Retailers ride a wave

Trendy surfwear styles stoke solid back-to-school sales

By Naomi Aoki, Globe Staff, 8/28/2003

PEABODY -- No matter that New England isn't a surfing mecca or that colder weather is fast approaching. To 14-year-old Kim Miller, surfwear is hot.

"I like the surfer style," said Miller, who will be a freshman at Andover High School and who sheepishly admits to owning nearly two dozen pairs of flip-flops.

This week, deep in the heart of back-to-school sales season, Miller is one of many teens parading through the Pacific Sunwear store at the Northshore Mall, checking out a vast assortment of skate shoes, hooded sweatshirts, and beachy T's.

Spurred on by surf movies like "Blue Crush" and reality television shows like WB's "Boarding House" featuring a cast of professional surfers, even teens who've never seen the mean underbelly of a breaking wave are eagerly embracing the surfer style, which has even permeated designer collections for adults.

Retailers are jumping on board. Junior sections of department stores are filled with surf brands like Billabong, Hurley, and Roxy. Macy's devoted a section to Surf & Skate. Shares of retailers known for surfwear, like Pacific Sunwear of California Inc. and Quiksilver Inc., are trading significantly higher than they were at this time last year.

The trend is one of the key forces driving what seems -- at least so far -- to be solid back-to-school sales, said Marshal Cohen, chief industry analyst at NPD Group Inc., which tracks retail trends. Some retail chains are reporting sales increases of 5 percent or more over last year -- before counting sales from newly opened stores. Overall, Cohen expects a 2 percent jump in back-to-school sales, from pencils to parkas, this year.

Though modest, analysts say, the increase is a salve after two years of disappointing sales. Parents and children are expected to spend more than $14 billion this year on clothing and school supplies.

Add in the college set, and the number climbs to nearly $40 billion, according to the National Retail Federation, making it the second most important retail season behind the holidays. And a strong back-to-school season is a sign of good holiday sales to come, analysts say.

"Surfwear is the one fashion trend bringing newness to the wardrobe," Cohen said. "Jeans are hot. But they've been hot for a few years. If I have five pairs of jeans, do I need a sixth? But the surf look is creating the need to buy something new."

Some teens aren't thrilled about surfwear's rise in popularity. Jessica Cantin, 16, who will be a junior at Bishop Fenwick High School in Peabody, has donned surf-style clothes for several years. She doesn't surf, but she snowboards and skateboards. (Culturally speaking, the three board sports are close kin, and surf stores tend to cater to all three sports.)

For Cantin, the clothes represent the values of the surf-and-skate culture: individuality and athleticism infused with a laid-back spirit. But with everyone adopting the surfer style, the clothes become more about fashion than attitude. Even Cantin's 12-year-old sister Lindsey, who once made fun of the elder Cantin's fashion sense, is now into surfwear.

"I go to the mall now and everyone looks like me," Cantin said. "I don't like it. It used to be that if people were wearing surf or skate clothes, it was about the kind of person they were and what they did. Now it's about being popular. I hope it's one of those fashion trends that goes fast -- like bell-bottoms."

Retailers and analysts expect the surfwear trend to last, at least, through the holidays -- precisely because the trend is as much about lifestyle as it is about fashion. The clothes are casual, athletic, and comfortable. Most adults don't wear surfwear -- a plus since teenagers want something they can claim as their own. The popularity of extreme sports like surfing, snowboarding, skateboarding, and mountain biking are likely to continue fueling the fashion trend.

"Everyone wants to be modern and hip," said Rob Gundel, manager of the Quiksilver store at Braintree's South Shore Plaza. "To wear a brand that's going to tell people, `I'm athletic. I live the surf culture.' It's about being laid-back. You don't have to surf."

Judging by the traffic in his store, Gundel said, the surfwear trend is on the rise. The early part of the back-to-school season was busier than the spring or summer months, and is on track to top the company's back-to-school sales last year. The company, started in 1969 by two Australian surfers making board shorts for other surfers, has grown rapidly. Riding a rising tide of profits, it made four acquisitions in 2001 alone. In the fiscal year ending October 2002, it reported $705 million in sales, up from $620 million in 2001 and $317 million in 1998.

Analysts say rival surfwear retailer Pacific Sunwear is putting in an even more impressive back-to-school performance this year. The company traces its roots to a single surf shop, opened in 1980 by Tom Moore in Newport Beach, Calif. Like Quiksilver, it has expanded quickly, opening about 50 stores a year through the 1990s. It opened 75 new stores last year, reaching a total of nearly 800 stores. It expects to open another 75 stores this year. PacSun had sales of $846 million in the fiscal year ending January 2003, up from $684 million in the previous fiscal year.

"Surfing is everywhere these days -- in movies, on television shows, music videos. I think it's here to stay for a little while," Gundel said.

Quiksilver shares rose 30 cents yesterday to $17.50, and are up nearly 70 percent from a year ago. PacSun rose $1.13 yesterday to $33.93, and its shares are up more than 150 percent from a year ago.

Surf's up -- even on Wall Street.

Naomi Aoki can be reached at naoki@globe.com.