Is Venroy the next Billabong?

Is Venroy the next Billabong?

December 9, 2013

Jake Mitchell

Entrepreneurs spark a new global board short culture. From the humble beginnings of a small factory in Marrickville in Sydney’s inner west, Sean Venturi and Theo Smallbone have carved out a global footprint, with a bricks and mortar presence in Tokyo, New York and Los Angeles, where they claim to have spawned a new board short culture: “above-the-knee” swimwear for blokes.The proprietors of Venroy Boardshorts have focused on global expansion since their first batch of men’s swim wear was distributed throughout Sydney’s eastern suburbs in the summer of 2010.

We have noticed, particularly on the West Coast, a huge difference in term of guys wearing shorter board shorts. 

“We had absolutely no idea,” Mr Venturi says. “We made 60 pairs of shorts and were making about $5 a pair but we had a trip planned to the US so we thought why not take some designs over and see how we go?”

“By the time we left, we had three retailers in Sydney but we wanted to capture the Northern Hemisphere summer and in my view, Australians will only really support a brand once it is supported overseas.”

After walking the streets of West Hollywood cold pitching Venroy shorts to retailers without much luck, Venturi was told the products would never succeed in the US because Americans preferred longer boardshorts that covered the knee.

Far from disheartened, the young businessmen dropped the boardshorts by an inch, although keeping the length above the knee, and Venroy finally cracked the market through renowned LA retailer Fred Segal, which was followed by American Rag, W Hotels and other big names.

Fast forward two years and Venroy can claim a hand in setting a new trend in men’s swimwear.

“We have noticed, particularly on the West Coast, a huge difference in term of guys wearing shorter board shorts,” Mr Smallbone says.

“In fact we’ve got two copy cat brands selling over there that have completely ripped off our designs and website.”

The numbers suggest more Americans are venturing into the shorter short, with the company expecting to sell more than 18,000 units next year, including the launch of knit products like T-shirts, which represents about 35 per cent growth on 2013 in terms of
volume.

Boardshorts retail for about $100 a pair and T-shirts go for about $60.</p><p>About 40 per cent of sales are made in the US, 30 per cent in Australia and 15 per cent in Japan, with the remaining sales coming from Canada, Spain, France and the French West
Indies.

Venroy has also broken into the resort market including Hayman in Australia, Four Seasons Hotels, W Hotels and Bellagio Las Vegas.

About 20 per cent of revenue comes from online sales and the company is hoping to ramp up this earnings stream due to the higher margins on offer compared with partnering with a bricks and mortar retailer.

The company has launched a new website, focused on delivering a better e-commerce platform and design.

“It’s in our interest to grow online sales and we are looking to do that through a range of measures including digital marketing and shipping incentives,” Venturi says.

Key to Venroy’s expansion has been the offshoring of manufacturing to the southern Chinese province of Guangdong, about two hours ferry ride from Hong Kong.

“In China, if you go for cheap, you will get cheap,” Smallbone says.

“But if you’re prepared to pay a little bit more, the quality is world class.

“Even Prada manufactures in Guangdong.”