Art Of The Deal: Bon Business

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MALKA, 45, A SHOE MAN FROM MONTREAL, says the company underwent some changes after he became president in 2001 (before that he headed the footwear division from its inception in 1995). "We decided it was important to not just have a single brand. So we created a multibrand, multichannel distribution concept, where you're selling 20 to 10,000 garments. This allows us to go from junior to haute couture, understand consumers from Tokyo to Wisconsin and mass merchants to Bergdorf Goodman. We're going to make sure that every one of our 16 brands has a voice and a very differentiated model." Their slew of brands includes BCBGirls, BCBG Attitude (men's ready-to-wear), Max & Cleo (dresses), Noun (tops and sweaters), Maxime (pants) and young contemporary labels To the Max, Dorothée Bis and Parallel.

Malka also got production and shipping in order at a time when technology had begun to offer consumers other options. "As the market changes, if you don't change, you die. Demand planning has changed aggressively in the last few years. Every element of your design and supply chain has to be geared towards speed-to-market tactics," he says. "We're one of the few in the U.S. market at our level capable of reacting to fashion the way we do because we've put our machine together that way. That means quick decision making, being able to control and respond to demand and organize your supply, and being able to fulfill that demand. It's very complex."

What's simple, says Malka, is what unites BCBG's staff of more than 10,000 worldwide. "If you really want to understand the essence of our company, look at the society we've built, with our own rules, our own laws. It shocks me how much the culture of a company can move it forward. It makes me laugh when headhunters call and try to take a designer from us. So many of them have come back here because they realize that they're not as good without the team. Max and I get a lot of credit for work that is done by a movement."

So what's next? Azria wants to take the company public but not imminently. "We expect to reach $1.3 billion in revenue in 2007," he says. "Any company of my size cannot live without thinking it's possible to go public one day." This fall the group will introduce an inexpensive line of teen clothing called MaxRave in 488 stores around the country. It will also launch its first online store early next year. "When I first met Max, he was doing items, baby dolls," recalls Lubov. "I pushed him into doing collections, juniors. You miss out on sales when you do items. People want to see what your vision is as a whole. Of course Max was a visionary because 10 years later it was all about items."