1. d e s t i n a t i o n s o h o . c o mFEBRUARY 2001 | SBC
PHOTOS BY ROB KASSABIAN
BY AMY H. BLANKSTEIN

2. FEBRUARY 2001 | SBC d e s t i n a t i o n s o h o . c o m
ost Manhattanites won’t cross the Brooklyn Bridge without a good
reason, but Smith Street, located in the Brooklyn neighborhood of
Carroll Gardens, has become a destination for the island’s adven-
turers. They are lured by a rapidly multiplying number of restau-
rants and retail shops that mix style with a homegrown-neighborhood feel. For
Stacy Johnson, owner of Stacia New York, the foot traffic is proof positive that
the career chances she’s taken have paid off.
Just over two years ago, Johnson left her job as a design assistant at women’s
clothing designer Cynthia Rowley to open her own clothing line and retail shop.
An army of young designers tries to make it in New York City every year, and
many fail. But Johnson knows her stuff — not just the art of good design, but
the craft of running a retail business. Using lessons learned at the Parsons School
STACY JOHNSON HAS
A CUTTING-EDGE
WEB SITE,
A PATCHWORK
BACK-END,
AND DESIGNS ON A
NATIONAL FOLLOWING
A SHOP
GROWS IN
BROOKLYN
M

3. of Design and in the field working for
the likes of J.Crew, Calvin Klein, and
Rowley, Johnson has steadily developed
her business, attracting a local and
national following along the way.
These days, the message to busi-
nesses of all stripes and sizes is that
unless they’re outfitted from head to
toe in the latest technology, they’ll
lose the competition. But Johnson
doesn’t have an unlimited budget or
limitless staff to implement cus-
tomized, integrated technology solu-
tions — she does what she can. She has
a state-of-the-art e-commerce site, but
relies on off-the-shelf programs to
keep track of accounting and inven-
tory. Despite this patchwork approach,
but company revenues grew 75 percent
in the past year alone.
LOCATION, LOCATION,
LOCATION
When some designers start out, they
concentrate on manufacturing a cloth-
ing line and hope retail outlets will
pick up their designs. Others open
their own retail stores and risk a lease
commitment in order to create a direct
relationship with customers and the
immediate feedback that relationship
affords.“The problem with manufac-
turing is that when you produce a
collection — say a dress in sizes 8 to 18
in a variety of colors — you don’t
know what’s going to sell,”says Leonard
Bess, full-time faculty member at the
Fashion Institute of Technology in
New York City. “You have to wait for
the retailer to get back to you with that
information. In your own shop, you get
a hands-on sense of what’s moving, day
by day. There’s a great advantage to
doing business in this way.” If, of
course, one can find an affordable
space available in a location that draws
enough crowds to pay the rent, as
Johnson did.
Smith Street hasn’t always enjoyed
fortune’s favors. Once a bustling main
street in a predominantly Italian neigh-
borhood, it suffered from the aftermath
of blackouts, riots, and city neglect, like
much of New York City in the 1970s
and 80s. But after the city finished a
renovation of the corridor in 1996, the
economic landscape began to change.
Restaurateurs and retailers slowly
began to move in, attracted by low
rents, proximity to the subway, and sur-
rounding neighborhoods filling with
young professionals.
“When I first opened, sometimes I
wouldn’t see a soul during the day,”
Johnson says.“Now traffic has picked
up, especially on weekends when every-
body is roaming the neighborhood,
having brunch at the restaurants, and
then stopping in.”
Now Johnson is already experienc-
ing growing pains. “I need to hire
more sewers and cutters to keep up
with the demand, but I can’t hire any
more employees because I don’t have
anywhere to put them,” Johnson says.
“My girls work 40 hours a week and
I’m constantly recutting pieces that I
sold over the weekend.”As soon as she
finds a bigger production space in the
neighborhood, Johnson plans to use
her current studio space for immedi-
ate alterations and inventory storage.
The atmosphere in the shop evokes
the sense of hanging out at a friend’s
house to borrow clothes. Johnson’s
sweaters and knits lay folded on top of
desks, low tables, and a vintage sewing
station. Shirts, pants, and dresses hang
from wrought iron racks in the center
of the store. Vintage photos of family
members and an old Brooklyn school
dot exposed brick walls. While John-
[ a shop grows in brooklyn ]
d e s t i n a t i o n s o h o . c o mFEBRUARY 2001 | SBC

4. son works on new designs at the long
wooden cutting table at the back of the
store, retail assistant Tamara Bechara
helps shoppers by putting together
outfits and offering advice and opin-
ions. In the shop’s adjacent studio
space, the cutters and sewers scramble
to assemble items that sold out over the
last several days.
When Johnson or Bechara ring up a
customer in the shop, they do it by
hand. What happens next to that sales
information can be best described as a
hybrid approach: part shoebox, part
outsource. Johnson collects the hand-
written sales receipts and manually
records the information each week.
She sends the information to her
accountant, who inputs it into an off-
the-shelf Quickbooks program on a bi-
monthly basis.“We’d like to get it to a
point where the sale just goes right into
the computer, but we’re not quite there
yet,” Johnson explains.
Time-strapped businesses often out-
source accounting tasks, and Johnson
didn’t have to go very far afield. Janet
Johnson plays a dual role as Stacia New
York’s accountant and the owner’s
mother. She handles these duties in
between doing the books for Johnson’s
Tire Service, the four-location business
she owns with her husband in Alaska.
ON THE CUTTING EDGE
Johnson doesn’t rely on foot traffic
alone to keep her boutique in business,
however.Vintage furniture and a near-
manual accounting system may rule
the shop, but Johnson took to the
Internet almost immediately. Like a
handful of young designers, she’s using
her Web site, www.stacianewyork.com,
to market and sell her designs to an
audience far beyond Smith Street. The
site debuted in July 1999.
“It’s an inexpensive way for me to
extend my brand outside of the New
York area until I can afford to open up
other stores,” Johnson says. “I’m pri-
marily a retailer and a manufacturer —
I’m not interested in doing wholesale.
Until I can open other Stacia New
York stores, the Web site is my only way
of reaching those people.”
FIT’s Bess believes smaller compa-
nies have the most to gain from using
the Web as a marketing medium. In
the past, a green designer’s best hope
was to catch the eye of the fashion
press to catapult them into the pub-
lic’s conscious — the cost of tradi-
tional advertising was prohibitive. The
Web is far cheaper.
“You won’t find small designers
advertising in magazines or catalogs,
but they can reach a large market
through the Internet,”Bess says.“They
can manage that within their budget.
It’s just a matter of setting up the Web
site and paying a hosting fee. I liken it
to guerrilla or grassroots marketing.
They’re bypassing the traditional meth-
ods in order to get their message out
into the market.”
In addition to posting photos and
descriptions of her pieces, Johnson
includes information on the store, a
brief biography, and press clippings.
The site also generates some press
coverage, which is an unexpected
bonus. Johnson also includes a link to
her e-mail address so she can field cus-
tomer inquiries.
Although the site’s primary job
is to drive attention to the Stacia
New York brand, it pays for itself.
Stacianewyork.com included a shop-
ping cart from the beginning, and
brings in approximately 2 percent of
Johnson’s annual earnings. “I am
breaking even,” Johnson says. “I’m
not spending millions to produce it,
nor am I making millions. Whatever
I spend, I make back.”
Johnson updates the site several
times a year. She makes major revisions
when she launches her spring/summer
and fall/winter lines, and then makes
minor adjustments when she
announces a sale or updates press clip-
pings.Sweden Unlimited,a Manhattan-
based Web design firm whose clients
include other fledgling clothing design-
ers such as BuiltbyWendy and Pixie
Yates, designs and updates the site.
Johnson has also taken advantage of
customer suggestions to make changes.
Johnson uses many unique fabrics,
but customers complained that the
images of fabric swatches on the site
were too small.With this fall’s redesign,
Sweden Unlimited added a zoom fea-
ture so customers can really see the col-
ors and textures.
For her next update, Johnson hopes
to add an e-mail service to the site so
clients can get opinions from friends
and family on their picks or alert them
to items with strong gift potential.
FEBRUARY 2001 | SBC d e s t i n a t i o n s o h o . c o m

5. Clients could send an e-mail with
embedded images of clothing items.
Recipients who click on the links would
be brought to the site, where they
could purchase the item.
BEHIND THE CURTAIN
Sweden Unlimited co-owner Leja Kress
uses Internet service provider Verio to
host her clients’ sites and e-commerce
solutions provider CCNow to handle
credit card transactions. In addition to
providing a ready-built shopping cart,
CCNow processes credit card transac-
tions, then alerts the e-tailer when they
have been accepted.The company takes
a 9 percent commission on all sales
instead of charging a monthly fee.
Johnson did use CCNow, but with
this fall’s makeover, brought online
credit card processing in-house.“A lot
of the designers we do sites for don’t
have a merchant account because they
don’t own their own store,”Kress says.
“They sell retail through other stores,
so it works out well for them. But for
someone like Stacy who has her own
shop, it’s better to do it herself.”
Johnson now runs both online and
offline sales using a merchant account
through First Merchant Bank Service.
The change gives her more control over
her cash flow. Proceeds from sales she
made through CCNow were held in an
interest-bearing account in case of
returns. If she shipped $1,000 worth of
merchandise, she wouldn’t see the full
amount (minus the commission) until
several months later.
In addition, the arrangement inter-
fered with Johnson’s relationship with
her customers.“I’d often get a customer
buying on line who lived in Manhat-
tan and would want to return or
exchange a piece at the store,”Johnson
says. “And I couldn’t do it because
CCNow processed the credit card, so
I didn’t even have the credit card num-
ber.” Now Johnson can accommodate
returns and exchanges between Web
site and storefront, and also feels she
can better protect her customers. She’s
now upgraded with Verio, so her site
is on its own secure server. “This way
I get an e-mail in a secure area where
I can read the customer’s card number
and process it through the machine
here in the store.”
Johnson believes that her customers
will be more comfortable buying off
her site now. Previously a customer
would click on an item and be trans-
ported to CCNow’s Web site, because
CCNow doesn’t provide a customized
shopping-cart template. “I think a lot
of people get freaked out buying some-
thing on line when they’re suddenly
taken to another site,”Kress says. Now
they’ll stay in one place the whole
time, and Kress has customized the
shopping-cart template to match Sta-
cia New York’s design format.
By taking control over the shopping
cart, Johnson has solved another prob-
lem. Last season she tried to offer an
electronic gift certificate, but the same
processing issues that interfered with
returns and exchanges gummed up
the process. Now that she’s able to
process credit cards through her own
merchant account, Johnson reintro-
duced the gift certificate.
FUTURE FORECAST
Johnson’s online savvy is beginning to
spill over into her Smith Street shop.
FIT’s Bess says that a strong grasp on
new technologies will become vital
for success in the fashion industry.
“When I work with my students, more
than 50 percent are Internet-savvy,
and we do a lot of communicating that
d e s t i n a t i o n s o h o . c o mFEBRUARY 2001 | SBC
[ a shop grows in brooklyn ]

6. way,” Bess says. “So for those that are
going into the business now, it’s a
comfortable medium to use.”But Bess
believes just as strongly that relying on
the Internet alone isn’t enough. Design-
ers will need to use design and pro-
ductivity software to keep up as well.
For Johnson, technology decisions
take place in between the more imme-
diate tasks of designing and producing
clothes and catering to her customer’s
needs; she’s far from the ideal user that
application designers have in mind
when they cook up their products.
(Sometimes, she’s even used programs
meant for one purpose for many oth-
er functions they weren’t designed
for.) She concedes it hasn’t been the
ideal approach, until recently she has-
n’t had much of a choice.“I just don’t
have time to learn new programs,”
she says. “Everything I’ve learned on
the computer has been for a specific
project I was trying to accomplish.”
But now that the business is on sol-
id ground, Johnson has hired more
employees, and that means more man-
power to work on new projects to
support the store’s growth. Her staff
consists of a retail assistant, three full-
time sewers and cutters, and a design
assistant she hired last summer. She is
now creating an inventory database
using Excel. For this, Johnson chose an
off-the-shelf package that will be
tweaked to fit the store’s limited needs.
“I’m not at a level where we need to
have a computer consultant come in
and build software,”Johnson explains.
“Maybe after my 10th store.”
To date, Johnson’s system for keep-
ing track was to pay attention to what
items got sold in a given day.“I want to
know what sizes and colors are selling,”
Johnson says.“Now when I cut specif-
ic groups and sizes, I’m just guessing.
I’ll cut a 2, 4, 6, 8, 10, but maybe I
should cut more 10s or 2s or 6s. I’d just
like to have some sort of information
on the percentage of what’s selling, so
that the next time around I can have a
better idea of how much to cut.”
From there, she will be looking to
improve in other ways, as well. In addi-
tion to the inventory, the database will
house preferred-customer and press-
contact information. “If I have infor-
mation about what size a customer
wears and what she likes, we can give
her a heads up — and provide a more
intimate shopping experience.”Johnson
says. “Customers will feel like they’re
getting special treatment they would-
n’t find elsewhere.You don’t get service
like that at a department store or a bou-
tique unless you spend $10,000.”
After the database project, Johnson
will have plenty more work to keep her
occupied. A visit to one of the neigh-
borhood stores prompted her to begin
considering a point of sale system.
“Right away it takes care of the inven-
tory, counts the sale, and registers it in
the system,”she says — in other words,
it makes their offline sales as easy as her
online ones. “I’d love to be at that
point,” she says.
Perhaps it’s about time for that inte-
grated system.Although she’s occupied
with the coming season’s designs and
grappling with current production
tensions, Johnson is already looking
beyond both her Smith Street store-
front and its virtual counterpart.With-
in the next two years, Johnson plans to
open a second brick-and-mortar loca-
tion on the West Coast.
N
ATIONAL RETAILERS like Banana Republic,Ann Taylor,and catalog-based
stores like J.Crew and Lands’ End have jumped into e-commerce tech-
nologies, but high-fashion and boutique designers have waded in at
a much slower pace. Donna Karan’s Web site, for instance, remains under con-
struction, though it does include a list of store locations. But industry watch-
ers say the fashion world is starting to cozy up to the idea of selling on line.
Leonard Bess concedes the industry has been slow to embrace the medium.
“When you’re buying textiles, you have to see the fabric, feel the hand of the
fabric,”he says.According to Bess, theWeb’s real value for designers lies in access
to forecasting research. Traditionally, a designer pays a fashion forecaster for
information on upcoming fabric and color trends and perhaps purchases the
actual fabrics through them.“You’re not going to get one for less than $1,000
— and you’re lucky if you get it at that price,” Bess says. “On the Web you’re
bypassing the middle man and accessing the textiles directly. It’s a tool that
helps designers with their due diligence.”
Johnson does some purchasing over the Web. “Obviously some things you
need to touch and feel, but if I’m looking for a basic stretch cotton to do a basic
pant in, I just need color information,” Johnson says. “There are some Hawai-
ian print fabrics I use for summer that I bought when I was in Hawaii. I reordered
them through the company’s Web site, www.fmart.com. Being able to make my
selections was a lot easier than having to fly back to Hawaii.”
The industry has already developed in its use of basic communications tech-
nology. The use of e-mail, for instance, cuts production-turnaround times. All
of Stacia’s sweaters are made on knitting machines in a Hong Kong factory she
first used when she was working at Cynthia Rowley.“At Cynthia Rowley we did-
n’t have computers, so everything was by fax or once in a while by phone, and
it was just such a delayed response,”Johnson says. She finds that e-mail makes
the process far more flexible.“Now we send notes once or twice a day,”she says.
“So when I leave, I e-mail him, in the morning I get in and he’s already
responded to me.The only thing that I send through fax or the mail is an actu-
al sketch or swatch.”
WEB WEAVE
FEBRUARY 2001 | SBC d e s t i n a t i o n s o h o . c o m