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In addition to the collection sold at J.C. Penney, Donnkenny worked up a better-priced department store line called Nicole Miller New York but became too squeezed financially to get it off the ground. Ramping up these lines contributed to the company’s liquidity crisis and, ultimately, to its bankruptcy.
Squeezed by sinking apparel prices, competition from larger manufacturers and increasing pressures from a rapidly consolidating retail sector, midsize vendors such as Donnkenny have in many cases struggled to stay in business and have sought to partner up to survive.
“With the consolidation going on at the retail level, it’s harder and harder for the smaller company to survive and make the profits that are needed to keep them in business,” said Gilbert Harrison, chairman and ceo of Financo. “The economies that come from the sourcing expertise are essential.”
The sourcing muscle of Pacific Alliance was one of the things that attracted Nicole Miller chairman and ceo Bud Konheim to the company.
Konheim could have pulled the Nicole Miller license back from Donnkenny when it went bankrupt but was supportive of Dabah taking over the firm, and independently has a jeans and a children’s wear license with Pacific Alliance.
“He has a vision that absolutely mirrors our strategy,” said Konheim of Dabah.
That strategy entails using the brand’s higher-end designer offerings, which are worn by starlets and paraded down the runway during New York Fashion Week, as a halo that gives cachet to the more accessibly priced subbrands.
Now the challenge will be to differentiate all of the Nicole Miller offerings, said Konheim. The trick will be keeping the higher-end and lower-end businesses similar enough to bear a resemblance — but different enough to not muddy the brand.