In this episode of Retaili$tic, Deborah Weinswig interviews Michael Kaplan, a prominent figure in the inclusive retail market, discussing his family's legacy in the fashion industry, the complexities of serving the inclusive size market, and the evolving landscape of retail marketing. Kaplan shares insights on the importance of commitment to inclusive design, the impact of tariffs on retail dynamics, and lessons learned from family business history. The discussion culminates in rapid-fire questions that highlight key takeaways for aspiring entrepreneurs and established retailers alike.
Video version of this episode can be viewed here
Takeaways
Human capital is the best asset any company's got.
The customer was family to us; it's very personal.
Store experience is way under invested in today's environment.
Get relevant, and stay relevant without losing your heritage.
It's a tale of two halves in retail; careful planning is essential.
The world changes all the time; adapt to consumer expectations.
There's a lack of ability to plan in the current market.
Capitalize your business appropriately for your goals.
The inclusive market is complicated but has significant demand.
You can't just expand into being a general doctor; specialization is key.
Chapters
00:00 Michael Kaplan's Journey in Retail and Technology
07:40 Understanding the Underserved Customer
13:47 Challenges in the Inclusive Size Market
19:50 The Future of Inclusive Design
25:47 Marketing Evolution in Retail
33:50 The Evolution of Retail Strategies
34:46 Impact of Tariffs on Retail Planning
41:21 The Bifurcation of Retail Success
41:48 Historical Perspectives on Retail Changes
58:23 Capitalization and Business Strategy
58:55 Lightning Round Insights
Deborah Weinswig (00:01)
Welcome to Retailistic, the official podcast of Corsight Research for September 16th, 2025. This week, Corsight Research CEO Deborah Winswig welcomes apparel retail royalty Michael Kaplan. Michael's great grandmother founded Lane Bryant, and he brought her vision to the 21st century as co-founder and CEO of Fashion to Figure. But before we go behind the scenes of the specialty retail industry,
Let's visit with Isla from the London office for our weekly update on new research publishing on CoreSight.com.
Deborah Weinswig (00:37)
Hi Philip. This week at Core Site Research, we're spotlighting three powerful reports every retail executive should have on their radar. First, dive into US beauty retailing, themes, concepts, and innovators from next-gen formats to brand led community strategies. We decode the innovation shaping one of retail's most dynamic sectors. If beauty is on your roadmap, this report is essential. Second,
Gain clarity with our 2Q25 US Earnings Season Wrap-Up. We distill key takeaways from leading retail earnings to help you benchmark performance, anticipate category trends, and understand the signals behind the numbers. And third, we're on the ground in Chicago for Shop Talk 4, delivering daily updates straight from the convention floor. Catch the energy, discover emerging themes, and hear what top industry voices are saying as they say it.
From category deep dives to strategic benchmarking and live event coverage, this is retail intelligence built for leaders. Subscribe to Corsair Research today and stay informed, agile and ahead of the curve.
Deborah Weinswig (01:42)
Thanks, Isla. Now here's Deborah and Michael.
Deborah Weinswig (01:46)
Michael, thanks so much for joining us today. We're honored to have you here with us.
michael kaplan (01:50)
Thanks, it's really my honor to be here with you, Deborah, long time admirer and ⁓ reader of your research and participant in your great group.
Deborah Weinswig (02:00)
Thank you. So Michael, you have a long family history of retail and research and technology. Can you maybe kind of bring us all the way back to the beginning of your career and how you got started?
michael kaplan (02:15)
Yeah, I mean, so today, you know, I focus entirely on, ⁓ you know, the $80 billion inclusive size clothing market in the US. And that's what really got me into my career. And largely for two reasons. mean, one, ⁓ my great grandmother invented the industry in the 1890s. you know, lot of pioneering stuff. And that was all amazing. I came along about 100 years later when my dad was
CEO of that ⁓ public company that was a household brand name. ⁓ I just was somebody that was enthralled with my dad and his work and everything that that meant. I didn't really know at the time, you know, as a younger person what any of that meant. I just knew that I was fully engaged in it. ⁓ And, you know, then after graduate school, ⁓ because of that being taken with that industry, my, well,
My family sold the business to the Limited Corporation as one of their primary purchases when Les Wexner was conglomerating specialty concepts. That changed everything in my family. And I had a very sort of typical career of a New York City kid growing up around a family business going off to college. And then I went to Wall Street as a Wall Street analyst. And I very luckily had an opportunity at the right place at the right time to join a venture capital firm.
which allowed me to relook at my family's business through the lens of innovation and technology. And I started a business ⁓ in the spectrum of what they were doing in the category. And then I went off to graduate school. And in about 2004, I saw an opportunity to, you know, that the market was still extremely attractive. I was very, and am, you know, very obsessed and,
feel like it's a five generation purpose and journey and focus on the market. And I saw an opportunity to, on a business level, just analytically look at where the missing pieces were. And at the time, it was in a retail store. And the market was growing. It was evolving. The manufacturing base was evolving. The amount of product out there for consumers was evolving. But the distribution channel had not evolved.
And so in 2004, because of that, I, at that time then used my, you know, Wall Street school and venture capital entrepreneurial training and rented a store in a shopping mall. And all the training went out the door. Cause I like, um, you know, uh, I think, you know, one of the famous things that my brother who, who had the background in the industry and knowledge and with my co-founder.
Deborah Weinswig (04:52)
You
michael kaplan (05:03)
I think one of the things I remember him saying to me was, you've done all this stuff. Are you sure you really want to do this? And we were in a shopping mall that we rented a store and ran that store 15 hours a day about for a couple of years to learn the business. And the concept, Deborah, was I felt at the time in 2004, one of the things that needed to be disrupted was to streamline the choices that were increasing.
for a customer who still had model brand retail stores segregating her from the mainstream. So we provided a mainstream experience in a retail store. And as any entrepreneurial idea ⁓ plays out, we obviously iterated and learned a ton. And we became actually a vertically integrated model brand for a very specific segment of the market.
We got to about 30 stores, nearly $50 million sold the business to private equity. It was very successful run. then private equity was also in sort of a classic way, was the undoing of the business and growing too fast, not measuring things properly, having the wrong partners all around, ⁓ taking on too much at once, not having the right controls and governance.
We, I took a very successful specialty retail concept that was serving a segment of this market very effectively and over capitalized it, broke it, restructured it. And I've moved on to where I am now, which is utilizing all of that experience that we talked about to buy businesses in the category ⁓ and run them better for the consumer, given all that we know.
I actually had an opportunity in 2020 to buy my family's business back with a private equity firm, now building on that experience. Unfortunately, the COVID pandemic happened and all the resources around the table there, whether it was the sourcing companies, supply chain, management team, senior leadership, technology designers, tech designers, everybody that was driving that billion dollars of sales in around 2018, 2019.
is now with me as a team consolidated as ⁓ or together as a holding company to go buy the various segments of this market, which I now have lived personally for 20 years and obviously as a family for 130 years. So I think that's probably more background than you wanted to know, but that's the story of how we got here.
Deborah Weinswig (07:40)
Now that's super helpful. So maybe talk to me about how you look at your customer and I think she's historically been underserved. Why is that and how do you look to change that?
michael kaplan (07:57)
⁓ it's a very complicated market. And I would tell you that with as much passion and drive and obsessive in a way that I don't think was psychologically healthy, as much obsessiveness as I went after my first concept, all of my assumptions after graduating from my Ivy league business school were all wrong.
And so if I'm somebody whose family invented the market and I had the best training to go after the market and I made all the assumptions after two years of study at a business school and went into the market and I took two and a half years and $3 million to learn what to do, you can better believe it's an extremely difficult, nuanced, very idiosyncratic, very complicated market that unless you specialize in, you're going to have a very difficult time.
It's why you see that there are a lot of the traditional retail operators that are excellent, excellent companies. And I would say that ⁓ old Navy is one of the most recent ones in the last couple of years, go into the market with a lot of fanfare and then exit the market because their classic operations, their classic model can't just be translated over the market. I like in this market to kind of an emergency room, which is
You know, there's fabulous doctors in the emergency room, but when somebody comes in with a traumatic brain injury, you probably need a neurosurgeon, not the ER doctor. Everybody's doctors, everybody knows medicine, but there's specialization. And so, ⁓ I would say that one of the, I'll start with some of the lessons I've learned and, and, and some of the things about when you asked about the observations of the customer. First of all, 85 million women in America, much less people anywhere are not a single market.
And that's just full stop, a kind of a disrespectful ⁓ thing. ⁓ Secondly, there's largely two variables in this market, which are usually one variable in traditional retail. So in the inclusive size market, when people choose the same taste preferences of a segment, whether that be
Deborah Weinswig (09:47)
Bye.
you
michael kaplan (10:13)
Missy or urban or fast fashion or you know, whatever it is when they choose that segment in this market and they're within that segment You actually very often times need to fit blocks Right for the lower end of an inclusive size range and the higher end of an inclusive size range and that's extremely complicated requires Certain resources that know how to do the technical design the technical fit the production the fabrication
You know, everything associated with doing that, that is also twice the expense for a traditional business that has that process done in a very traditional way. I would argue that if you look at some companies like an Anthropology or Madewell that are touching this market successfully, they don't have a line or a whole collection or a whole business in this market. They're taking certain categories that they do well in, Madewell being jeans, and they
Deborah Weinswig (10:52)
Hmm.
you
michael kaplan (11:10)
go at this category, I'm sorry, they go at this segment within that category because of the ability to learn this category within the expertise of what they do in ⁓ that category, they learn this segment. So it's very complicated. Then you go to the customer who is extremely nuanced psychographically. ⁓ Many Americans, especially with GLP-1 drugs now, which are
fabulous innovation medically. ⁓ Their mindset is very often, what price should I pay if I'm not going to be here for that, if I'm not going to be at this size indefinitely? I think also the criteria for what makes a successful purchase for this customer is very different for others. This customer ⁓ takes into account not only fashion style and not only price quality value, but function,
fit, lifestyle application, temperature for their body, ⁓ certain irritation on their skin. I mean, there's a whole other set of things that the provider and the person needs to be, I think, very focused on to effectively serve this customer versus other elements of the market. So you've got different mechanics going into the market, a high degree of fragmentation and segmentation.
Deborah Weinswig (12:15)
Okay.
michael kaplan (12:38)
Totally different psychographics that I would argue require a different maybe marketing department or different resources or different messaging or different things. And now you have a whole other business that has completely undone the premise that I'm an existing business. can, you know, expand into this category. You know, that's like, that's like saying, you know, I'm a surgeon and I'm now going to expand into being a general doctor and see general clients. It just, doesn't happen.
Deborah Weinswig (13:09)
And why do you think that, you know, mean, depending on the numbers that you look at, right? I mean, this this market is actually bigger than the kind of traditional size market. So why?
why don't we see, and obviously it's complicated and there's kind of new and evolving technology to assist with, with fit and some of the other things that you talked about, but why do we still see so many brands and retailers not focusing in what I would call to be the, really.
an opportunity to kind of introduce yourself to a customer along her size journey as I think you alluded to.
michael kaplan (13:55)
Yeah, I think ⁓ as my own life in this industry has evolved and gone on there's more and more reasons to answer your question. When I first got into the industry, Deborah, the answer to your question oftentimes was I don't want to have my brand conflict to serve both segments. I don't want to serve
you know, missy size or missy, you know, customers along with inclusive size because of it's just a completely different brand. And, you know, I'm not sure those customers would like to coexist in a specialty store or stores, what have you. As, as my experience in the industry has gone on, it's many, many more things other than that. And thankfully that reason is actually, you know, disengaged a little bit as a driver of the market. But
Take the old Navy case in point that I referenced earlier. It's not that they're not effective, capable, or have the ability or talent to do this extremely successfully. It's not as though they don't have the customer who possibly wants it there. And I don't notice to be a fact, but having run a, you
having run one of these businesses and having lived in this category, I assume some of the following things are going on inside that business as an example. They decide to go into the category and if they have a 10,000 square foot store, they'll now take 600 to a thousand square feet and say it's gonna be for this category. So now you have all of the buyers and merchants saying, just take away 10 % of my ability to make sales and achieve a bonus. Now you have designers that are saying, hey, I don't really know.
how to do this, I actually have to get different fit models, different sample making. ⁓ I possibly have to do ⁓ some contract design for people that know how to do the technical fittings and things of that nature and choose fabrications and merchandising. Then you have to go source that apparel, which might not be from the vendor that the company ⁓ is used to doing.
Then the finance department probably walks in and says, what's going on? We're not as productive in the thousand square feet as we are in the 9,000 square feet. We're not getting the unit economics that we typically get because we have a different vendor here. And I'm seeing that our fit costs and our sample making costs are going up. What's happening? And this is all by the way, when sales for what they're trying to do strategically are not effective because they need a couple seasons to learn. So at that point, they can either stick it out.
and, and, know, and, and, and go a couple seasons to learn and smooth that out and figure it out. But now they're like the startup climbing a learning curve. It's expensive. And like in the case of old Navy, if you're gapping your public company, it's a problem. Now I personally think that, you know, I would challenge somebody like Richard Dixon, like, you know, you should do this, get on this, right? Athletic does this well. I mean, why does that athletic do this well, but your other divisions don't.
You know, why have you let this fail across the board? know, I mean, I would show you, you know, I wrote an editorial. mean, I can easily provide the resources, the designers, the team, the people. mean, our group did a billion dollars, you know, several years ago. We can tell you how to do this within your stores, but they, as a public company and with existing traditional processes and defined expenses.
and retain talent for specific things, we're going to have all of those elements to figure out if they want to do this right. But I think somebody like Richard Dixon, just to finish that analogy, he's a great marketer. He ought to do it. He's actually somebody that can do it extremely well. His marketing background, I think, lends to possibly doing this. If I look at urban outfitters and anthropology, ⁓ anthropology is somebody who has stuck it out. They do touch the category.
Deborah Weinswig (17:37)
Mm-hmm.
michael kaplan (17:59)
cursory reading online is some of the things they do are very well reviewed. But then they run up to against a couple of other issues, which is this product for customers, like there is a customer within the market that says all of my girlfriends shop in anthropology. I'd like to go there too. I'm really now happy shopping together. But then when you sort a website by size, you go in a store, when you sort a site by size and it's a minority of items or you go in a store and it's in a corner.
it now becomes a dilutive stigmatizing experience for the consumer who initially was excited to go where all of her friends go. So when you ask your question about why don't people do this, I mean, I can tell you that
We have just specialized in it for 130 years. It doesn't make us smart, great, better than anybody else. But the reason I continue to do this, even after having both success and failure in my last business, is because if you know one thing, no matter how the world changes, stick with that one thing if there's demand for it and be the expert. So I think that's a long-winded answer to your question.
Deborah Weinswig (19:06)
Yeah.
Well, I think that you bring up something really important, which is that there have been so many... ⁓
companies, individuals, P, E, C who've tried and failed. And so I think it goes back to it's an incredibly complicated category. And I want to give a shout out to Janice Wang at Alvinon who back in, yeah, back in 2018, was right when we had spun out. So we were also just, you know, trying to find our way. And she's like, you know, we really want to do a conference around inclusive design. And so, you know, we put this conference together.
michael kaplan (19:35)
Totally.
Deborah Weinswig (19:50)
You usually assume, however many people sign up about half show up, well, they all showed up. Because if you think about it, it is kind of like the holy grail in terms of you are able to, and by inclusive, we were also looking at adaptive. So for people who didn't fit into kind of like a standard garment. And so if you started to look at the sizes of these markets,
michael kaplan (20:14)
Sure.
Deborah Weinswig (20:20)
together, right? All of inclusive design was probably as big as the existing apparel and footwear market, but yet nobody focused on it. think that, but it goes back to your point. It's complicated. know, those who are trying to support, right? They're trying their best, but they may not know exactly what's needed going back to some of the kind of challenges around kind of fabric fabrication. And so as you think about kind of
body forms and also you look at kind of what's currently available. If you had a wish list, what would be on that to get us from kind of where we are today to where you see the opportunity tomorrow?
michael kaplan (21:04)
⁓
Deborah Weinswig (21:04)
Thank
michael kaplan (21:08)
My biggest wish is that more people on the finance side, the brand side, and the design side have a longer commitment to doing this because they will climb the steep learning curve and pay the expenses to do it, but they'll also codify some of the lessons like we've been through and I've been through.
Deborah Weinswig (21:08)
Bye.
michael kaplan (21:32)
You know, having grown up around the market leader, I came out of business school with the idea that I told you in 2004, we launched and I capitalized something over a life cycle of a business, you know, with money to try to conquer an $80 billion market. Right. But my concept was not an eight. You my concept wasn't for the whole market. And I only learned that after the fact. So, ⁓ you know, I had smart investors that
You know, I mean, somebody might debate whether they ought to, you know, have left me alone as much as they did, but none of us, as smart as any of us were, understood that capitalizing the business with as much capital as we did was not justified for the segment we were going after. So it would be great if, you know, finance firms that are absolutely critical to entrepreneurship and putting these ventures together.
would also learn some lessons that I'm not going to capitalize and go after the quote plus size space, but I'm going to go after the Gen X mid-size space or the urban working woman junior space or something. Because it's very, I think, sexy in the finance world to say this is an $80 billion market growing at 19 % a year and I'm going throw a ton of money at this.
Deborah Weinswig (22:58)
Mm-hmm.
michael kaplan (22:58)
You know, think
somebody like Sycamore, right, who's bought, ⁓ you know, and created Torrent and now they own my family's business, Lane Bryan and other things. It's one thing at the highest level to go be the billion dollar player. think everybody else developing concepts, which is what I would have on my wish list is I think a proliferation of concepts should capitalize them appropriately and not for the market, but for the segment.
I think what's going on in the design schools, the focus on the category is great. And I think that it's actually going to help every part of the market, not just the inclusive size, because people learning the craft of fit design, tech design is critically important to have better utilization of clothing and a life cycle of a garment. I would like to have...
more US companies committed to saying, we're going to...
stick it out for a period of time with a period of capital, with a period of resources, and get to a place that we stake out. know, Catterton, and I was helpful to them in diligence, invested in a company called Bloom Sheet. I don't know a lot about the company and its sales, but they're based in China, they're associated with manufacturer, and think within a very, very short period of time, they're doing $300 million in sales.
and it's mid and inclusive size, ⁓ sort of a lower mid price point, fast fashion thing.
I don't know much about the business, the brand, the people. I can't speak to the quality of it. If you can go from zero to $300 million, you've committed the right resources and capital and focus and strategy and team to provide for consumers. At the end of the day, I would like consumers in this category to benefit. The biggest number is not the size of the market and the growth of the market, but it's that
It's 80 % of women in America and only 20 % of the stuff they get to choose from. I just would like that supply and demand to be less dislocated because there's room for a lot of players. Frankly, players would be great clustering together so the customer has a lot of choice. And I think it's going to require some companies to make some tough choices, but stick it out. Stick it out with their capital, capitalize appropriately.
Deborah Weinswig (25:07)
Thank
michael kaplan (25:32)
modify their business models in ways that might be costly and require time to learn and then, you know, get the talent and invest in the talent that knows the category and the customer both in marketing and
Deborah Weinswig (25:47)
And as you think about this kind of 80-20 and this massive gap, do you think that this category is better suited online, offline, multi-channel? What do you think is the best way to serve this customer?
michael kaplan (26:05)
So, you know, for me, asking me that question is different probably than the average person. I I look at these things in multi-hundred year windows just given like the house I grew up in. And I would say that like the world changes all the time and you better be good at whatever customers are expecting with a fabulous experience and great product.
You know, we've just partnered with and we're merging with a company called Nadine West, which is relaunching itself out of Texas. They're a subscription company that is focused on value price consumers. And they're 11 years old and at their height, they have done close to $80 million in sales and were wildly profitable. The founder there, who's the leader there, is a very good friend of mine and
The reason we're very good friends is because as somebody who's from Texas and has got a very different background than me, we both have a love and passion for consumer experience. And when you have a passion for the experience of your consumers, remember your consumers are typically fourfold. Your consumers are the end user of your product, but they're inside your company, they're your business partners, and then your investors.
Right? mean, you want everybody to have a fabulous experience when you're walking in direction. So.
I would use his business and Nadine West as an example of when you ask like, what's the best way of doing it? I think the best ways change every quarter in the kind of world like we're living in. But what doesn't change is the experience and the product and a commitment to that. You know, when I look at my family's business, I look at, know, all right, the horse and buggy became a car 10 years into it. And then it was World War I, you know, 20 years into it. And then it was the Great Depression 30 years into it.
And then was World War II, 40 years into it. And then it was, you know, Vietnam, 50, 60 years into it. And then it was, you know, the inflation of the 70s, 75 years into it. And what doesn't change is the experience and the product and effectively connecting with the consumer. So I always find it funny when somebody says, what's the best way? Because the best, if you're figuring out the best mousetrap now, Deborah, it's probably too late.
Deborah Weinswig (28:31)
So that makes sense. So because the world is that small, so you're talking about Ben, right, at Nading West?
michael kaplan (28:37)
Yeah, Ben is my partner and he's he's
we're finishing a deal with him. He's a fabulous guy, fabulous person, and I'm really excited. He's he's a critical part of our platform as we're looking to complete some other deals right now. He's got now an entire AI backbone ⁓ for ecommerce and marketplace. 11 years of data.
About 40 ish percent of this consumers are inclusive size price sensitive But what is exactly the same about him and me is that we have this desire? When the customer has a touch point, you know make them feel as though they left us with a fabulous feeling and you can see that this entire organization and everybody I've met with him. So I'm really excited about going out the world with him We actually put this together in February. We went out and we began looking at ⁓
for some capital partners and then tariffs hit. And again, you know, looking at things non-conventionally while he and I thought, you know, tariffs hitting and our story was gonna hit a roadblock. Actually the other opportunities and deals that we've got to buy actually presented themselves more attractively to tack onto his business and utilize our supply chain and design ability and unit economics and.
you know, all the things we've got globally, it's now opportunistic because of what's happening with the world. We're leaning into, ⁓ you know, the pricing changes and the pricing changes for consumers and all these things because, you know, as one of our other partners likes to say, people aren't going to be walking the earth naked anytime soon.
Deborah Weinswig (30:15)
Right. No, I mean, I was just on a call with him yesterday. like, it's just that the world is like that small. And so it's, know, I do think like, you know, the two of you are true visionaries in this sector and having that overlap in terms of, you know, customer centricity, you know, you don't, you don't find that often. And so, I mean, to me, I always felt that if you catered to the customer who was underserved, right, you would win her.
michael kaplan (30:21)
Yeah.
Deborah Weinswig (30:44)
you know, kind of through thick and through thin, right? Through no matter what happened, because especially around fit. And, you know, and these days, think marketing is such a huge part of, you know, the consumer experience. How have you seen kind of throughout your career marketing change and especially marketing to this customer?
michael kaplan (31:03)
Um, you know, it's interesting. I've learned a lot from my brother who, uh, sort of grew into this growth officer. now, um, he's sort of like a real kind of growth guru for, for consumers. Um, and one of the things he mentioned, which I agree with a lot is, um, marketing, you know, used to become the keeper. It used to be like, who is the keeper of the flame of the brand? You know, the creative director and vision person and the marketer would really, you know, make certain that.
you know, the drum was being, you know, beaten all the time. There's a steady drum beat of what this brand is and how do we put it out there in the content calendar? think, you know, as the world's become digital and the touch points are multi-channel faceted, you know, there's brand marketing, there's digital performance marketing, which is acquisition. then there, you know, there's retention, there's reactivation. You know, there's like,
content calendar narrative and content creation type stuff. mean, it's so multifaceted that I don't know of a chief marketing officer like a CMO who like, to me, what I've seen is that really good people now are people that kind of can put a suite of people around you to wrap your customer in all of this in a way where the numbers dictate that
what's happening is very profitable. So that's one of the good things about Mark. mean, so it's becoming exceedingly more complex and it's much more ⁓ vast across areas. It requires more expertise and that's, think, something that's nebulous. I think something that's quite helpful is it's become very empirical. I mean, when I was in business school, ⁓ we
there was like the famous adage of $1 of every four in marketing goes to see if the other three were effective. And it's like now we're in a place where return on ad spend and lifetime value and cohort value and I mean, you can really do a lot of activities and with attribution and I mean, and by the way, there's a lot of stuff here that again, I think about my brother like.
There's a lot of stuff here I have no idea about. I'm not, it's not my expertise, but I know that there's such granularity in the world of technologies and systems and how you measure them and measure the touch points of your people. I think what hasn't changed though is that all still needs to all bubble up to a customer experience and level of engagement. Right? mean, you sure, you probably need to send some direct mail to people. We've seen
companies in the last 12 years go from, got to spend every dollar online because of the payback to if I do that, my store experience is bad and now online is so expensive, so let me do some direct mail and catalogs to I better open stores because I'm Warby Parker and I can't buy people online anymore. I so this thing meanders quite a bit and it's going to continue to meander in terms of like what's effective and what's new, but what's not going to meander is it all better lead up to the same thing, which is people love your brand.
You know, mean, like, however you, however you, you, you push these marbles and these channels and it's different for every business, it's still better lead up to the same thing, which is, you know, gosh, this brand has my attention. It has my hard earned dollars and I really like being there and it's quite easy to be there. And it's, it's, you know, it's kind of like that Amazon factor. It's really easy to do this.
Deborah Weinswig (34:46)
Yeah, that's a really interesting point. I think that the, know, as we kind of take a giant step back and, you know, with the tariffs and just a lot of the noise in the environment, how has that
caused you or what's kind of ignited you to kind of just rethink everything? Because I mean, we see a lot of retailers these days, right, shipping products with no prices on the tags, right? mean, there's a lot, you know, it's like everything and nothing has changed. How has it impacted, you know, kind of what you're doing specifically?
michael kaplan (35:21)
Right.
Well, I think tariffs for everybody, you know, look, I'm not the smartest at anything. I there's people that you should ask that question to that are a whole lot smarter than I am. You know, they understand international trade and why things should be what and how to prepare and have a plan. I think for the average person like me, the difficulty for us is when we organized our holding company, we were really excited to partner with
you know, the Asprey sourcing company, was, you know, it's a sourcing company for a lot of different businesses and the limited corporations arm that was in India, you know, they're all over the world. The current generation of the business actually serves as the chief sourcing officer on our platform. He's a great colleague. And I think one of the things I see, Deborah, to answer your question is it just, there's a lack of ability to plan.
Deborah Weinswig (36:14)
Thank
michael kaplan (36:20)
I mean, you know, like we, was really excited to partner with this guy and his business and his family's business and really know that we could have like many different points of origin in the world. like, for example, not for any like geopolitical reason, but like we don't do anything in China in our, in our operation. Like we're in, you know, ⁓ Columbia and Latin America and Korea and India and Japan and Tokyo. like, you know, like for example, the, you know, our largest partner is a mill. ⁓
Debs, which is a fourth or fifth generation mill. It's probably one of the most well-known ⁓ fabrics that nobody knows that the company is private and it's run by a family, but it's a fabulous, fabulous materials company. But for us, it's like, we call them and say, can you ship out of Indonesia? Can you ship out of Tokyo? Can you ship out of Mexico? Can you ship out of here? The thing that's rethought is, I don't know where, one of the...
the obstacles in our industry is lead time and planning and supply chain time. And I think with tariffs right now, I would have loved to have seen them roll out. And again, I'm not an economist. I don't know if we should have tariffs. don't know the background of the issues, but assuming we were gonna do this, it would have been nice for them to be rolled out to say, look, the next 18 months is gonna be tough. We're gonna do this. So plan accordingly. And...
That's just not happened so that every 30, 60, 90 days, there's like a new thing. mean, six months ago, nine months ago, everybody thought India was great. Now it's a problem again. so I think that's the thing that it's made everybody rethink. I think we're not going back to what was. I mean, it's priced in here. I think it changes unit economics across the board. think...
A lot of the multi-brand retailers that do a lot of chargebacks and things like that ⁓ are going to lose some of their vendors because those vendors don't have those sort of extra cushions to accommodate. ⁓ And I think that you look at the stacks of avenues and companies under real financial distress like that, this is not good for them. know what mean? Their vendor base is more hawkish than ever.
and they're slower than ever in payments and because of the environment and uncertainty, that's not a good combination in my opinion. I mean, I don't know anything. That's not my job to understand luxury or that, but that's how I rethink things, which is some places of distribution like me will go away. And this world that we've had the last 10 years of people either really flourish or they fail. There's kind of no middle ground.
I when I look at the companies of the last five, 10 years that have been absolutely awesome, and I look at like Skins or Yori or Lululemon or Allo, these companies that not only, they're not just surviving, they're crushing it. They're really making a spark and they're hitting on all cylinders and they're creating tremendous financial payback for investors and value for customers and all these things. And then you have other companies that are not, companies are not just kind of like,
Also existing. I mean like Coles is like teetering right? I mean and again, I don't know that I don't I don't know You know, but like, you know, have companies that are reporting earnings that are you know and comp sales that are like going through the floor so I Think what it the way it's made us rethink things is the world's very bifurcated, you know, it's really a tale of two halves I think you got very careful about where you play and where you don't who you engage with new you don't I think
It's impossible to do proper planning given, you know, the people that are, you know, rolling all this out. And there is no, there is no strategies. I mean, there's a strategy, but there's just no kind of predictable cadence. It doesn't seem like, ⁓ and that's a problem. And I look, I think that, you know, people flock to safety, right? I mean, you know, people doing well, Ross, TJ, Burlington, Walmart, you know, those are people that can absorb.
some of what's going on and they start with low prices and so the customer continues to go there. think some of the people, some of the independent chains that, like my old chain, I worry about what my old chain would be doing now in this environment, right? I mean, as a small $30 million kind of regional player, I'm sorry, small 30 store player, that's what would be very, very vulnerable at a time like this. ⁓
You don't command the scale. I think some of those players will be a problem. So to customers, shop local. Shop local. Keep those people around. That's where creativity happens.
Deborah Weinswig (41:08)
Yep.
If.
Now you're totally right. So can we, let's kind of go back in time because, you know, as somebody who studied the industry, I I certainly remember, right, of, you know, Lane, Brian, Dress Barn, Fashion Bug, Catherine's, all, you know, Charming Shops, Acina, right? I mean, all of those kind of coming together and then the change that happened. Can you walk us through kind of...
at least from your perspective, what happened and when, and if there was a decision that was made at the time that you think altered the course for the better or for the worse, can you also dive into that?
michael kaplan (42:00)
⁓
Yeah, I mean, and I think the question you're asking about history is probably exemplified today by a company like Torrid. Right. mean, Torrid went from 200 million to a billion. They they fabulous offering, you know, fabulous bunch of years, fabulous payback for, you know, I mean, people can can talk about the the
private equity industry, whatever, like some of the best people out there in this industry are running that or own that business and drove it and got the payback for it it's great. But now where is it? Right now it's a public company and like the growth is behind it and the paybacks behind it and it's a public company. So what's the issue? I think you're kind of asking that as it relates to kind of the history of the industry as well, which is like what happens here?
Like what happens when people kind of have a flashpoint and then, you know, they go away.
You know, there's a lot of people who believe that, sorry, go ahead, Deborah.
Deborah Weinswig (43:04)
No, I think that that's exactly right. And so you've seen an evolution, but did it evolve this way because of the decisions that were made? Right? Was it exogenous factors or was it decisions that were made to kind of take it in that direction?
michael kaplan (43:23)
So I think it's not one answer, right? I mean, it's multifaceted, okay? ⁓ Yeah, no, I mean, look, I think if you look at certain companies, like, I'm not, there's a lot of people who are really, really smart that believe, you know, brands just have a bell curve, right? Like brands get hot and they have a bell curve and you gotta ride it up and ride it down.
Deborah Weinswig (43:28)
her rose.
michael kaplan (43:46)
That's probably true in some cases, but then you look at a Ralph Lauren, or you look at Dillard's, or you look at ⁓ Prada or Max Mara. Yeah, there are certain brands that have their moment for sure, and then you've got other brands that are stand the test of time. And what is it about that? Because it's sort of like that maybe surfaces to the answers of
questions you're asking is like, does one make choices and one not? Well, it's never, there are never any silver bullets, right? It's all the details. You know, I mean, it's, it's, we take in capital? Do we make a change? Do we go in this direction? Do we hire these people? Do we do this? How do we recover from some of these wrong decisions? You know, it's all of that stuff. But I think there's some tenants that, that are important as it relates to participants in the industry, right?
I've had people say to me, you Michael, why are you still at this? You you succeeded for a certain period of time. You you can do whatever, you can do a number of different things. Why are you still at this? Well, the love and the passion and the desire and the history and the legacy and the things that drive me are going to be very different than the things that drive the person that has exactly my background and CV next to me.
And that person next to me actually may be a better hired CEO of a business. Right. But I have, you know, intellect and experience and emotion and desire and passion and history and everything driving me. And I would argue that like, and I don't know them, but I would imagine the Dillards do as well. And I would imagine that, you know, Mucciana Prada, what her name is on the door does as well.
And I mean, I know a little bit about the company Max Mara and you know, it's a family run, you know, business and you know, I imagine they do as well. So in some cases, I think the thing like, in some cases, you can have certain ingredients that you know, the business is being built to withstand the long haul. Now, if you've got those ingredients, you need to make sure the other ingredients are there too. Right? Like my fatal mistake was
When I took in private equity to my business, that's in conflict with everything I just mentioned to you because their core business is getting their money back in two to four years. And, you know, they have customers who are their LPs and that's directly in conflict with what I just talked about. So in some cases, when you ask what's happened, it's just wrong elements like that happens in some cases. In some cases, a business will, and I would argue by the way that Lane Bryant
that. mean, my family was never known. mean, Lane Bryant was never known as, you know, like
Well, let me try to diplomatically say this, Debra. We saw Lane Bryant on a Saturday Night Live skit earlier in the year and it was very controversial. got a lot of press, you know, because I think you remember there was those two stars of Saturday Night Live and they were in a zoo and one of them said, this doesn't scare me because I've worked at Lane Bryant. And it was written, it was really denigrating comment and it was not thought of as.
Deborah Weinswig (46:54)
Mm-hmm.
michael kaplan (47:19)
humorous by half the people who have written about the press. That never would have happened in my family's tenure, not because somebody wouldn't have thought about it, not because we were doing anything, but the way that the business comported itself didn't lend itself to that. Now, that doesn't mean that the company today is not incredibly in incredibly good shape. I I look at the same owners that have created billions of dollars in wealth in their financial
you holders, they're looking at the math and the details. They're not looking at the way I would, you know, like CEO of the business that, okay, my great grandmother invented this. I've done this. I take every customer interaction personally, you know, so the product has to be like, there's just a different ethos with which they're going to do it. It doesn't mean one's right or wrong, but it does lend itself to you're asking me questions. happened?
Deborah Weinswig (47:56)
Right.
michael kaplan (48:16)
Because it does mean that there's gonna, in one case, it means there's gonna be big swings in, you know, until they try and throw some things against the wall and get it right and come back. And in their case, as an example, when you've got professional management in a company, they can make choices to undo certain categories like Torrid. I haven't looked at Torrid as a business in a while, but I was right next to them for a lot of years. They were an absolute juggernaut, great management.
And if you looked at the store, it was absolutely the industry's place to go for jeans. They had like 25 % of the store floor, something like that, was a jean. And they ⁓ had brought in somebody, this is my understanding, by the way, that they had brought in a very talented person who knew how to do cuttings and fittings for this consumer. And it was a big driver of the business. They've probably gotten away from that to do the next thing and haven't figured it out yet.
Deborah Weinswig (49:00)
I'm
michael kaplan (49:13)
because they're not living or dying by, are we the gene company? know? know, Catherine's and Fashion Bug, I don't really know enough about those cases, but that too, I would say, is an example of what I'm talking about, right? I knew the Wax family, who was the one by Charming Shops, incredibly lovely people. It was a multi-generation business. It was out of Pennsylvania. They, I think,
the business that started after one of the patriarchal members came back after a war as a veteran, ⁓ was doing something extremely special, but then left the business and it was put in professional management's hands and started to go sideways because that often happens. That often happens. Then I think when the business was bought by a scene of retail, it was just an absolute dollars and cents financial decision to shut through division.
Deborah Weinswig (49:48)
Yes.
Yeah.
michael kaplan (50:12)
So.
Deborah Weinswig (50:12)
mean,
but it's interesting if you go back and you look at Asina, right? The idea had always been to leverage back office. I think most of the deals that were done were done at a price that could allow that. But somehow when it all kind of came together, it ultimately obviously didn't succeed.
michael kaplan (50:37)
Right. Yeah, and I don't know enough about the intimacy. I will tell you this, that David and Richard Jaffe ⁓ couldn't be nicer people to me. I think that they're, David Jaffe in particular is just a salt of the earth person that has been incredibly just nice and wonderful to me. And Richard, who I've met, I don't know as well, is also a really nice person.
Look, is it possibly taking on too much of a debt load? it not, you know, like when your family starts a dress barn operation. I mean, I remember having lunch with David and he used to tell him, I think there was a story, I'm not going to tell it accurately, but I think his parents, when they worked the floor, would ask their bag vendor about certain orders in some places, because they would then ascertain volume in certain areas and open up a store there. You know, when you go from that
Deborah Weinswig (51:23)
Mm-hmm.
michael kaplan (51:37)
to a big public institution, that's just a different way of running things. They got very big very quickly. I think it's extremely hard to pivot and change these companies in dynamic times when there are $7 billion with 7,000 stores, many divisions, ⁓ many different people. ⁓ I think a lot of people who probably had a lot to do with that
company and we're on the inside, no far more than I, you know, to be able to share that with you. ⁓ But I will tell you my opinion about Lane Bryant, who I competed with during that time. And when I saw them with that was
I don't think it was effective management of that division in terms of the brand's positioning, in terms of the merchandising pricing strategy, in terms of the assortment plan, the store operations. I think, you know, I'm really lucky to ⁓ call a colleague, woman by the name of Lindy Heasley, who I was introduced to by a professor of mine at business school ⁓ who used to be the vice chairman of Limited. you know, Lindas run companies like
Lane Bryant and limited and Jay Jill and other places. And I think some of the things she did there, particularly with like, you know, there's a decision she made to reassert the casique division with a refitting of cup sizes and other things. And so it solidified something they were doing well. Right? Like it was. Sometimes that's an effective strategy that answers your question when you say it, because your question is kind of like what happens or what, you know, what.
Deborah Weinswig (53:04)
Huh?
michael kaplan (53:20)
Sometimes if a new team or professional team can come in and dial down on something a brand is really known for, right? Like, I don't think anybody's ever gonna come into Ralph Lauren and not have polo shirts there. Right? And by the way, nor should they. But perhaps they're gonna make them from a different fabric at some point to drive more sales to those older people. ⁓
Deborah Weinswig (53:34)
Right.
michael kaplan (53:46)
I think when a lot of people come in and do a brand new thing and they eschew the essence and roots and guts of a company. But for everyone that you're asking about, why is there such a change, Deborah? There's a Mitchell and Richards, there's a Dillard's, there's people that are just massively passionate and stood the test of time. I G3 Apparel, those guys are ⁓ now the second generation. look at somebody who's a friend and mentor of mine, Randa, is a private company, Jeffrey Stiegel. ⁓
You know, this, companies 115 years old. So, you know, as much as, as much as things, you know, you ask things, why things change. What's more interesting to me is if a place like, you know, the business school up at Harvard, where I, I learned the case method, they would do a study of these cohorts of companies and why does some flourish and why does some go away? I think it has to do with founders and purpose and, you know, types of like.
Deborah Weinswig (54:18)
Yeah.
michael kaplan (54:44)
personalization of the management versus simply just the tactics, which I think is behind your question. I don't think it's tactics. I think it's ethos and mission and purpose.
Deborah Weinswig (54:54)
Yeah, I mean, I think ultimately, right, if you just look at the numbers and, you know, from an Asina perspective, right, I mean, the and I think you referred to it, right, the the debt load from Ann Taylor, I think ultimately, right, you know, you're like a duck, right, you're trying to kind of, you know, move forward, but you're just not really able to. I think if all of your focus ends up over here versus on the business that
michael kaplan (55:06)
Yeah.
Deborah Weinswig (55:22)
ultimately leads to, I think, what we saw. so I think, which is obviously quite unfortunate. So I do think that the challenges, right, in the sector, right, when you're growing through acquisition, and especially with family businesses, when you start to kind of take that heart and soul out of the business and it just becomes a numbers game. And let's say if, you you always feel like you're a day late and a dollar short, right, it becomes a, you you start to cut corners, I think, of places where the customer
realizes. And I think going back to a lot of these family businesses, the customer feels like they're part of a community. And so yes, there's loyalty programs and personalization, gamification, all that. when that real kind of community changes, I think it can have unintended consequences.
michael kaplan (55:53)
100%.
think you're saying something that's more important than just, ⁓ I think it's a more profound point than you just made that you hit on something that I think is really important to share with your listeners, which is the result of what you just said to me and what somebody should take away is capitalize your business appropriately for the business plan and goals you have, right? Because it's fantastic to be an entrepreneur and want to create something and sell it. We have a wonderful economy in America where you
and should do that, that's your goal. If you want a business until you're not, you know, six feet in the ground, you should capitalize it very differently than that, right? And it needs to be self-sufficient. There's no right or wrong in those, but there's wrong capital so that somebody doesn't end up just what you just said, which is thinking about the capital every day versus the customer, right? Like it's, I think capitalization is something that's glossed over too much. The other thing I think that you,
Deborah Weinswig (57:03)
Yeah.
michael kaplan (57:10)
indirectly made the point that is something that we're leaning into, is, you know, when the capital markets are over a sector, right, because the sector has seen a lot of trouble, there's, I think it's one the most difficult things for me, past couple of years has been, I was taught in venture capital by some very successful, smart people that are still mentors and friends of mine today, to always pay attention to the market and what the market's telling you. Being a contrarian is really hard.
but it's also very opportunistic, you know, and it defies their advice, right? And what I mean by that is one could argue that, you know, everybody's over consumer brands, nobody's investing in consumer brands. Look at what's happening. My judgment is, okay, that means there's never been a better time when the tide is out to see who's naked and not, and, you know, get things. Now that's, that's me and what I want to do and my story. I'm not, that's not a universal truth. I'm just saying it's.
Deborah Weinswig (57:40)
Yeah.
right.
michael kaplan (58:08)
These are the, I think the offshoots of the points you made are vast, right? Like how do you capitalize your business? What do you look at? What do you want to go do? What's the approach and strategy you want to take? These things are critical to the venture's ultimate success.
Deborah Weinswig (58:23)
absolutely. All right. So we're getting to the point which, you know, we didn't give you a heads up, but that's the whole point of lightning round. So we're going to ask five questions. If you want to pass, take a pass. If you, you know, kind of need a phone or friend, you know, do whatever it takes. So, all right. So are we ready?
michael kaplan (58:44)
Well, given that I know you, I am a little ready. everybody listening can already tell I talk too much, so they know we're not going to get in trouble here. So go ahead.
Deborah Weinswig (58:55)
All right, so most important lesson from your family business that taught you about inclusivity in retail.
michael kaplan (59:04)
People are, human capital is the best asset any company's got.
Deborah Weinswig (59:10)
All right, biggest difference in terms of how you saw your family treat the customer and how you've seen others treat the customer.
michael kaplan (59:21)
The customer was family to us. It is family to me. And it's a transaction elsewhere. I mean, this is not business to me. It's very personal.
Deborah Weinswig (59:33)
Excellent. Number three, most underrated retail lover for building loyalty.
michael kaplan (59:41)
store experience in today's environment, way under invested in and you know, people are focused on it third or fourth, but be on your store floor and get like, be on your store floor and meet people personally. You'll learn more than anyplace else and you'll cement a relationship with someone.
Deborah Weinswig (1:00:00)
Number four, a leadership decision you are proudest of during your time in retail.
michael kaplan (1:00:12)
That's a tough one because being an entrepreneur having grown from a piece of paper to scale, always felt like it was an absolute circus I was holding on for dear life to figure out. But I think the thing I'm most proud of is leaning into the family background and story and ethos and values, even though our concept was so different than what the family was doing in some modern times.
I had a very good friend and mentor tell me once, you don't drive a car looking in the rear view mirror, right? You look at the windshield, the rear view mirror is supposed to be informative. So it was a little dangerous to say, let me go drudging up history and dig up all this history of family stuff that was decades ago. I'm pretty proud that I did it because it made me discover a love that I've got to help other people. That's clearly what the family work was based on.
Deborah Weinswig (1:01:07)
Thank
michael kaplan (1:01:10)
And so I'm really proud to have gone into it and do this and dig all that up again for another generation of people.
Deborah Weinswig (1:01:19)
Nice, alright and number five, the one piece of advice you give to someone inheriting a heritage retail brand today.
michael kaplan (1:01:30)
Get relevant, don't lose the, don't get relevant and stay relevant without losing the lineage and guts and personality and heart and soul of what got you here.
Deborah Weinswig (1:01:47)
Great, Michael. I could talk to you all day. mean, there's so much to learn. You have such a rich background. Thanks for
michael kaplan (1:01:57)
well, Deborah, it's an honor with you. do it any time. It's, it's, this isn't, this is no headache for me. Talking to you is a pleasure and I learn more than you do. So it's always great to see you.
Deborah Weinswig (1:02:11)
Thanks, Deborah, and thank you for joining us this week. CoreSight Research serves our subscribers with strategic insights, retail tech reports, and consulting services that create global advantage. Visit us at coresight.com to learn how CoreSight Research can support your success. Have a wonderful day, and we'll see you next week.