Peterman Reboots

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He found it at an outfitter's shop in Jackson Hole, Wyo.: the trademark cowboy coat that he bought for himself, which was included in his first catalog, launched in 1987. The catalog had already become a Hollywood favorite when its kitschy prose--initially written by Manhattan marketing consultant Don Staley--caught the eye of comedian Jerry Seinfeld and Seinfeld co-creator Larry David, who owned some Peterman clothes. "We used to laugh about it all the time," David says of the prose. "When I knew we had to get Elaine [the character played by Julia Louis-Dreyfus] a new job, I thought the guy who wrote this kooky stuff would be great for her to work for."

Peterman learned that he had become a TV character only after the first episode aired, but he didn't mind being portrayed as "a buffoon and a bore." Indeed, he was later allowed to review scripts that included his character six weeks in advance--but he never changed a word. "For the long term, this was good for the brand name and the company," Peterman says, despite the fact that "most people who saw the show didn't know we were a real company." Nor did Peterman advertise to tell them.

By the late '90s, Peterman's expansion plans got out of control. His catalogs bulged with more than 100 pages--up from an initial seven a decade earlier. He added 10 J. Peterman stores in 1998. His five-year business plan called for 70 by 2002, the buildup topped with an IPO. "I took my eye off the brand focus and put it on rapid retail expansion," he recalls. "That was my mistake."

It was a classic one--trying to get too big too fast--that would be repeated ad infinitum by the overfunded dotcoms of the new century. The frantic development diluted the appeal of the Peterman brand and layered new costs onto the company. "This business was highly profitable at $48 million [in sales] a year," Peterman says, "but when we started to push beyond that, it wasn't so profitable." The new merchandise required more buyers and stockers, more inventory and more cash tied up in warehouses. "If I had been really smart, I'd have slashed items and overhead and rolled out the stores more slowly," he adds. "But with venture capital, no one's interested in slow development."

As losses mounted, Peterman's backers pulled out and his bank cut off credit. The company was finished. He didn't even have his name to himself: Paul Harris Stores, a women's retailer in Indianapolis, purchased the J. Peterman assets in a court-ordered sale. "I came out of the bankruptcy with zero," Peterman recalls, "and not only zero in equity, but with hundreds of thousands of dollars in losses. I was in no financial condition to do anything."

Then he had a reversal of fortune. Paul Harris Stores declared Chapter 11 bankruptcy last year and sold what was left of the catalog company to a liquidator last August. Peterman initially raised $600,000 to start his new company, which included buying back the J. Peterman brand name. He relaunched the catalog in June. So far, orders have poured in at more than twice the expected rate.

The current book is a slim 26 pages and targets Peterman's best customers from the good old days. It boasts the same quirky prose (now written by creative director Bill McCullam) and a mixture of old and new merchandise that ranges from an Ecuadorian mountain shirt ($30) to a sidecar motorcycle with "BMW bloodlines" ($8,395).