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'Old fashioned' values manufacture Motionwear's growth: Acquisition should fuel leotard-maker's expansion

December 18, 2006

It might seem as though the low cost of labor overseas has shifted the entire U.S. textile industry to Asia, never to return.

Indianapolis-based leotard-maker Motionwear Inc. proves otherwise. The 120-employee company was acquired this month by the Italian sportswear firm FILA for an undisclosed sum and, as a result, it's poised to expand locally.

Tom Wilson started the company in his attic in 1988 because his daughter Erin, an aspiring dancer, couldn't find performance apparel she liked in retail stores. Her mother, Emily, a professional textile artist, sewed a costume that made Erin's friends jealous. Soon, the family was producing them for profit.

Tom, who previously worked in finance and accounting, became president. He brought in his brother Bob as vice president of operations, and sister Teresa Mason as vice president of finance.

Motionwear's first customer was Jeff Kinney, president of Indianapolis-based Kinney Dancewear-who served as an early mentor.

"[He] told me, 'There's no money in it and you're crazy to do it,'" said Tom Wilson, now 51. "'But if you insist, here's what you should know.'"

Over the next two decades, Motionwear grew into a substantial operation. Workers at two facilities on the southwest side today make specialty apparel for gymnasts, dancers and cheerleaders that's available in 1,400 retail U.S. stores.

"We've really seen them come a long way," Kinney said. "They're a classic case of someone who found something that worked, and haven't deviated too much from it."

Indeed, Wilson swears by "old fashioned" business principles. Rule No. 1: Do what you say you're going to do. Rule No. 2: Deliver on time.

Motionwear never "bit off more than it could chew," he said. It added retail customers one by one every six to nine months-only when Wilson was certain workers could keep up with their orders.

"When you start at zero, any growth looks good," he said.

Key to Motionwear's success is its proprietary just-in-time manufacturing process. Most clothing-makers manufacture in large batches, creating big inventories. To keep prices low, they often turn to cheap overseas labor.

When those inventories run short, customers end up frustrated, Wilson said. They might receive all the larges and smalls they ordered of a particular leotard, but no mediums.

Worse, delays in overseas shipping mean the order process can require months of turnaround. And if a certain style should catch customers' fancy, there's no way to quickly meet unexpected demand.

But if Motionwear's customers place their orders by noon on Friday, Wilson said, they can count on delivery before the end of the following week. Products typically retail from $20 to $40, which Wilson calls "a little higher" than competitors' products.

"Think Bazbeaux. They don't keep pizzas in stock," Wilson said. "We don't know until Friday afternoon what we're going to do next week."

Looking to expand, Motionwear hired Indianapolis-based investment banking firm Periculum Capital Corp. to find a strategic partner. Periculum fielded multiple offers before choosing FILA because of its established brand name and financial firepower.

FILA didn't respond to a request for comment. The Italian firm, which bought 100 percent of Motionwear, plans to fund a significant expansion. The company will remain here, with the Wilsons at the helm.

"This will be a sale that will create more jobs," said Periculum Managing Director Bob Shortle.

There might be a lesson here for other manufacturers, said Ananth Iyer, chairman of operations management at Purdue University's Krannert Graduate School of Management.

If domestic just-in-time manufacturers make the rest of their processes efficient enough, they can offset their higher cost of labor. And customers are often willing to pay a bit more if they can count on receiving what they need on time, with no mistakes.

"[Motionwear has] stumbled on a sweet spot," he said.

As for Erin Wilson, the inspiration for the business, she now lives in New York, where she works as a textile artist and dancer.


Santos Martinez and his co-workers help Motionwear deliver custom garments to stores in just a week. Wilson
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