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This article could be titled: The Rise and Fall and Rise and Fall and Rise of Brenda French.

Over 30 years ago, 64-year-old Brenda French began her career in business with a $500 investment. She founded French Rags as a home based business in 1978. Her investment really paid off, not only would Brenda's knit rayon scarves soon be a major department and specialty store item nationwide, but she opened her own factory a year later, and introduced the first French Rags sweater.

During the next few years, French Rags evolved into a coordinated line of knitted sportswear with sales reaching five million dollars. By the time sales hit eight million dollars, she had the idea of selling her line directly to consumers and offering mass customization of her knits. In doing so, she revolutionized the fashion industry. French Rags specializes is leading the industry in direct consumer merchandising by selling its designer collection through independent wardrobe consultants via trunk shows around the country. But just like all entrepreneurs, Brenda faced many challenges and triumphs which she shared at the Women's Leadership Exchange conference in Southern, California.

In Her Own Words: How She Got Started

The reason I started my business was because I found myself a single parent. I was at the point where I recognized that I was going to raise this boy by myself, and there was no point in going after alimony and child support because it would take me too much time. I realized that I could not bring him up with any kind of dignity unless I could control my own life and I couldn't control my own life if I was working for anybody else. That was 25 years ago. I think that today, women are accommodated much more in the workplace than they were then. If your kid had a fever, you were supposed to stay at work, grin and bear it. You could not leave the office and go and take care of him. I think that's changed quite a bit.

So I kept asking myself, "What can I do, what thing never bored me and has always fascinated me?" And when I actually got down to the answer, it was very humiliating-- KNITTING! How can I have a business built around knitting? How could I even admit this to myself? I mean, I have a degree in English Literature! But I had a friend who had a wholesale business and through her I was able to purchase a knitting machine. It cost very little, and she paid for it and let me pay for it later. And so, I started knitting. And French Rags was born.

Heading for a Crash

The first ten years were terrific. Nicholas went to a private school. I bought a nice house in the Palisades and put a pool in. It was all going very well. Until 1989. The big crash of 1989 hit the retail business like a ton of bricks. In one year, French Rags lost 300 department stores in America. When those stores went out of business, what happened to the manufacturers? A lot of merchandise went back to the people who supplied it. Anybody who knows the retail business knows the horrendous thing we have to deal with, which is charge backs. So, in a one-month period of time, I got a million dollars worth of knits back from Bonwit Teller. First of all, they were all factored, so I had had the money and spent it. And second of all, they'd been hanging on hangers for about a month.

Recession Reinvents the Business

So, the accountants, came to see me and said, "Well, you'll have to liquidate, you'll have to get out of this, you'll get ten cents on the dollar." I was like, "10 cents! What are you talking about? I can sell this stuff myself and make more money!" So now I got creative. And you know what, I got 50 cents on the dollar. What I did was, I took my shipping department and turned it into a store. And I put an ad in the paper and people came. And people bought. And guess what? I got 50 cents on the dollar! That's when the first revelation came. I thought, "Wow! I don't need the stores!"

The second revelation came soon after. During this time, a lot of people called looking for money. A lot of people called trying to sue me. I couldn't afford a receptionist, so I took all of the phone calls myself. At one point I got a call from a woman who said, "My husband wants to put you in business again. He's going to open a store and we're going to sell French Rags in the store." And I thought about this and I thought, "No. What was wrong with retail is still wrong with retail. That's not the way to go." So I said I'm sorry, I don't want to do this, but she pleaded with me to please come to New York. She said, "I've got 2 spare bedrooms, why don't you bring some clothes because I know enough people in New York who would buy from you. Why don't you come and sell?"

And I thought, "Huh, a year ago Bonwit's was flying me in first class, I was staying at the Plaza, had windows at Bonwit's and a full page ad in The New York Times, now I'm in someone's spare bedroom on Park Avenue. What happened here?" But I said, ok, ok, I'll go. In five days, I sold $80,000 dollars worth of clothes. Even better, I got money in hand! That was the other big "ah ha." "Oh, maybe you don't have to get paid later! Maybe you can get paid ahead of time."

So that lady in New York became my number one consultant. Her sister-in-law in Chicago became my number two consultant. Her daughter in Sacramento was number three. The wonderful thing about my survival at that time was that it was purely affected by women who wanted to help me. They opened their homes, they opened their hearts. I had women who'd seen the clothes, who wanted to represent me. And they wanted me to come to wherever it was and do a trunk show. I'd fly places and stay in someone's home someone who I never knew before in my life, and we'd do a trunk show in her living room and become fast friends. And many of those women are still with me today. It's been a very interesting journey.

Lesson Learned: Give Customers a Voice

So that's how I got into the whole thing of direct selling, which has fascinated me, and what I love about direct selling the most is that there is tremendous feedback. The feedback I got from the department stores I knew was baloney, so I never used to pay any attention to it. But when I talk to women, they ask me, "Do you make high necks?" Or, they tell me, "I don't have a waist anymore." I learned that if I listened to what women "my customers" had to say, and I was prepared to change and adjust depending on what I was told, then I found my business would keep going successfully and keep re-inventing itself.

So, I listen to my customers. I go into the direct selling business and I have 65 consultants all across America. And this was all going very, very well until a few years ago when the economy tanked. When 9/11 happened, as you all know, we got the biggest double, triple, quadruple whammy that we ever had. How did it effect my business? We lost a month's worth of business. What could I say to a woman who says to me "I can't buy clothes at a time like this!" Well, of course you can't. But how am I going to make payroll? So at that point, we took a huge hit. A huge hit that almost seemed we couldn't get beyond.

So, what do you do when that happens? You get creative again. You look at what you do and you make it better. You figure, if this is what's going down, then I've got to be better than everyone else, otherwise, I'll never survive. So we did that. We looked at ourselves and we decided that we would get better. And at the same time as doing that, I talked to a lot of clients again. And one of the interesting things that happened over the past five years is the amazing increase in women of color in business. Simultaneously, I had more and more clients who were women of color.

As a result of this, French Rags has moved into a new niche market. We are now working with women of color and saying, "Yes, you wear different colors, you look better in different colors, because you are a different color. And you look great in pink and blue and green. You look wonderful in those colors and those are the colors we should be giving you. And, yes, your body is a different shape than my body, and it needs a certain focus so we can make you look fantastic in a way that works for you." By focusing on this, by talking about it, we've realized that there's a huge area of niche marketing, which has not been addressed at all by anybody other than cosmetic companies. So, we're now addressing that successfully and have found a new path that we?re pursuing which really only happened because we listened to our clients.

The Women's Leadership Exchange has more fabulous articles for to inspire and encourage women!

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