we discontinued ASD about three years ago,” Steve adds. “We don’t maintain a showroom and most of our sales are done from our home office over the telephone by Mike, me, and my wife Linda. The shows give us the opportunity to get out of the office and meet our customers as well as find and develop new ones. There’s also a certain amount of business that’s done between jobbers. We’ll get customers looking for something that we don’t carry and we’ll send them to another jobber. And of course some jobbers will do that for us as well.”

“The show has been a huge boon to our business,” Mike says. “I’m not sure where we would be today without it. I know that we wouldn’t have a lot of the great customers we have today.”

Feeding a Retail Operation

Klayman Pants is known in the industry for its men’s basic wear and work wear. One of the company’s better relationships in the industry is with Williamson-Dickie, from whom they buy a lot of work wear irregulars. In addition to helping them develop a profitable niche within the jobbing industry, this relationship has also helped them feed the company’s retail store, Workwear for Less, which they started up approximately five years ago.

“The retail store has been very successful for us,” says Mike, “and it fits nicely with our jobbing operations. We started out with 400 square feet at our old offices and warehouse in downtown St. Louis. We expanded to 1200 square feet, then 1800, and 2400. Today, we have 3600 square feet of retail space adjacent to our offices and warehouse, which we recently moved into. We feed the retail store primarily with our wholesale goods, other than for a few boots and t-shirts. Dickies has been a good item for the store and we’ve prospered with it.”

Having a retail operation also functions as a good source of information for the jobbing business. Mike says, “We find out what our customers like, the hot colors, what sizes people are buying. Our employees also give us a good reading on what’s hot. When we get something new in, we know right away if it’s an item that’s going to work well when our own employees buy it for themselves.”

Hands-On Owners

Both Mike and Steve take a hands-on approach in both the retail and jobbing operations—stacking and packing merchandise, picking orders for shipment, even working the cash registers in the retail store during special events—while also providing a living for 18 employees, some of whom have been with the company for 20 years and longer.   

“Recently,” Mike says, “a customer came into see me and I was out in the warehouse stacking pants. He said, ‘Mike, you haven’t changed in 35 years; you’re doing the same thing you were doing 35 years ago.’”

Changing with the Times

While Mike and Steve’s strong, hands-on work ethic may not have changed over the past 35 years, the partners’ have always kept a close eye on the industry and positioned the company to adapt quickly and profitably to industry changes.

“We’ve managed to survive a lot of changes in the industry,” says Steve. “We’ve seen many companies, both big and small, disappear. Our size allows us to adapt quickly and to take advantage of opportunities as they arise.”

With the advent of the China phenomenon and the increased flow of apparel into the country, Steve believes that large scale industry changes are sure to occur.

“With China in the picture,” he says, “we don’t know whether we’re looking at new opportunity or tough times. We just know that it’s going to change the face of jobbing. There’s a flood of goods coming into the country at prices we’ve never seen before.

“The old days, where you had a price on a particular category and felt pretty confident that you knew what the price would be for a relatively long period, are gone. For example, we bought some leather coats at a price so low we thought we were stealing them. The next season, those coats from China were 25% cheaper.

“We feel that China is creating tremendous opportunity while at the same time we’re feeling a bit nervous about the risks because of how quickly the market is changing. China may start selling more goods here directly through their own distribution channels. We just don’t know          . But we do know that we have to watch closely and that it’s going to change the nature of our business and what we do.”

The company is exploring new buying opportunities by working with overseas sourcing and buying agents. And Mike and Steve have also partnered with other jobbers to buy large lots because the deal may have more goods than the other jobber can handle or has categories the jobber does not carry.

Observing the market and adapting to change—that’s what Klayman Pants has always done best.