Episode 20: Beyond Competition: How Peer Networks Are Bolstering Independent Retail
Welcome to another episode of Main Street Matters, Terresa Zimmerman speaks with Fred Derring, a true champion of Main Street and principal of DLS Apparel Group. With over 40 years of experience working exclusively with independent retailers across the United States, Fred shares invaluable insights about the power of community in the independent retail space.
Fred Derring has been in the retail industry since college, working his way up through independent stores, department stores, and consulting before founding DLS Apparel Group. His passion for both products and people has driven his mission to support independent retailers across America.
Episode Highlights:
-DLS helps independent retailers gain collective buying power while maintaining their unique identity.
-Members share best practices in a non-competitive environment, visiting each other's stores to learn.
-One retailer generated $500K in wholesale through an innovative graduation suit program.
-Independent stores saw growth after COVID as shoppers discovered personalized shopping experiences.
-Beyond merchandise, DLS provides marketing tools, digital support, and e-commerce guidance and best practice.
-Getting customers in the door remains the biggest challenge for independent retailers.
-DLS is expanding into coffee table books and complementary accessories and categories.
Featured in this episode:
About DLS Apparel Group:
DLS Apparel Group works exclusively with independent retailers, across the US, but most of their clients are eastward. Based in NY, they also go from the West Coast to St. Louis, Chicago, and Dallas. They scout products domestically and internationally, host buying meetings, and provide comprehensive support services to help independent stores thrive.
Menswear Retailers Premier Buying Office
130 W. 57th St., Ste 5C
New York, NY 10019
Office 212.399.0750
Fred 917.699.1157
Virginia 917.509.6053
John 917.545.6887
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Host - Terresa Zimmerman:
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Full Transcript
Fred Derring:
The stores, since COVID, have really grown a lot in volume because they got nervous with going to the big stores because of the disease. And they started shopping in small stores and found out how much they loved it in terms of the treatment that they got, like your business.
Terresa Zimmerman:
This episode of Main Street Matters is brought to you by Wood Underwear, Marquesi Jin Frati Neckwear, and Inspiro Tequila. I'm your host, Terresa Zimmerman.
SPEAKER_01:
Welcome to Main Street Matters. As you know, we love to find partners and champions of Main Street, our independent retail stores across the United States, and we have a real treat here today, a true champion of Main Street, Fred Dering, Principal of DLS Apparel Group. Welcome, Fred. Thank you for joining us today. I'm gonna ask you to just dive right in and tell us about DLS Apparel Group.
Fred Derring:
Yeah, first of all, we've been doing this about 40 years, working with independents all the way around the country from here in the West Coast. Most of our clients are, we took a line, we do it from here to St. Louis, Chicago down to Dallas. Most of our clients are eastward, a few in the West. And we've been doing this a long time. And I guess the big thing with our company is we love product, we love people, The combination of the two of those together makes a really nice romance out there. We also get to travel to Italy a lot and see product there that we bring back to our stores and introduce them to that product. I guess one of the reasons that we really exist is independent stores, generally the owner is the buyer. And they don't have time to shop like we do. And that's all we do is shop all the brands across the country. And we travel across the country and overseas to Europe, looking for these brands and meeting these people, which we've done forever. And then we have a series of meetings. And before COVID, We used to have three meetings a year, New York, Chicago, and Las Vegas. We stopped going to Las Vegas quite some time ago. And New York, since COVID, has never recovered to have that big show that they used to have. So there's a lot of little small shows. But very important in New York has become the independent offices that carry anywhere from 8 to 12 brands, and most of them from Europe, rather than domestic or made in Asia somewhere. So it's a delight to work with those people because you see really interesting product. So after we put all that together in a, I guess in a 90 day period, then we get ready to go to Chicago to make a presentation to our group. I would say that close to 90% of our clients go to Chicago. So it's a big show for us. Chicago has been a delightful town. I used to live there for five or six years, years ago, doing retail. And I don't know, we just, we really like product. And that's what drives our ambition to work with these stores. My wife always says, you could go in a grocery store and be happy. And that's absolutely true. You know, we'll go out to the beach sometimes and we'll stop at this store called Giuseppe's, which is a big Italian grocery store. And we'll have our two dogs with us. And my wife, she'll say, OK, you got 20 minutes. That's it.
SPEAKER_01:
And she puts you on a timer to shop. That's great.
Fred Derring:
Yeah. So anyway, we just really enjoy product. And we're lucky that We love product and we have people here, Virginia, who's been with me from the beginning. And John Titolis, who you've talked to, came to us from Vardis. So we have a great team here. And so it really comes down to the product and the people. And that's what makes everything work for us.
SPEAKER_01:
Yeah.
Fred Derring:
which was to see our clients more, because when we used to see them three times, it was delightful. And not that you see everyone three times, but you got a chance to see them a couple of times. And now it's just once a year. So kind of disappointed in that. So we're sort of keeping our fingers crossed that somehow New York reinvents itself when it comes back. So we'll just keep praying for that to happen. But there's a lot of shopping that we do. And the market is split up somewhat different now. They're having early market, which they never had before. That mostly comes from the Italian side of the ocean for us. So guys come in now over two months, where they used to come in for that 10 or 12 days and do a lot of shopping. It's kind of hard to gather people together to make that happen and see everybody again. So it's just Chicago. And thank God Chicago is so good and so easy to work and such an easy town to live in. Because you really don't have to take the cab to come there. You can be in a hotel, you can walk there, you can walk to the restaurants. And my southern guys are the only ones that complain about the weather in February.
SPEAKER_01:
I mean, Chicago in February is a little tough. Come on, even you have to admit that sometimes.
Fred Derring:
When I lived there, it was in the 60s, and I was sort of a young dude with a beard and smoked a little cannabis at the time. When I got up to go to work in the morning, if you didn't really dry your hair and your beard, you had to take the subway downtown. and it would freeze. And by the time we got to work, we looked horrible. Oh my gosh. And I loved being back there.
SPEAKER_01:
Well, unlike when you're saying you grew up, now cannabis is legal in Chicago. So you're probably on the edge there. So to be clear, when you say clients and customers, you're talking about the stores, the men's specialty stores, the independent stores that you're serving. And getting together, it's these meetings that you have at these, well, now Chicago, right? And so aside from doing kind of the homework around shopping for them, I know there's more services that you provide these members. Yeah, you wanna talk a little bit about that?
Fred Derring:
Well, I think the biggest thing that we tried to do But almost from the beginning is introduce new ideas to help run your store. And sometimes, what was the big machine that we all had before the computer? The tele, what was it called? The telegraph, tele?
SPEAKER_01:
Well, there was a fax machine and a telex and a typewriter. It was a tele. Oh, okay.
Fred Derring:
We even tried to put a theater together for us and for our store, and it didn't work out. And then the fax machine came along and then the computer. So today it's the phone, the computer. The fax we actually got rid of, believe it or not, two years ago. But we tried to help them integrate all the new things, control their inventory, they're open to buy. open to sell all that together. And then obviously the next step would be selling online. So now a lot of people have used Shopify, which is a good one, and we use Shopify. So a lot of our stores are now selling online, which is great. And some manufacturers have even drop-shipped where you don't have to actually own the inventory and show pictures of it and just drop it to the customer. So we do a lot of that. We do a color ad log. We do a flip book, which is electronic that they can send out to all their customers on their emails or any social media thing that they have. And that turns out to be great. I think you've been in it a couple of times as well. So it's a nice thing to open up a season with. You can use it at Christmas time, Easter, or any time that you want. Talk about great events that you have in the store with your customers and your vendors. We do a lot of custom work in our stores. So we have trunk shows and use these to introduce those trunk shows. So we try and bring anything and everything that's out there to the retailer so they can find out about these vehicles they can use. And everybody calls us, fortunately, in the industry to talk about those things for our clients. So we introduced that as well. So I mean, the clothing and getting to know the clients and their children and all this is really great. And one of the nice things about the meeting is many of the guys have become close friends over the years, and they share a lot of things with each other, which is terrific. And they go to dinner together. They even become friends with their families together, which is really terrific. Yeah. So all in all, it worked really well for everybody. So it's really happy to be with them.
SPEAKER_01:
Yeah. Yeah. How did you get into this? How long have you been doing this?
Fred Derring:
Do I have to really tell you?
SPEAKER_01:
Well, tell me when you saw the need to actually put this group together. Why did you decide that there was a need for this?
Fred Derring:
Well, I guess when I got out of college, I went to work for a clothing store called Alexander Beagle in Virginia Beach. And it was, at that time, probably one of the best stores in the South, and they carried all the really great brands. And I grew up loving clothes that I got, actually, from my dad and my brother. So I went to work there, and I really liked the atmosphere and always loved apparel. So from there, it became a stepping stone working for other independents. And then I graduated to the problem store. There was Garfinkel and Company in Washington, D.C., who I worked with for a couple of years. And then they transferred me to a store in New York called Depenna. Now I'm really telling my age here, which I don't mean to, but Depenna was a store all by itself, long gone out of business, but it was on 52nd and 5th Avenue. And back then people signed leases and they had a 99-year lease. And when I joined them, wasn't that wow, right? I see that wow. I never knew a lease existed like that, but that's what happened years ago. So anyway, after two years, their lease was up after I joined them and they decided to close. And so I had to have a job, so I went to Bloomingdale and interviewed for their 59 shop, which was their first venture into the young men's arena. And I got accepted, which I was surprised and shocked at, but I decided at the end not to take it.
SPEAKER_01:
Oh, okay.
Fred Derring:
because the president of Garfinkels, and they owned Brooks Brothers at the time. I did go to Brooks Brothers and go through some enemies, but it was a little stuffy for me. Turned that down as well. But they acquired a company in Knoxville, Tennessee called Miller's, which was a local department store. that had six or seven branches with Knoxville as the main store. So the president of the company flew me down there to take a look. And I guess it kind of blew my head up. So I took that job. And so two or three years. And then a friend of mine got hired by a consulting company. called Jaeger Corporation. Long out of business now, but he was a turnaround specialist working with stores that had financial difficulty. I went to work for him, I guess almost for 10 years and learned how there was a huge all price market that you could dabble in and do business with from all the same brands that you've been buying from forever. I worked for him for about 10 years and learned a lot. And one of the things I thought about was, I still stayed in touch with a lot of end-of-time stewards because of who I worked for. And I got the idea with a couple of other people, why don't we open up, I don't know what we thought we were, but a consulting office, buying office. And we said, why can't we do the same things for the independents that I was able to do with this company? And it was putting the buying power together. So we started originally with five to 10 stores, I think, and grew to 25 rather quickly. And so we did what we've been doing for the last 40 years, almost, is finding merchandise and trying to get it for our stores to put it in their stores. In the beginning, it was a real hard push to make the price really great. And then we saw the market sort of shifting and changing where it was really having the right product in the store, not worry about the cost. So we switched what we were doing to a combination of price deals to increase the margins, but to have the right brands and ideas in their stores. And that's where we've spent the last 20 some years. And that's how we built the business people heard about us. So most of our clients come from the outside that get recommended to us through vendors or through our own stores. And that's how we've grown over the years. And we continue to grow thank goodness. That answers your question.
SPEAKER_01:
No, it does, for sure. I mean, buying power and the consolidation of that, that's a big deal. And I'm sure that that's a big attraction.
Fred Derring:
But the attraction for me, and particularly when I'm talking to a new client, they hear about the so-called deals that we get in the market. And when a client approaches us, well, who do you have a deal with and how much? I say, look, we're just joining for off price, don't join. We're going to bring you the best in the market and the best ideas. And the off price is just part of the advice. If you're here for off price, don't come.
SPEAKER_01:
Yeah, that makes sense.
Fred Derring:
That's how we try to attract our client base.
SPEAKER_01:
Yeah. So why do your members stay? What do you think the, you know, top reason or reasons are that your members, you know, keep, you know, re-upling with you year after year after year?
Fred Derring:
We do a rather good job bringing Dreamers to the stores. They don't have to be here. They certainly move the pace level, but don't have the time. Okay. So I think that's kind of one of the big reasons. The other reason is they're able to meet with other retailers around the country that are not competitors and talk about what they do.
SPEAKER_01:
Yeah.
Fred Derring:
And in some cases, they have spun it off little groups and they go to these stores and meet six or seven or 10 stores and look at what that guy's doing.
Terresa Zimmerman:
That's great.
Fred Derring:
So they get a feeling for how he or she runs their operation. And I think that's a big asset for everybody.
SPEAKER_01:
Yeah, that best practice sharing is great. And you guys probably get them up in your meetings to present to the whole group too sometimes, huh?
Fred Derring:
Well, yeah. Anything that they're doing that really has an initiative that I think is workable.
SPEAKER_01:
Yeah.
Fred Derring:
We have one client, Harper's in State College, PA, who's, because of the school, who does uniforms for the graduating seniors for job interviews. and the uniform meets a suit, a shirt, and a tie, and does huge business of it. So I talked to my other clients about it, where they are, and I get surprised when I find out they're in a college town, but they're not talking to people. And I said, well, here's a guy that does a half million dollars of wholesale.
SPEAKER_01:
Right. Wow. Yeah.
Fred Derring:
And besides having the student there to wear his first uniform to go get a job, his parents come to town during those football days.
SPEAKER_01:
Yeah.
Fred Derring:
Where'd they go? Because you're a store to shop because your son's shopping. Okay, so it's all that kind of stuff that we try to hand to the guys. And I just had two this past week that I talked to. And because one of them sent me a shot of a kid when you just put it in a suit. And I said, it looks great. I said, well, how many of these do you do? Well, occasionally I get one and I talk to him. He got all excited. He called Brian at Harper's and now I think he's been trying to do the same thing. So we're learning as they're learning. So it's really terrific.
SPEAKER_01:
Yeah, no, that's great. And I think they actually love to share knowledge, you know, amongst themselves, because they're, you know, as an entrepreneur, as a small business owner, independent business owner, maybe not even small, you don't have a lot of peers to, you know, talk to kind of in your local area, right? So, you know, having a place to go, you guys as a source for, you know, those peers and the shows, of course, I mean, that's a big benefit.
Fred Derring:
Well, the problem with someone local, if he's local, he's a competitor. Right. And we only have one or two situations like that in the whole office, because usually we won't sign more than one trade report.
SPEAKER_01:
Got it.
Fred Derring:
In an area in which they give us permission.
SPEAKER_01:
Yeah.
Fred Derring:
So we have a couple of those, but they've worked out okay, because if we get that kind of reference coming to us, we call the store that we work with in that area and say, do you mind? Yeah. You can bring this person into the group. So far it's worked out fine, but we don't necessarily do that, because once you tell somebody that you're working the bags, It's community, it's for the better.
SPEAKER_01:
Yeah. Yeah. You manage out the conflict already.
Fred Derring:
We try to keep one line in the trade there.
SPEAKER_01:
What are their biggest challenges that you see? I mean, you have a good view across the United States and some of Europe, too, about what independent retail is facing. Do you see some big challenges upcoming?
Fred Derring:
Well, I think the biggest challenge is getting customers into your store. So we're always looking for ways to reach out to that customer to get into the store and making part of your community. So I think that's always the biggest challenge, getting in to start the shop with you rather than someone else in that community. So we're always looking for ideas of how to reach out and how to show the client what you have in your store. And we're always assuming And stores since COVID have really grown a lot in volume because they got nervous with going to the big stores because of the disease. And they started shopping in small stores and found out how much they loved it in terms of the treatment that they got, like your business, okay? Because that's what you're about.
SPEAKER_01:
Relationships, people, yep.
Fred Derring:
Yeah. So the challenge is getting customers into your building. I think once they're in the door, they get treated so well. They like shop and plug that.
SPEAKER_01:
Yeah.
Fred Derring:
That's the biggest challenge, I think, for all of them.
SPEAKER_01:
Yeah. And then I mean, I know to that end, I've spoken with a number of your members just incidentally, because I think we work in the same communities, but they're all working on SEO. You've got them out there doing search, trying to draw traffic in physically to their store by using digital means. I know you guys are doing a bunch of stuff like that.
Terresa Zimmerman:
Sure.
SPEAKER_01:
Yeah. And you bring in experts to help them with that or refer?
Fred Derring:
John is more versed in that with his background than I am, but we try and bring in people that know what they're doing that can talk to the clients and convince them that they should be involved in this method in some way to be able to understand what's going on in their business.
SPEAKER_01:
Yeah. Yeah. If somebody wants to know more about DLS Apparel Group, what's the best way to reach out to you guys or contact you guys?
Fred Derring:
have to look at what we're all about with the phone number and email, so they can call us or reach out to us or send us an email and we'll chat with them. And in a lot of cases, they'll know the retailers that we work with, so we'll say, call, talk to them. The other thing we don't do is we don't ask for a soundtrack, because we really believe you're not happy. you should move on and not feel like you're locked inside. We asked for a three-month payment up front, maybe because I've had some people that joined, just to look at the list. That's not fair. We asked for three months in advance and then we billed monthly after that. And if you're not happy, you should just call up and say, you know, it's not working for me. Some people don't put the effort in. OK, I think all of them, they put the effort in that really something good from our all. We've been around too long. We've been doing this too long, but we're not we wouldn't be here if we weren't doing good things.
SPEAKER_01:
Right. Well, I looked at your member list on your website, and I know that a lot of those guys have been with you a long time.
Fred Derring:
Oh, yeah.
SPEAKER_01:
Yeah. Pretty good.
Fred Derring:
I've been here from the beginning of our office.
SPEAKER_01:
Wow. That's incredible. That says a lot. It says a lot. So I have one question to end, but before I ask you that question, is there anything else that you'd like to cover off? Anything that somebody should know that we haven't talked about?
Fred Derring:
We do a felder paper catalog for the guys, and we do the flip book, which is for electronic use. We do that for each season.
SPEAKER_01:
You do that for each store, right? So that's why you do each store.
Fred Derring:
Yeah, each store has to decide they want to do it. We don't make them do it. It's available, and we say it's available. Would you like to do it? And then we go from there. But they tell us, we send them a piece of paper with all these brands on it. And we ask, mark the ones that you'd like to have in your book. And if we miss their brand, on the back page, put their brand in. So once we have all their brands, we go to them. and to the brand and say, we'd like a nice ad from this store that you're doing business with. And then Karen Allberg, as you know, Karen, has written several articles for us about sustainability, about custom, and we put those also inserted in so they can talk about those kind of things in their store, which are important today.
SPEAKER_01:
Karen Allberg of MR Magazine, yep. Yeah, we'll put all the links that you mentioned in our show notes as well, so people have access to those through our show notes. And then, yeah, so my final question for you, Fred, is why does Main Street matter? And you know, when I say Main Street, I'm talking about independent retail stores.
Fred Derring:
When someone like you can interview all the different hotels around, and they'll pick up the feeling of what those guys or women are doing, and it'll help them in their business. I mean, that's what I think you're all about.
SPEAKER_01:
Yeah. Well, and then those independent retail stores, why are they important?
Fred Derring:
Because independent stores have been the backbone of this country forever. Okay? I mean, forever. So they should be here forever, and we're trying to help them survive. There's no reason that each community, and we've lost lots of stores over the years, and it was because of the big stores coming in, the discount stores and all that, but there's room for us. independence. And usually the independent people are the local people that live in the community and they support the community. So it's also helping with that story, which is really great. So independents belong here because they're part of the community.
SPEAKER_01:
Yeah. Love it. Agree completely. Yeah. That's why I'm doing what I'm doing.
Fred Derring:
Yes. Yeah, but you're the strongest of all. You are because you came with no experience and decided this is what you wanted to do. And you did it. You made it happen for yourself.
SPEAKER_01:
Oh my gosh. Yeah, well, I'll tell you just a little story. I mean, you and Lee, Lee Leonard, God bless, God rest his soul. brought me in and just put your arms around me and embrace me into this community 13 years ago now. And that was just a beautiful start to, you know, this journey that I've been on. So thank you for that. All right. Well, thank now that I'm here, I mean, it's not a good show unless I'm crying. So, you know, hey, I appreciate you being on Fred. Thank you so much.
Fred Derring:
When you told me you're a new direction, I felt like we should chat for a minute.
SPEAKER_01:
Thank you. I appreciate it.
Fred Derring:
But we do besides, because we have talked a lot about clothing. The other thing we do is all kinds of grooming products, all kinds of accessories and all kinds of younger sportswear.
SPEAKER_01:
Yeah.
Fred Derring:
Which is important for these stores. It's the one thing that I've always said is that you don't have to just sell clothing. The other thing I'd love right now, and we've done a bad job of making it happen, but I'm in love with coffee table books.
SPEAKER_01:
Yeah.
Fred Derring:
I'm in love with those. And stores could do some really fantastic job. Virginia and I used to have a gourmet fruit shop together, and we used to sell cookbooks like crazy. And you can go to the book companies, and they're very easy to do business with. A lot of times they'll swap everything out for you. But that's a huge piece because of what these stores are missing. And we've done a bad job of making it happen for them, but that's going to be a big push for us in August.
SPEAKER_01:
Oh, cool. Okay. I'll look forward to seeing some results out of that. That's great.
Fred Derring:
Comfy table books are fantastic.
SPEAKER_01:
Yeah, well, you guys are really helping these stores outfit all of their categories. I mean, I know that you cover most of them anyway, but you know, all the accessories that you're adding, that's great.
Fred Derring:
Yeah, no, and it's fun.
SPEAKER_01:
Yeah, we gotta have fun.
Fred Derring:
When we got the book market, I always walked away with a half a dozen books.
SPEAKER_01:
Yeah.
Fred Derring:
I just love looking at stuff.
SPEAKER_01:
I know, I drag around books. They're not exactly easy to drag around, but they're hard to get rid of once you accumulate them.
Fred Derring:
Yeah.
SPEAKER_01:
Yeah.
Fred Derring:
I have them all over in my house.
SPEAKER_01:
Yeah.
Fred Derring:
They're just great to look at.
SPEAKER_01:
Yeah. Agreed. Agreed. All right. Well, thank you so much, Fred. I appreciate having you on. Thank you. And I'm sure we'll be in touch soon.
Fred Derring:
All right. Thank you so much.
Terresa Zimmerman:
Thank you for tuning in to Main Street Matters. I hope you found today's episode insightful and inspiring. I'd love it if you would share Main Street Matters with fellow retail owners or anyone else who loves Main Street. And please subscribe so you know when the next episode drops.
