Quiksilver, Volcom CEOs not worried by economy
LAS VEGAS, Aug 28 (Reuters) - Top action sports brands selling casual apparel to surfers, skaters, and fans of the "beach look" have been little affected by a slowdown in consumer spending, the chief executives of Quiksilver Inc (ZQK.N) and smaller rival Volcom Inc (VLCM.O) said this week.
Asked about the current back-to-school season, a key selling period for companies that cater to teens, Volcom Chief Executive Richard Woolcott said on Tuesday that early reports were favorable.
"So far, so good but we're right in the middle of it," Woolcott said at a presentation during the Magic Marketplace apparel trade show, where sellers book buyers' orders for Spring 2008. "I'm also interested to see how long it trends into September."
Robert McKnight, the chief executive of Quiksilver, the largest action sports apparel maker in the United States, told Reuters on Monday that fears of slowed consumer spending, together with difficulties in the credit and housing markets had not hit his business.
The company's core customers are small surf shops that line beach-front communities across the world, but Quiksilver gear can be found in large retailers and department stores as well.
"It's like a spook fear out there," McKnight said, referring to current trepidation in the market. "Something every year is in the mind of the consumer."
But he was quick to add that the kids that buy Quiksilver apparel, shoes and accessories are insulated by such pressures since the company caters to a "more affluent beach customer."
"So I think we're fine. We're insulated from that," McKnight said. "People we sell to are not scared."
Sales at Quiksilver stores were up, summer sales had been strong, he said. Also helping Quiksilver were its affordable prices and focus on basic clothing, rather than trendy styles that might go out of favor with consumers during belt-tightening times.
Volcom's Woolcott acknowledged that many apparel retailers were feeling cautious going into the second half of the year, but said the company had to focus on its fundamentals in such times.
"It's no secret there's pressure out there," Woolcott told Reuters, adding that Volcom looks at its own business to gauge how best to ride any macro-economic fluctuations that it cannot control.
But customers rely on brands they know and trust during times of spending cutbacks, Woolcott said, adding that that will help Volcom, an extremely popular brand with teens whose motto is "Youth against Establishment."
"The retailer is more cautious for sure," he said. "We've just got to be prepared."
