When Gramicci's fall 2010 collection hits the shelves at outdoor retailers like REI, Hudson Trail Outfitters and Kittery Trading Post, shoppers will notice a difference that has nothing to do with Gramicci's iconic designs. "Prices will be between 8% and 20% less than a year ago," explains President Marty Weening. "Our famous climbing 'G-pant,' for example, used to sell for between $52 and $56. Now it will be $48."

The price cut was made possible by the new license agreement, announced in December 2009 between Gramicci and Haggar Clothing Co. It is precisely the type of benefit both companies envisioned. "These savings are the direct results of Haggar’s outstanding sourcing capabilities," Weening says. "By taking advantage of those capabilities, Gramicci has been able to boost our retailers' margins with us by between 3% and 5%, on average. Early reactions to this have been very positive."

The partnership between Haggar and Gramicci is an ideal match, adds Buxbaum Group Chairman and CEO Paul Buxbaum, who also serves as Haggar's CEO. "Haggar offers Gramicci more robust service capabilities to their existing customer base, while connecting them with a new shopping community," he says.

The timing, moreover, is ideal given that much of the retail world has undergone a dramatic price-correction since the onset of the economic crunch in 2008. "We are very excited now to be able to pass these savings on to our retailers and their customers," Weening says. "This is great timing."

The recession has had an interesting effect on the outdoor segment, Weening adds. Rather than, say, flying to Europe or the Bahamas for extended vacations, many Americans now are saving money by turning to cheaper recreational opportunities in their own backyards. "There has been about 25% to 28% growth in people participating in outdoor activities since 2008," he notes.

This is part of the reason the outdoor segment's total annual sales have hovered at about $5 billion over the past three years. "That is somewhat flat," Weening says. "But given the declines that have occurred in retail since 2008, one could easily interpret holding the line as a positive development."

Thanks to all those newly minted outdoorsmen, sales of tents, footwear, outdoor accessories, sleeping bags, backpacks and climbing gear actually rose in 2009. Sales of sportswear and outdoor apparel, however, declined about 7%. "When the economy gets tougher, the outdoor business tends to fall back on what it knows best—hard goods," Weening says. "Gramicci’s business has been stable to slightly ahead. We worked very hard to get there, but in the context of today’s economy, this is good news."

Even as it reaps immediate benefits from Haggar's sourcing capabilities, Gramicci also stands to gain from its partner's considerable financial and back-office administrative expertise. "Our relationship with Haggar will not only help grow the business, it will help bring much-needed price and value relief to our retailers which, in turn, will get them through these challenging times with a product that has tremendous value," says Weening. "There is no question this recession has taught us how to run a better business that will survive today and thrive tomorrow."

Balanced Strengths continued

that also operates 47 retail stores. His ownership stake in Gramicci, the progressive outdoor retailer known for its iconic designs, is yet another reflection of the company's firsthand experience in manufacturing—not to mention Buxbaum's past work with such prominent brands as Rampage and Seven for All Mankind. "Buxbaum Group itself has been doing retail and wholesale liquidations for more than 30 years, and inventory appraisals for nearly 20 years," Siebersma adds. "Our appraisal knowledge grew out of the retail business, and we pride ourselves on staying acutely aware of retail liquidation values. We stay on top of the bidding process; we know where the stalking horse bids are landing, and we closely track auction results from across the country."

This balanced approach has been much in demand over the past year as Siebersma's team worked closely with asset-based lenders on a host of retail and wholesale inventory reappraisals. "This started with the economic shock in 2008 and continued in a consistent way throughout 2009," he notes. "Naturally, our clients want us to look carefully at the collateral they are lending against."

Moving forward, there is ample reason to be optimistic about appraisal activity in 2010, Siebersma adds. "All of the key factors indicate asset-based lending should bounce back," he says. "The economy appears to be stabilizing to some degree, and there are a lot of viable businesses out there that desperately need funding."

The government continues to push lenders of all types to make more loans. And now that so many lackluster retailers and weak banks have been flushed out of the system, prospects of loan activity actually accelerating are better. Today's glut of cheap and well-located real estate also favors measured retail growth—and not just for discounters and dollar stores. "Progressive, successfully run and value-driven retailers will expand with new stores," Siebersma predicts.

Chains also will strive to bring their barebones inventories back into balance. For wholesalers, manufacturers and lenders alike, all of this could spell good news. And that could mean a busy 2010 for Siebersma and his team.