Good-bye Color, Good-bye Profits

These are troubled times for the Tom Klaim fashion label.

Sales have crashed from $90 million in 1998 to a mere $6 million this year.

But owner and one-time designer Anatoly Klimin feels vindicated. After relinquishing creative control of his clothing lines to professional designers, he may have lost sales, but he no longer has to face criticism about his "clothes for secretaries," as the press derogatorily called Tom Klaim?€™s clothing.

"We were always naturally inclined toward bright colors," Klimin said in an interview. "When we brought out our black-gray collection, as I call it, our sales plunged overnight. As it turns out, we had had a niche."

"I made the decision so people would criticize me less. My feelings were hurt," he said.

Klimin said the decision to bring in designers with more conventional European tastes was also business related. He had his finger in other ventures that were gathering speed. Among them was the Klimin television production company, which produces fashion programs for Russian television and an Internet project.

"My social status makes it impossible for me to do everything myself these days." "Delegations, journalists, they all come to see me. I can?€™t be running round with pair of scissors in my hands," he said.

Klimin operated as an underground designer in Soviet days.

He began selling Canadian clothes in his hometown of Ufa, Bashkortostan, in 1992 and soon moved to Toronto, where he placed manufacturing orders for his own line of clothes.

Klimin opened his first store at the All-Russia Exhibition Center, formerly VDNKh, in 1994. His experience working underground and abroad gave him a strong commercial approach to design that set him apart from the majority of Russian clothing manufacturers. And the customers came in droves.



Tom Klaim homed in on consumers with vast advertising campaigns. Klimin says more than $50 million, which includes the costs of Klimin television, was pumped into promoting the Tom Klaim lines.

All the while, the company was launching new brands such as Klima, T.K. and First.

But the company?€™s total sales for 2000 will amount to $14 million, less than half of the $30 million that Klima alone brought in two years ago.

Klimin is confident that the money would roll in if the company were to return to its former fashion sense.

"Demand is vast. Stores place their orders from catalogues that are three to five years old," he said.

Galina Maslova, commercial director with Tom Klaim?€™s Lastana company in the east Ukrainian town of Dnepropetrovsk, said customers are pining for the clothes made while Klimin was designing.

"Women here like to dress up in all their glory," Maslova said. "Their clothes are typically brighter, louder, almost gypsy-like."

"Customers come to us and say, ?€?Give me something with a bit of oomph,?€™" she said. "These are the clients that we are losing."

Most orders are made from the older catalogs, and pre-1998 crisis lines of pink and light-blue Lurex suits are selling the best, she said.

Klimin said he has made enough money to weather the fall in sales and is now setting his sights on a new project: a quality awards program for fledgling businessmen.

Klimin is organizing the project with Vladimir Dovgan, who himself rose to prominence by plastering his likeness on products whose quality met his approval.

Under the program, entrepreneurs can bring their new goods to Klimin and Dovgan for quality testing. Then, for a fee, the two men will decide whether to give the products a thumbs-up.