Spinning Profits From Nice Threads

Blue Fish blends retail savvy and social responsibility

When shoppers choose the funky, flowing garments of Blue Fish Clothing Inc., they're often drawn to their comfort and artistry. But Chairperson Jennifer Paige Barclay, who founded the $12 million Frenchtown (N.J.)-based business in 1986 at the implausible age of 18, says there's another appeal woven into her threads--a philosophy. Made with natural dyes and pesticide-free cotton, her designs feature artist-signed, hand-blocked prints. Blue Fish "is about something that has meaning" made from "products that are sourced responsibly," she declares.

Beneath the artsy, socially conscious image, however, thrives a shrewd, expansionist spirit. Blue Fish sales climbed from $110,000 in 1986 to $11.6 million last year and $10.9 million in the first three-quarters of 1997. Nearly 450 stores carry the line, including its own five shops, scattered from trendy Santa Fe, N.M., to affluent Westport, Conn.

"SPIRIT KEEPER." Early next year, Blue Fish plans to relocate to a cavernous former Crayola factory in Easton, Pa. To help finance the expansion, the company has drawn on a $4 million kitty raised in 1995 and 1996 through a direct public offering. Barclay's own philosophy drove the decision to eschew bottom-line-oriented venture capitalists and instead sell stock directly to the public without an underwriter--a financing approach that's growing in popularity. The idea, she says, was to "sell it to people who'd been supporting us so far as customers." Blue Fish went public at $5 a share and now trades at around $4.

Unlike its stock, Blue Fish's garments aren't cheap--a T-shirt can cost $58 and a dress, $200 to $300--but the style holds up from year to year. "It's for a consumer who doesn't want to look like they stepped out of a catalog for Liz Claiborne," says Alan Millstein, Fashion Network Report publisher. That includes such stars as Julia Roberts, Meg Ryan, and Nicole Kidman. But Blue Fish also lures ordinary folks like Deborah Umansky, 47, a Santa Barbara (Calif.) psychologist who long ago gave up miniskirts. "People with different kinds of bodies can wear them," she says.

Spending relatively little on national advertising, Blue Fish cultivates its loyal customers by building its own buzz. Public-relations director Ta Kimball--her official title is "spirit keeper"--has landed Blue Fish fashions on popular TV sitcoms with female stars such as Grace Under Fire and Veronica's Closet. The company co-sponsors hip events, too, like the American Comedy Awards and Taos Talking Picture film festival, and holds community events and classes in its stores pegged to New Age and social justice themes.

Art, commerce, and social conscience are woven throughout Barclay's life. Born and raised in exurban Bucks County, Pa., she studied art at Temple University and started making her own clothes in her parents' garage. Soon she was selling them at craft and music festivals. Then, at a wholesale show in New York, she landed her first large orders. With a loan co-signed by her parents, she set up a factory in 1986. Today, Blue Fish employs 200 people.

Despite the attention and respect Barclay has earned--the U.S. Junior Chamber of Commerce named her one of its "Ten Outstanding Young Americans" last year--she has had setbacks. Because of its expansion, Blue Fish lost $248,000 in 1995 and $37,000 last year, but is expected to earn $102,000 in 1997.

Barclay takes great pains to emphasize her "strong business acumen," and she's surrounded herself with business experts: Blue Fish CEO Marc Wallach has 25 years of apparel experience; board members include Ben Cohen of Ben & Jerry Homemade Inc. and Gary Hirshberg, president and CEO of yogurt maker Stonyfield Farm.

For spring, she has some changes up her gauzy sleeve--including more office-oriented wear. Plans call for at least two new stores a year and perhaps a move into sportswear and home furnishings. If all goes well, the biggest challenge will be "not losing our identity as we grow," she says. That may be tough for a company that has made its way by swimming against the mainstream.

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