Abstract
Ron Gottfried talks about his family's apparel business that started in the 1920s. His father, Emil Gottfried saw the need for specially sized dresses for ethnic women, who tended to be shorter and proportioned differently. Before Ron worked for his family's business he had his own college gear business in the 1940s. Ron Gottfried moved around the apparel business over the years, and relates some if the intricacies of running a garment business, from choosing styles to finding factories. He ends by talking about the decline of the industry in the United States and Cleveland, and the move towards Asian made clothing.
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Interviewee
Gottfried, Ron (interviewee)
Interviewer
Frisch, Marc (interviewer); Martin, Sean (interviewer); Smith, Kelsey (interviewer)
Project
Garment Industry
Date
7-3-2012
Document Type
Oral History
Duration
68 minutes
Recommended Citation
"Ron Gottfried Interview, 2012" (2012). Cleveland Regional Oral History Collection. Interview 211002.
https://engagedscholarship.csuohio.edu/crohc000/388
Transcript
Marc Frisch [00:00:01] Yeah, just talk a little bit, Ron. Just say something.
Unknown Speaker [00:00:04] Just say your name.
Ron Gottfried [00:00:05] Oh, Ron Gottfried. Still Ron Godfried. You guys tell me what you want to know ahead of time, maybe that would be- Oh, you preface- Okay, somebody A, B, or I’ll go wild!
Marc Frisch [00:00:23] Today is July 2012, and we’re here with Ron Gottfried, who’s gonna tell us something about his past experiences with his own company, his father’s company, and Bradley, some of the things we had talked about before and probably want to start with your experiences in the apparel industry all the way back now. Take it away, Ron.
Ron Gottfried [00:00:51] Oh, wow, that’s a lot. Well, my father started his business in 1927, the year I was born. He worked for the L.N. Gross Company as a salesman. The L.N. Gross Company at that time made white shirts for office workers. Everybody that worked in an office, every lady that worked in an office had a white, stiff kind of very tailored shirt and a skirt. That was their uniform. They weren’t all the same, but that’s what the L.N. Gross Company sold, those white shirts. And my dad was on the road selling for them. And while he was on the road, he began to notice that a certain clientele section of women were not being serviced with dresses. They were basically ethnic women from middle European countries, of which there were a lot at that time. Germany, Poland, Czechoslovakia, Russia, Italy, everywhere, France. And they were a little bit shorter, they were short waisted, they were fuller, busted, a little narrower in the shoulder, etc., etc. And they really didn’t fit well into the dresses that were made at that time. And you must remember at that time there was no such thing as sportswear. Everybody wore dresses everywhere. And he decided to open up a business making dresses for special sized people at that time, particularly large women. And it began to grow. And one day he went to the movies and he saw Marie Dressler, who was a famous comedienne movie star in the early movies. She was very heavy. And one of her all time commemorative films was called Tugboat Annie with Wallace Beery, who she co-starred with often, who was a gruff, rough and tough, but gentle, large man. And she was wearing one of his dresses. And he wrote to her and she told him that that was the only dress that fit her properly. And she was so thrilled that if he wished to, he could use her name as his label with no cost, which in the day of endorsements today is almost unbelievable. So he renamed his line Marie Dressler and it’s sold throughout the country in major department stores and in small specialty stores. It became a very nice business. He then added to that. He had five sisters, one of which was very petite. And he made a second line called Mynette, M Y N E T T E, which was his sister’s name. And it was also for special-sized ladies. And that mushroomed very well. So between the two lines he had a very nice business. Can I cut it off now at this point? Yeah. I’m trying to think what you want to know next. That’s how my father started this business.
Sean Martin [00:04:39] What was your father’s name?
Ron Gottfried [00:04:40] Emil, E M I L. And he gravitated from Austria when he was 7 years old. And that business went along very well for many years. And it was sold in major department stores to what was then called the daytime dress department, which meant the dresses were basically casual, not really, really fancy dresses, or not really sophisticated dresses. And at that time, department stores were buying on a six months basis. So you could walk into a department store and walk out with orders covering major holidays, Mother’s Day, Christmas, and plan your operation many, many months ahead. And then our salesman, about 15 salesmen that he had covering smaller towns would fill in on a more short-term basis. Shortly after the war, major department stores began to realize that business moves too fast. The apparel industry was beginning to move very fast. People were moving to suburbia. People were changing their habits. The young people coming back from the war certainly weren’t thinking like their parents and their grandparents did. Nobody was living in the same house with their family. And morals changed, mores changed, fashion changed. And the apartment stores realized that they could keep those departments, but they needed to build departments that were more accurate as to the timeliness of fashion, which was moving much faster than six months at a crack. So they set up budget departments. And those budget departments would buy for perhaps two months ahead or a season, maybe three months, and they would get the merchandise in. And if it didn’t sell within X days, they would mark it down if it didn’t sell. So it was a fast moving, changing business. And he was really king of the daytime dress departments. But as labor costs continued to inflate and the cost of fabrics began to inflate, he began to have a tough time making merchandise for those daytime dress departments because the prices were lower. So he moved up into the budget departments. That was a terrific change and it caused him a temporary, tough period.
Marc Frisch [00:07:41] What year was that when things were going?
Ron Gottfried [00:07:44] That was probably in the early ‘50s. I got into the picture. My twin brothers were working for my father, one in sales and one in management, and my brother in Law was representing us in California. My brother-in-law and my sister moved back to Cleveland and he also was a part of the business. I graduated from Ohio state in about 1949 and started an apparel business of my own. I had a very dear friend who was the captain of the Ohio State tennis team, and he lived in Columbus, and he had a nephew there that was the apple of his eye. He was 7 years old, and for his birthday he found a scarlet sweater, size 6, had a gray chenille O made and sewn onto the sweater and gave it to the little boy for his birthday. The little boy had to cross the corner of Ohio State campus in order to go to school. And he reported to his uncle, my friend, that people practically disrobed him and kept asking him if he would sell the sweater or where could they find one. And he told me about it. And I decided that was an opportunity to open a business. So I took my last two years in one year, accelerated, and started a business at the same time. And in 1949, we opened Joe College Junior Company and at $2.50 and $3 for a pullover or a cardigan sweater, we did over a million dollars’ worth of business our first year. And it took off like a rocket ship. We sold almost every major college campus in the United States. And it was unbelievable. The second year we did over $2 million. But at that time, my father begged me to liquidate our business and come over and help him. His number two executive in charge of all production, etc. Who had a lifetime contract, nevertheless decided he wanted to go in business for himself. And he bought another apparel business and gave my father a couple months notice. And my father thought I was more adapt at doing the kind of work that was needed and begged me to liquidate my business and come over and help him. The number two man that left was supposedly irreplaceable. But we found out later that he was really quite disorganized. And my first year there, we turned $100,000 loss into $100,000 profit and sold two factories in the process that he had assimilated in order to deliver properly. Once I realized that he wasn’t the person everybody thought, I told my father he would probably go out of business. And within two years he did. Our business regenerated and everything was going fine. And then my father found out he had cancer and he died when I was, I think, 24 years old. And I took over the head of the business and the business went along fine. We upgraded the look and the sophistication of the product. We were the first major United States company to make double knits. Double-knit product. We bought them from Japan. Even though the American textile industry was beginning to be able to make double knit textiles, they weren’t able to figure out how to dye them. They were made out of polyesters. They started out as wool double knits, which we also introduced. Wool double knits originated mostly in Italy and Britain and people there just loved them long before the United States ever caught on to them. The first year we did them, we made three piece double net chenille suits, Chanel suits. I’m sorry. And I remember our offering price was $23.75 wholesale. Up until that time, the highest price we ever got for anything was a $10.75 dress. So that was a tremendous increase in our price structure and the type of thing we were showing. We had our sales meeting and introduced them to our men and they stuck their tongues out. They, they thought we were crazy. And one of the loudest of them was our Ohio man who was a company man who loved my father before he passed away, was brought into the business by my father, trained and looked upon him as his own father. And he made a terrible stink about it. Two days later he called me from the road to apologize. He said, Ronnie, I didn’t think my little stores could ever buy these. They’re buying more of these than they’re buying of my dresses. And they absolutely flip over them. I am coming into the office tomorrow and I will personally call every salesman and contact them and tell them that I was absolutely nuts and that they have a golden opportunity. And the wool double-knit business for us flourished for many years. Then when polyesters came in, which were much less expensive, we were the first people to buy them from Japan who had learned how to dye them. And we were doing tremendous amount of business in polyester double knits. Of course, maybe within 10 years they began to get footballed around at all kinds of prices as they became more and more popular. I sold my business because basically family situation that wasn’t working well. We bought my brother-in-law out, we bought one of my brothers out. And one brother was left who ran our New York office. And it just seemed to me it was time for me to sell the business. I found a very capable guy who had a very small apparel business in Cleveland. He did about- We were doing about $6 million $250,000 worth of business. He was doing worth of business.
Marc Frisch [00:15:19] You want to mention who that might be?
Ron Gottfried [00:15:21] His name was Jerry Lurie. And we talked and I could see from the line that he showed me that he had a lot of talent, but he didn’t at that point know how to get anything out of it. He had two kind of weird salesmen producing most of his business, but he had talent and it was obvious. And we worked on an arrangement with him that our sales force would carry his line as it was compatible with, but noncompetitive with our line because he made misses’ straight sizes while we were making specialized sizes. So it worked very well. At first our sales force fought me, but within a month they realized they were able to double their business. And they didn’t fight very hard after that. Within two years he was also doing $6 million worth of business with our sales force. And we were still doing our $6 million worth of business. He and I then started a junior line, a younger line, and we called it, let’s see, CM Coventry. CM Coventry was an old joke. CM stood for Corner Mayfield. But everything was English at the time. So CM Coventry sounded great and it went very well. We added another million dollars on and then I sold the business to Jerry at that point, because at this point he had gathered cash and he was capitalized and he, he was running his business very well and he knew how to do it. And I was looking for other arenas to get into and I stayed with him about a year and then I left and he went on to. He may have done $30 million at one time, perhaps, I don’t know. He died quite young and his son Greg took over the business. And he had twin sons also who worked in the business, Kenny and Keith. And that really tells you the story of how my father started the business and how I got involved in the business and how I sold it to Jerry Lurie and how what he did. He also bought Dalton at one point, which I thought was a bad mistake because unlike when I merged with Jerry, we had compatible lines, but non conflicting lines. Dalton was a much more expensive, much more sophisticated line. And I didn’t think the sales force that I had built and knew was capable of going to different stores to sell them. Salesmen always take the line of least resistance. And if they can do enough business selling the stores that they’re comfortable selling, they’re very reluctant to walk into other stores that maybe are four times as- sell clothing four times as expensive. They’re just not comfortable. And if they have a good sale in the next town, they’ll zap to the next town and go to the same stores. They’re used to selling. And I think that hurt them quite a bit and they eventually closed their doors as well.
Sean Martin [00:19:03] You said you noticed that Jerry Lurie had talent. What do you mean by that? What talent and what exactly?
Ron Gottfried [00:19:10] Well, when he showed me his line, he had a small line of garments and I thought they had a nice look, they were priced well. And he just seemed to have a flair in my eyes. His merchandise was very salable and fresh. At one point he was using only woven fabrics. I begged him to get into knits and he resisted and resisted because in his early stages of development with us, he really was afraid to buy fabrics that cost much more. Wovens were a lot less expensive than the knits of the day. So he was very shy, gun shy. But I finally persuaded him and that just rocketed his business.
Marc Frisch [00:20:03] I just want to add that the name of the company that Ron and his father had was Godfrey Dress Company.
Sean Martin [00:20:17] Well, just to follow up on your comments there too, you mentioned then that you left to pursue other-
Ron Gottfried [00:20:22] Yeah, I got into real estate development and God knows what else, tons of things. I ran seven companies for myself or other people along the way.
Sean Martin [00:20:35] That’s completely different from company.
Ron Gottfried [00:20:38] Yeah, I did real estate development. I designed home products in plastics and in metal. I ran a floor resurfacing company for a while, and then I got back into the garment business with the L.N. Gross Company. That’s where my father started years and years ago. They had a very nice. Well, that’s why I think I should tell them they had a very nice sweater business, very inexpensive but good value and nicely styled sweater line. And they, I think, got up perhaps to $8 million at one time. And then they decided to add sportswear, which at that time was all encompassing. Everybody wore sportswear. And the dress business went to hell. And they added sportswear to match their sweaters, which was backwards. How much most people got into the business. Most people were in sportswear and added sweaters as another way to match up their clothing with shirts and jackets and pants and skirts and shorts and T-tops and every kind of thing. And they had a fantastic stylist in New York City who knew the sweater business and was a good designer of sweaters. He also dominated, had a dominating position with all the sweater mills in the New York–Brooklyn area, of which there were tons. And he had a way of getting fabulous values from them. And one day he dropped over dead in the office at maybe 50 years old. And without knowing it, their business changed dramatically that minute. But they- The one party who was president was basically a financial person. The other member of the family was a sales. Was her sales manager and he was good. The third member of the part of the family took over the merchandising and he was absolutely lost. And the fourth member of the family went to work, but didn’t work. He sat and read magazines all day. So they began to look for someone to run their business. And at one point they had a terrible family feud to the point where some were not talking to the others and they couldn’t find anyone that all of them accepted. And then I came along and they all for some dumb reason liked me and accepted me and thought I could help them. So they hired me as a, as an assistant to the president who was doing the merchandising just to see how it would. As a kind of, kind of a way of protecting themselves. And I wasn’t there a week when I realized that they had terrible duplication of executives under them. And they had a man in the New York office who was doing practically no business. He had two assistants. He had all kinds of perks. So we got him out. We closed the New York office who did no business. It cost a fortune. They then had hired a production expert to manage the production because they owned no factories. So they were sending everything out to contractors. And this guy came in from New York. He was supposed to move here, but he didn’t. So he came in every Sunday night and left every Friday afternoon. And they had to pay him transportation and lodging and every other thing. And he had two assistants under him. One to buy fabrics and one to follow up deliveries. And it appeared to me he wasn’t doing any work. And so we got rid of him and turned over the work to the two young guys that were helping him who were terrific. And then we had a problem. They had hired a high powered designer in New York to continue their sweater line. And instead of being a value oriented designer, he was a sophisticated designer and he wanted better merchandise and more stylish merchandise. So actually they changed their business, but they didn’t know it. So I came in and also they had a fit problem. And I brought in one of my ex-pattern people and we found out that their fit was preposterous. That their jackets, they had fit the model to a very full-busted, gorgeous lady with no waist and big boobs. And the jackets kept coming back in droves. They were buying inferior yarns for some of their promotional sweaters. They were coming back faster than we could ship them out. They had never. They showed a nice profit Two years before I got there. But they never wrote off leftover merchandise. They never discounted it or reevaluated for their statements. Unbelievable. They had a huge room full of fabrics. I got ahold of friends of mine at Jo-Ann Fabric stores and they bought everything that was left. They pulled up two full semis and a big truck full of fabric and we cleaned that out. Then we found out they had a 80,000-square-foot building they rented 75,000 was a warehouse, three tiered, air conditioned. And the- You couldn’t see some rows because the leftover merchandise was piled on the third rack so close to the lights, the light couldn’t get through. It took me two years to get rid of all the excess merchandise. And besides what was hanging on the racks, they had boxes and boxes and boxes of sweaters. And we got ahold of a super sweater discounter in North Carolina who lived it was on a big highway and did tremendous amount of business. And we started to sell our off price sweaters to them. And every time we thought we had them cleaned out, we found some more. And we began to think sweaters were procreating in the back on their own because there’s just always more and more. Finally we got them all cleaned out and then the business rolled on and it was doing quite well. And then we bought out the family because the sales manager of the family moved to Washington state and went into the imported flower business. That was Phil Moss and did well. And he moved out of Cleveland for family reasons. And the brother in law who did the merchandising, after he saw what I found out there, he left and moved to Florida. I think in shame, I think he was so. He just felt so badly about that he was not able to do what he should have done. And the third one who was a financial person stayed on. But then we bought him out and we financed that with a friend of our sales manager who was from the east in finance businesses. And at one point he ran into financial problems himself. So we just liquidated the business. I don’t know exactly what year that was, but we just liquidated it.
Marc Frisch [00:30:07] You mean the financial person that you brought in?
Ron Gottfried [00:30:10] Yeah, to help us buy it from the family. He had a conglomerate of maybe 20 companies. And that was when the last big recession was. And he just got hurt to the point where he couldn’t support us anymore. And furthermore, we sold mostly independent retailers, small stores all over the country. We had like 30 salesmen out and. And they began to dry up as the Walmarts and the Other discounters began to settle in one county, and they would kill all the business in the next, the surrounding seven or eight counties, because people would just drive to their stores and they could outprice everybody on everything. And United States went into a discount mode at that point. And I would say we had 3,000 accounts. And all of a sudden we had a thousand accounts because they just went out of business, hand over. They were ma and pa stores, so to speak. Family, second, third generation family stores. It was really a crime because they had a lovely personalized business. But that’s the way it went and still is. And so we just liquidated the business. And I went into other things, actually the production manager who had been left here, my wife will get it. And I opened up. While I was there, I opened up two catalogs, national catalogs, and made specialized merchandise for them. So we decided to open a business structured just to do merchandising for national catalogs. And that was Johnny Appleseed and Tog Shop. And we opened up a small office with just two people, two employees, myself and my partner. And we started out with zero business and $36,000 worth of capitalization. And within three years, we were doing a million dollars worth of business. And we sold some of the best catalogs, five or six of the top catalogs in the United States. And we made specialized sewing projects for Jo-Ann Fabric stores who were buying up other stores and had perhaps 1500 stores over the country. And we were making all the display models for them. And we were just sailing along. And when the Twin Towers got hit, there was a man who lived above our office. He and his wife lived there. They had no children and they lived there. And. And he was a specialist in patterns and markers, which are the long paper patterns that they use before they layer on layer and they pin them on top, and then they cut 100 pieces at a time of each part. It’s mass production. And he had the computerized stuff up there, and they lived up there. And he called us and said, you have to come up and see what happened. And we got there just in time to see the second plane hit the second tower. And I turned to my partner and I said, we’re out of business. And he said, you’re crazy. He said, last year is the best year we ever had, and this year is even better. I said, I’m telling you, we’re out of business. He said, why? And I said, imports have been increasing steadily because people in India, people in Korea, people in Japan, people in Indochina, people in the Manilas [Philippines] have learned how to make, sew properly and make garments and China and their costs and they’re manufacturing textiles over there. They’re hurting our own textile business and the cost of them putting together garments is beating the hell out of us. And we’re gonna, our industry is going to be gone. We’ve held on because we have a great sense of style. Our merchandise sells, we deliver on time, we have good quality, our fit is good. We have a label name so we’re still profitable for them. But they now buy about 50% imports. They’re going to buy 95% imports very soon. He said, why? And I said, because it’s now September. Was it 11th September? Yeah, September 11th. The catalogs are well into the meat of their fall season with the holiday season coming up. No woman is going to buy anything until they’re going to be glued to their television sets until we find out who did this, why it happened, what’s going on, what’s going to happen to us. I saw the same thing happen when John Kennedy was assassinated. The retail business on women’s clothing plummeted and it’s going to happen again. He said, so what? I said, well, how are they going to get rid of this merchandise? They’re going to have to give it away. They’re going to have to heavily discount it. They have to special sales and everything else. And I said, once you do that, you can’t go back. If you’re going to give bargains and value, you got to keep giving bargains and value. And where are they going to get bargains and value overseas, not in the United States. So the United States makers are going to get clobbered. I said I could go and live in Asia for a couple of years and try to find some good people to work with, etc., etc. But I don’t want to at this stage of my life. So he said, well, I think you’re nuts. He said, smart ass, when is it going to happen? I said, four to six months. He said, I don’t believe you, you’re nuts. I said, okay. We closed our doors in February 1st and along the way we also got collaborative. About 40% of our business turned out to be with Jo-Ann Fabric Stores making samples for them. And Jo-Ann Fabric Stores had they were publicly traded, but they had a history of yo-yoing. When times got bad, their business got better. When times got good, people bought their clothes, curtains and bedspreads instead of making them. And they finally got ahold of some financial experts to come in and help them figure out how to make that company steadily profitable, which I think finally they did. And they called us up one day and said, we’re dropping the program of floor samples, showing people what you could do with the fabric, how nice it would look, where to buy, the findings, the buttons, the shoulder pads, the belts, everything to go with it. And I thought it was wrong. I thought that retail is bad, that you just don’t let customers wander into your store. You have to give them some direction. That’s what I felt. And I talked to people heavily into retailing who told me I was absolutely right. But I couldn’t convince them. And they, in one hour, dropped about $400,000 worth of business for us and fired the two girls who ran the program. And actually, the program was good. The problem was the guy who headed the department thought they should be fashion oriented. And he had us making things that were way above the trends that the shoppers that shopped at those stores wanted. And we kept telling him, but he wouldn’t listen. So the program was good, but he ran it badly. And then that was one of the things they sacrificed. So between the two things, we were just put out of business. And that was the end of my apparel business.
Sean Martin [00:39:06] 2002.
Ron Gottfried [00:39:08] Yeah, it was 2002. February 1, 2002.
Sean Martin [00:39:11] So can you say more about that last part of it? When you said that you opened a business structure to do merchandising for national catalogs, the Johnny Appleseed and Tog Shop, what’s that mean exactly? Are you making clothing?
Ron Gottfried [00:39:27] Yeah, I would make sportswear items and dresses. In fact, I sent down two photographs where we were on the cover of some. The ones that were framed that I gave.
Sean Martin [00:39:40] This is the one.
Ron Gottfried [00:39:41] These are the ones? Yeah. Yeah. Those were the covers of- Those were our garments. I made up things I thought were great. Either I showed it to them in person or like Damon’s in California, I would send them out to them because they were happy to take them from me. I didn’t have to go out there. And if they liked them and adopted them, they bought them. If they sold, they reordered them. And we had some wonderful sale ones we had. We had one that wasn’t even on the cover of Draper’s & Damon’s that sold perhaps 8,000 garments on a catalog. And it was. We were really hot. We were good. We had a wonderful business.
Marc Frisch [00:40:29] What were you sewing? I know you were down on West 150th Street, right?
Ron Gottfried [00:40:33] Yeah, we were. Our office was 150th Street. Then we moved to 40th, between Payne and Chester.
Marc Frisch [00:40:43] And where were your garments being put together?
Ron Gottfried [00:40:46] Oh, we had garments sewn in New York State. We had garments sewn in Euclid, Ohio. There was a nice factory. We tried to get factories that were very versatile and flexible. In other words, they could handle small quantities because one of the services we provided was we would fill their reorders. And that’s very important because those were sales. But the reorders come in weird. You know, if you start from size 6 through 20, you could get 0, 12, 2, 22. They aren’t a normal range. And you can’t cut them all together. You need to cut what they call single markers a lot. And some people don’t want to monkey with that. They’re not geared for that. So we had a factory on East 200th Street that was very good. And we were very close to people in New York State, upper New York State, who had 14 factories and very close to my partner. And we had people in Florida making merchandise for us.
Marc Frisch [00:41:54] Okay, so you bring all these goods into Cleveland?
Ron Gottfried [00:41:57] No, we’d have them shipped directly.
Marc Frisch [00:41:59] So he drop-shipped from these individual contractors.
Ron Gottfried [00:42:02] Oh, yeah, yeah, yeah.
Marc Frisch [00:42:05] How’d you control your quality?
Ron Gottfried [00:42:09] Well, our production guy would go visit them once in a while or make them send in samples or we got people who really knew what they were doing. We really did. We had. Our returns were almost nothing.
Sean Martin [00:42:26] So you’ve seen the garment industry in Cleveland, it seems from, really from its heyday to today.
Ron Gottfried [00:42:33] Well, let me- When I got into it, There were over 100 manufacturers in Cleveland, Ohio. We were number two to New York City, [Cincinnati], Dallas, Miami, La, Kansas City, Chicago, Philadelphia took away our business. And I was the last garment manufacturer in Cleveland, if you don’t count that menswear factory that’s on the west side there. Yeah. And they just one by one. We used to have two companies that did embroideries. We had a shoulder pad company, we had a belt company, we had a pleating company. I mean, we had all the sub trades, button companies. You know, we had all the sub trades here for a huge business. The fabric people from New York used to come out constantly because they had 50 people they could go see. And then of course, it ended up we went to New York because there weren’t many left.
Sean Martin [00:43:52] So how do you explain the decline in the industry in Cleveland?
Ron Gottfried [00:44:04] I think that- Let me think about that. Companies go out of business because their sales drop and they can’t. And so why did their sales drop? Many of them just in the second third generations didn’t have the talent to keep going. Others second, third generation didn’t particularly want to be in the garment business, which was a very stressful business. We made four lines a year, and at the end of my career, I was styling those lines myself. And I would finish a line and think, oh, I’ve got something good now. Our salesman will be excited. We can do business for the next three, four months. And two days later, the stress would start again, because I’m starting all over from nothing. And the starting point is to go to New York or where the textile people are, see what they’re presenting, see what appeals to you. And always in light of what your customer might like. You see little fabric swatches this big, and you have to say, I can make a pant out of that, and I can make a sweater that’ll go with it, or I can make a suit out of it, or I can make shirts out of it and tie them all together. And some of those sportswear pictures you saw where there were pants and all kinds of pictures of ladies wearing tops and bottoms that blended with each other, you have to put that all together, and you’re only as good as your last season. And it moves so fast. Even then, it moved very fast. At one point with the Gottfried Company, we went into the unlined suit business, because unlined suits came in right after World War II. People like Maurice Saltzman’s company made junior suits, unlined suits, which brought the prices way down. They were sturdy enough, but they weren’t fully lined, which relieved you of a tremendous labor cost, and they took off like rocket ships. So we got into them for our customer, and we called them Season-Rite suits, and we had a whole business out of that. But within 10 years, no one wanted unlined suits anymore. You could do $2 million on them, and 10 years later, you do zero. Well, you know how the trends move so fast. Sometimes they want pants that are three inches above your ankle, and other times they don’t sell. Then shorts become good, then knit tops become good, then batwing sleeves come in, and I mean, it just moves so fast. It’s unbelievable. But I think basically they lost their way and other people took their business away from them, and that’s why. And then, of course, as the pool drained and the subtrades drained away, the talent drained away. I think so. Don’t you think so, Mike?
Marc Frisch [00:47:38] Yeah.
Ron Gottfried [00:47:39] Yeah.
Marc Frisch [00:47:43] I always said that one of the things about the whole apparel industry is the passion of the person that’s leading it. Once you remove that person-
Ron Gottfried [00:47:53] That’s right.
Marc Frisch [00:47:54] The other people trying to handle the thing, because it’s a passion and a gut passion and a gut drives.
Ron Gottfried [00:48:02] And there was a point there when Bobby Brooks flashed onto the scene. Maurice Saltzman anticipated a marketplace juniors before anyone realized it was there. And he found merchandising salesmen and sales management to fill the bill. And they started to do real well. They got into such a dominant position even with major stores that they would go in and write the order for him, tell them how much to buy if they wanted them in their department. They absolutely dominated. And I once talked to Maury, I said, Maury, your asset is going to be your Achilles heel. And one year, sure as hell, he was wrong. The merchandise was wrong. And at that point, all the stores said, okay, we still want you. You’re good. You know what you’re doing. You had a bad two seasons, but we’re not giving you control of the department anymore. We’re going to buy what we like. And there’s other people now that we’ve excluded, we’re going to try them, too. And their business went down, so that’s how fast things can happen. And other- It’s a very competitive business. Anybody that was a salesman like my dad and decided to go into business, it’s not expensive to get into business into the apparel trades. You don’t need a factory. You need somebody that’ll make merchandise for you. You need a couple customers and a pattern person and put stuff together and you know, and sell it yourself to start with if you have some good contacts.
Sean Martin [00:50:01] It makes it sound so easy.
Ron Gottfried [00:50:03] It’s easy to get into. It’s hard to stay. It’s hard because competition’s very tough and because it moves so fast. And you can see people who get into business and catch a hot trend and they’re good for two years and then they’re out of business and they went wild for two years. Right, Mark? Yeah, it’s exciting. If you’re doing good, it’s like applause. If the stuff sells and you get reorders and the merchants are excited about it and people are calling, can I get your line? There’s a passion, but it’s also a very tough business. Very stressful.
Sean Martin [00:50:49] You said a couple things about the development of sportswear, the switch to sportswear. Can you say more about that? What’s it actually look like in terms of how many people are aware and how and when people made the switch?
Ron Gottfried [00:51:04] Well, I have to tell you a story. When I was on my honeymoon. My wife and I were lucky enough to go to Europe, and we went to Zermatt, Switzerland, early fall, and we looked out the window and there were people skiing down the glacier. I said, boy, that looks like such fun. So on my 30th birthday, we went out to Sun Valley, which was one of two ski areas in the United States, and you had to wear a tuxedo to dinner. We had no skis, no clothes. We didn’t even know. We just got in the train and went out there. And the second night at dinner, we’re sitting there, and in walks Gloria Swanson. I think it was Gloria Swanson with her boyfriend, who was an Italian ski instructor there in a gorgeous glittery top and pants, velvet pants. That is the first woman I ever saw in pants. And the room was whispering, oh, my God. But women wear ski pants, which they had a stretch. They were tight fabrics, and they made women look great. And I remember I came back and I wrote Maurice Saltzman a letter and suggested that he go into ski wear. And he thanked me, but pooh-poohed it. Never did get into it. And it wasn’t even then there then. And then after the war, everyone’s dream was to own their own home. All the GIs came home, hundreds of thousands of them, and they bought houses out in the suburbs. And when you’re out in the suburbs, you’re grilling out and you’re doing. You’re not. You’re raking your lawn and you’re doing. You’re not. It’s formal. So your way of life changed. And then there was a company called Panther, P A N T H E R, out of somewhere in Wisconsin, and they started making pants for women, and they went wild. And then if you have pants, you can’t wear a dress over it. Some people began making shirts and tied in sweaters. And sportswear exploded. It absolutely exploded. And dress business is back somewhat today, but I would still say sportswear’s got to be 70% of it, wouldn’t you think? Because that’s the way we are. I wore a tie the other day, and I almost forgot how to tie it. And, you know, you see guys in business with just jackets and open collar. You see them on TV, some of the anchor guys. It’s just- It’s just an easier way to live. It’s more comfortable. It’s easier to get dressed. I don’t know, it’s just. It represents the way we are. We’re much more casual, less formal people. The whole world’s that way. And there’s so many more things you can do with sportswear. You may have so many different pieces you can put together. And the dress is a dress or maybe it’s got a jacket with it. Jacket. Dresses used to be big. They’re not so big anymore, but two piece dresses, but, you know, and now skirts have come back a lot.
Sean Martin [00:54:48] So then would you say then there’s a motivation for the industry as well?
Ron Gottfried [00:54:52] Sure. The motivation is fashion represents the times. It represents how we live our mores. It represents the way we live, the way we look at things. It represents events like you take the arrival of the Beatles. They change fashion, you know, and different social trends reflect themselves in fashion. Fashion isn’t just something that dictates to the public. Fashion is something that represents the. The way the public is. And the guys who are successful are the ones who interpret that.
Sean Martin [00:55:50] I had a couple other questions. Maybe I need to look up at my notes.
Ron Gottfried [00:55:53] It’s hard for me to, you know. Do you want to hear a funny story?
Sean Martin [00:55:58] Yeah, sure.
Ron Gottfried [00:55:59] Okay. It’s also reflective of the business. There used to be markets, shows at major fashion centers. Chicago, Miami, Kansas City, Louisiana, San Francisco, Dallas, I mean, and some of them, Charlotte, they built huge marts, three and four story marts with 300 rooms. They were all packed and busy and sometimes you had to know somebody to get in there and pay rent. And then they would have the shows like four times a year. And all these smaller stores would come in because it was their chance to go to the big city and look at a lot of lines at one time, see lines they never saw and go to the theater or eat at a good restaurant or something like that. So it was terrific. We had a show in Chicago at an old hotel called the Morrison Hotel. It was like a good second-rate hotel, older, and it was before even air conditioning. And we used to have four salesmen there. Our Illinois salesman, our Michigan salesman, our Iowa, Nebraska, Kansas, whatever, the two from there. And they were quite friendly with each other over the years. And they shared this room. And because we were a good factor and been there a long time, we got a nice corner room on the second floor. And one of the guys had a customer from an outlying area in Detroit, right in the middle of a tremendous amount of ethnic people, all of whom were perfect customers for us, you know. But the buyer was a miserable sob. She just was impossible, overcritical, drove us crazy and used to buy out of a line of maybe 50 garments. She would buy three or four. They go into the store, and she reorder them like crazy. And we always thought, what if she’d buy 10 or 20? You know, our business would double. She had perfect place, and we were a perfect supplier for her. But she wouldn’t. She would criticize every single dress. One day, an order came in from the Chicago show, and it had 23 styles on it. I couldn’t believe it. I called up one of the guys who answered the phone and said, what the hell happened with this store? Why’d you buy 23? He said, Ronnie, unless you were here, you wouldn’t believe the story. He said, remember, we sent out a trainee. If we had a young man that we were going to hire for the sales force, we’d send him out on the road sometimes with one of our veterans, and he would get on site training. So they took this guy and they had a corner, and they opened both windows for ventilation. It was a hot summer day, and they put the line and the table to write the orders right near the window. And they sent the kid, the trainee, down right below him on the sidewalk with a rack. And the lady came in and they greet each other, and they start showing the line on the first garment. She says, well, I don’t like the collar. He said, you’re right. I told him about it and threw it out the window. Next one, well, that skirt out the window. He threw the first six out the window. And he said, you know, you’re right. I’ve told the boss, I don’t understand why he doesn’t listen to you. Finally, wait, wait. That one’s pretty good. She bought 23 of them, and they threw all the rest out the window. What she didn’t know was he’d floated down and the guy would catch him, hang him right back up on the rack. And after she left, he wheeled the rack back up. And I just- I just think that is a. That is a priceless story.
Sean Martin [01:00:05] I think just one last question, really, sort of a structural question. You’ve talked a lot about the sales force. Can you sort of outline the organizational structure of your company in some way?
Ron Gottfried [01:00:22] Yeah. And it was true of almost all companies at that time. They all did most of their business through sales forces. Later on, when the big companies took over the industry and knocked all the little ones out, they didn’t want to buy from salesmen because they realized there’s an 8, 10% commission paid to the salesman. They wanted you to give it to them for promotion or in the price structure, lower the price by 8, 10%. So they wanted you to come to New York with the principals of the company. They didn’t want to buy through a salesperson, even through a showroom. You went to their office and you showed them your line in their office. But at that time, with all the little stores, the salesman either had to go see them or invite them into a show and hope they showed up at the show. And some people, some salesmen wrote tremendous amount of business at the shows. I remember once our Minneapolis show was a wonderful show. We had two or three very successful guys there. And once Jerry and I got mail like this from the Chicago show and we spread it over the floor and danced through. Was so much fun to see all those papers on the floor. But it was necessary if you wanted to see these small stores to have salesmen represent them. And they would scour the bushes, literally scour the bushes. And you could have one or two people in California, you could have a representative in the Rocky Mountain states who would highlight the towns. He couldn’t scour it. You would have someone in the Southwest, you’d have one or two in Texas, you’d have maybe Texas, Oklahoma. Then you’d have Louisiana, Alabama, you’d have a Florida man, you’d have a Georgia. And then the rest of the Virginias and West Virginias and Pennsylvania might have had one and one In New England, they were sectional or by state, where the states had the population. And you could have. If you were a good company, you could have 30, 40 salesmen out. Bobby Brooks at their highlight was so powerful. They had guys covering certain sides of the streets in certain big cities. 120. They had 120 salesman samples of the sale. Don’t tell me it’s raining.
Sean Martin [01:02:52] I. I think it’s starting.
Ron Gottfried [01:02:53] Wow. Can’t believe it.
Sean Martin [01:03:01] This has been a great conversation.
Ron Gottfried [01:03:02] Thank you so much. It’s my pleasure. And when you mention things, a lot of things come to my mind, but it’s been a long time since I’ve been in it, so I forget things.
Marc Frisch [01:03:12] I think your interview has given a lot of depth to things we wanted to know.
Ron Gottfried [01:03:19] Okay.
Marc Frisch [01:03:20] Sean is going to be doing the writing on.
Ron Gottfried [01:03:21] Okay.
Sean Martin [01:03:22] Well, I really feel like it’s a beginning to end sort of. Sort of interview. So it’s great to get that.
Ron Gottfried [01:03:27] You know, if you have questions, just give me a call or something like that. And I certainly.
Sean Martin [01:03:32] Thank you.
Ron Gottfried [01:03:33] I. I can’t tell you a lot about a lot of the other companies except just having viewed what they went through, but I knew a lot of the people and we shared a lot of things. And there were over a hundred solid companies here at one time. Now there are zero, except for the men’s.
Marc Frisch [01:03:57] I gave you the sheet, didn’t I?
Ron Gottfried [01:04:00] Pardon?
Marc Frisch [01:04:00] Did I give you the sheet?
Ron Gottfried [01:04:03] I don’t think so. Oh, yes, you did. Yeah, yeah, yeah.
Marc Frisch [01:04:09] There was a function at the Western Reserve Historical Society recently.
Ron Gottfried [01:04:15] Oh, okay.
Marc Frisch [01:04:17] I gave these out.
Ron Gottfried [01:04:22] So what was that? That was a market.
Marc Frisch [01:04:24] No, you have to turn over.
Ron Gottfried [01:04:26] Oh.
Marc Frisch [01:04:29] I gave you one of these, didn’t I?
Ron Gottfried [01:04:32] Oh, okay. Not only did the garment trade disappear, but the textile trade disappeared as well. That’s pathetic.
Sean Martin [01:04:41] Well, it really is quite a story.
Ron Gottfried [01:04:43] In the rise and fall of an industry. Yeah, we just became non competitive. Happened to the shoe business, it happened to the electronic business. Happened to a lot of businesses. There’s just nothing. There’s a few sewing factories around. That’s about all.
Sean Martin [01:05:05] Well, and it is interesting to me what you say about.
Ron Gottfried [01:05:09] Well, about the individual and talent, really, and the competition. The price structure killed us. These people in New York State owned 14 factories. They had over 1,000 employees. They just decided to close them up. That puts a lot of people out of work. Yeah. And nothing’s replaced it. Yeah.
Marc Frisch [01:05:39] So we have a story to tell.
Ron Gottfried [01:05:40] We do. It is a story. And it’s one that’s parallel in other industries, but it’s. It went fast. They started out first trying to do it in Puerto Rico. And the people, when they cut all these individual pieces, like 100 collars at one time and 100 sleeves at one time and 100 right busts at one time. Shirt fronts, they have to be put together with the right one because over the course of the fabric, even in one boat, they can shade a little bit. And if you put the collar from the upper level with this piece from the bottom, they might look like they’re two toads. So you bundle them all and you have little numbers and tickets on them to put them together. And they first started going to Puerto Rico and places like that. And the people couldn’t read or didn’t know numbers. So they just destroyed the merchandise and they gave up. But over the years, they found good ways to teach people to do them. And modern machinery has improved so much over the old sewing equipment. And they have good techniques now. And they can teach people who maybe are crafted like a lot of Asian people, learn to knit or crochet or whatever, or sew, hand sew. And those people just understand it. So you can build factories quickly. And I’ve even watched the Asian countries. It’s going from one place to the other. As one place starts to hire a lot of people, then the wages go up. So then they move it to the next country and they’re able to do it. And like they started, Taiwan was one of the first ones. Right. And now China’s got it all. You could keep moving in China for probably 20 years before you exhaust all those places.
Marc Frisch [01:07:43] China’s been going to Vietnam.
Ron Gottfried [01:07:45] Oh, now they’re going to Vietnam. Yeah. It just keeps moving around. We’re in a world economy, and that place that can do it most efficiently and most ably ends up with it. And then when someone else shows they can do better, it’s gone in a month.
Marc Frisch [01:08:02] You know, one of the things that a lot of people said to me about imports. Oh, they don’t fit well. And I said, you know, it depends upon the manufacturer because of his specifications.
Ron Gottfried [01:08:16] Right, right, right.
Marc Frisch [01:08:17] Because they, they abide by the specifications. And so it really isn’t necessarily the country or the place, it’s the manufacturer that follow through.
Ron Gottfried [01:08:27] Right. That’s how good people run their business. Right. You take someone like Ralph Lauren, big name, he can’t afford to have poor merchandise. He manufactures all over the world and probably very little here. Pardon?
Marc Frisch [01:08:48] They follow his specifications.
Ron Gottfried [01:08:50] Sure.
Marc Frisch [01:08:56] We need to take your picture.
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