New York—Handbag greats Carlos Falchi, Monica Botkier and Rafe got together last week to discuss their beginnings in handbags and to share their tips with emerging handbag designers.
Moderated by Emily Blumenthal, founder of Handbag Designer 101 (now the HBD Network), the IHDA Designer Awards, and a former handbag designer herself, the panel shed light on an important yet increasingly competitive portion of the accessories industry.
Falchi, Botkier and Rafe have decades and decades of experience between them, and here they share their experiences and insights from the trenches.
HBD Network: Were you always fascinated by handbags as a child?
Monica Botkier: I started as an artist then a fashion photographer. I couldn’t sew but I could sketch.
Rafe: I grew up in the Philippines where you wore your “Sunday best” on Sundays. My sisters used to tease me I looked like ‘the gardener’s son’ because I didn’t dress up. So they started having clothing made for me but soon I thought I could improve the outfits and started designing. In New York I attended FIT and learned to sew, and while I never truly loved sewing, it’s really helpful to know from a design perspective.
Carlos Falchi: I made a macramé handbag at age five in Brazil, where I grew up. My mother was a wedding dress designer so she put us kids to work (to keep an eye on us!) helping stitch pearls on the dresses. Fashion is in my blood although I didn’t know I’d get into handbags. I started making my own clothes and selling what I wore to friends.
HBD Network: I tell aspiring designer that just because they sell one bag doesn’t mean they have a business. People think because they sell to their friends, buyers will want it too. But buyers won’t buy because they like you. But your friends will.
Rafe: Buyers are only buying it because they can sell it. You can love a bag all you want, but if it sits on the shelf in markdown, it’s not so cute anymore.
HBD Network: Every brand has its anchor piece. How do you advance your line while still keeping true to the look that made you a hit in the first place?
Botkier: There was the whole Kardashian incident [Botkier sued Sears for selling a Kardashian Kollection for Sears style eerily close to the famous Botkier Clyde handbag.] We keep a Classics Collection that we can bring back, but we always want to move forward.
Falchi: We have our signature totes and everyone says, ‘But aren’t you flattered when someone knocks you off?’ No! Why should I be flattered when others are making money off my design? Tip for new designers: have to find your own DNA and stick with it.
Rafe: Our signature piece has changed but the handmade, mother-of-pearl inlay minaudieres from the Philippines still spark an emotion.
HBD Network: How do you balance what buyers ask you to make and what you really want to design for that season?
Rafe: Buyers don’t always remember what they ask you to do anyway, so it’s best to just trust your instincts!
Botkier: We say: ‘We’ll think it over.’ I’ve gone down that road and often what the buyer asks for is what doesn’t sell.
Falchi: Accessories are such an important part of a designer’s business. Now everybody talks about Michael Kors—finally, an American designer caught onto the fact that their business can be driven by accessories! That’s how the European brands do it—Gucci, Prada, Chanel—they’re all making their money on accessories. Ralph Lauren is making billions [2013 market cap reported at $13 billion] but his handbag business is still relatively small.
HBD Network: How are you handling the pricing evolution?
Falchi: It’s gotten so much tougher in China. Designers used to tell the factories what they wanted to pay. Now they tell us! I make my main brand in the U.S., but my line for TV home shopping line is produced overseas.
Botkier: Raw materials and fuel costs are going up so margins are going down.
Rafe: We’ve all sat in pricing meetings where we realize $495 sounds so much better than $500 (even though with tax it will be over $500 anyway!). We have to be flexible to give consumers the range they expect.
HBD Network: There’s a lot of pressure from the stores too. I’m hearing that now a certain department store trend buyer wants $100 leather bags because Topshop and Zara have them, but the difference is those stores don’t buy wholesale; they develop lines themselves.
Rafe: It’s hard; retailers expect certain things from us. There are economies of scale in large volume, but unfortunately, retailers don’t care if we’re not doing that volume to reach those economies! The customers don’t care either.
HBD Network: Hence designer diffusion lines!
Rafe: I was the first to do a handbag line with Target [in 2006, Rafe sold Under $50 handbags at Target]. And they sold great. It helped create the realization that America was ready for inexpensive designer accessories.
HBD Network: All new designers want to be in department stores right away, but that’s not the way to go! They have to be Willy Loman [“Death of a Salesman”] in heels. You have to go door to door. Plus, designers starting out don’t realize that this handbag has to cover the cost per square foot of real estate in department stores. Period.
Carlos Falchi: All new designers want to be in department stores right away but it’s a real estate business! The main floor is rented. But the mom and pops are where it’s at. They’re loyal and they’re there for you! The orders might be small, but they add up when you add them all up.
HBD Network: How do you take care of your influencers to keep these women and stores coming back?
Botkier: Trunk shows! You really get a sense of who your customer is… and they’re not all the New York woman.
Rafe: I love meeting the customer. And believe me, whe has no shortage of telling you what her needs and wants are in her handbag. We listen.
HBD Network: Designers are like rock stars—you make your money when you’re on tour, not on record sales.
Falchi: I love trunk shows. I do luncheons, fund raisers, etc. Stores don’t always reorder; their initial buy is their initial buy. Sold out? Done. So you need to go and promote with events to sell more. Stores don’t realize how much business we drum up during events.
HBD Network: Do you do formal research on your customers by demographic?
Botkier: We don’t do focus groups or anything like that. For us it’s just common sense.
Rafe: Even with the Jones muscle behind my brand, we don’t do such formal research. My research is talking to the buyers. I know that Asia won’t buy suede. It’s too moist there. We learn as we go. For example, our Japanese stores will pull out a tape measure and literally measure every bag.
Falchi: There are definitely regional and cultural preferences. Some inexplicable. Europeans buy ostritch and suede. Americans won’t. It’s the biggest mystery.
HBD Network: There’s a big push for Made in America or Made in the Garment Center. How has your production changed?
Rafe: I used to do production here but no more. I used to buy everything and the factory just did cut and sew.
Botkier: Me too. I found my factories in New York in the Yellow Pages.
Falchi: I still manufacture here, it’s addictive. I can’t give it up. But it’s very stressful and these families depend on me. Some of their kids work for me! But it’s stressful; I’ve already had a heart attack!
HBD Network: Where do you travel for shows and inspiration?
Rafe: I travel half the year. I go to China four times a year, plus the European trade shows and leather shows. I do Bologna for leather, Paris for fabric, and then I’ll travel to another city to experience something different. I recently went to Stockholm and Barcelona to get great inspiration from the streets.
Botkier: I don’t travel as much now that I have three kids, the youngest being three and four. But my team travels and we use Skype to help with overseas development. Plus, Italian factories come to us!
Falchi: I looooove to drive in Europe. I get in my car and go to the small towns. I speak six languages, which helps too! But I actually love to vacation here in America.
HBD Network: How many bags do you use in each collection when you’re designing the season?
Botkier: We start with a blueprint. We plan three deliveries and use our inspiration boards for each but we also use a DNA brand board. Then size of each piece dictates price.
Rafe: We begin with a Merch Plan [aka Merchandise Plan], creating a Good, Better, Best structure. We feature 20 to 30 skus in Better; and 15 in Best, for example.
HBD Network: Do you do trade shows yourself?
Rafe: My brand does but I don’t personally. I can design but I’m not great at selling. But trade shows are vital to finding retailers!
Botkier: The artistic personality and sales are two very different things. It’s very technical to sell, monitor the business, etc.
HBD Network: But when you start out as a designer, you really have to do as much as you can yourself. Not only to save money but to learn the business.
Rafe: In 1998, I sold all my stuff on my own. I carried a suitcase and walked into stores. I went to LA and my cousins had to drive me because I don’t drive! I walked into Fred Segal with no appointment and they took my line. My first New York store was Big Drop. I was more pushy then. I literally said, ‘You need to have these!’ and they bought them.
Botkier: I was so sensitive about my photography, but less so about my handbags. I got to know editors from my photography days so they looked at my handbags. My first press was in Lucky magazine. Yes I was lucky! Also, because I didn’t know the big buyer names at the big stores, I wasn’t really intimidated to call them. But if it was a huge photographer, like, say, Annie Leibowitz, it would have been different. I just didn’t know so I wasn’t scared.
Rafe: It was a different time. I just walked into W magazine with no appointment and talked my way into seeing the editor…while he was eating lunch!
HBD Network: Where was your first studio?
Botkier: I lived in a six-floor waglkup and was taking cash for bags. I finally moved into a live/work space on Crosby Street.
Rafe: I also started in a residential apartment and I had to hush hush the doorman to let me move all these bags in and out. Ultimately, that had to end and I got a real commercial space!
HBD Network: How involved are you personally in social media? I tell people to social media their whole process of designing and making a bag. It’s the fastest way to develop a foothold.
Rafe: I do 80% of it myself—Vine, Twitter, Instagram, etc. It’s so easy as there are apps for the phone, which is always with me. I’ll tweet while I’m at the airport waiting for a plane. And I love the direct communication with my customers! People will ask me where to get a bag I show. Plus, I tag buyers and editors at shows to come to my booth! I’m also really big on Polyvore. I’ll comment on people’s pages who use my bags. Social media has made us so much more accessible as designers.
Botkier: Agreed. I also love it and as it was new to me, I’m learning from the younger people! I do Vine, Tumblr, Pinterest, Polyvore, YouTube, etc. You practically have to run a whole magazine, so it is definitely time consuming. But essential.
HBD Network: Designers always ask me what’s the best way to contact buyers? Follow them on Twitter, add them on LinkedIn and get to know them that way. But be careful not to stalk them—you’ll be blacklisted. And one final note? On your website, always have a way for buyers to contact you! If you just have a full-in sheet as a contact, it’s a definite lost opportunity.