Maker of military-style clothes gets Virginia export aid
The enduring appeal of Air Force flight jackets and Navy peacoats has transformed Alpha Industries, the Chantilly manufacturer of military-inspired apparel, from the Defense Department's clothier into a popular brand sold at Urban Outfitters and Zappos.com.
In its 52 years in existence, the retailer has continually found new ways to market its clothing. Alpha found fertile markets abroad and created a distribution model that eventually landed it in some 50 countries worldwide.
That ingenuity is why the Virginia Economic Development Partnership recently selected the retailer as one of four Northern Virginia companies to receive assistance in expanding its global exporting operations through the Virginia Leaders in Export Trade program.
"They have a true commitment, enthusiasm for international business," said Leslie Parpart, manager of the trade program. "They're already an established international company and we're just looking to help them accelerate in some markets and grow into others. They are a perfect fit for our program."
International retail sales to countries in Europe and Asia accounts for more than 60 percent of Alpha's business, or roughly $100 million in annual revenue. That segment of the business kept the retailer thriving during the depths of the recession, as global sales increased approximately 20 percent in 2009, according to the company's president, Lee Aaron.
The momentum continued into the following year, with Alpha registering about 25 percent year-over-year growth from its international operations and burgeoning Internet sales business. Aaron said the company is now targeting Brazil, which has one of the fastest growing consumer markets in the world.
Jumping into consumer sales has been a good move for Alpha. When the family-owned business opened its first factory in Knoxville, Tenn., producing uniforms for the military was its bread and butter. To date, the company has made more than 40 million pieces of military outerwear. That business, however, has fluctuated over the past few decades, with precipitous declines in the 1990s. Military contracts now are less than 5 percent of Alpha's business.
By the 1970s, it became apparent that diversification would be key to the company's sustainability. Alpha at that time stepped into the consumer space by supplying surplus stores with leftover product from fulfilled contracts. The company also began manufacturing its goods in the developing world to reduce costs. About 90 percent of the company's manufacturing now takes place in countries like Vietnam and Pakistan, though Alpha has maintained a distribution center in Tennessee.
Alpha made a major move into consumer apparel in the early 1980s, with new designs and merchandise that maintained the authenticity of the brand while being fashionable. Around the same time, the company got hip to the full potential of overseas sales.
"Demand was higher outside of the United States because our [surplus] product was being shipped overseas," Aaron said. "People wanted real Americana. And they still do."
Now it's just a matter of reaching them all, with the assistance of initiatives such as the Virginia trade program. Alpha, and other selected companies, will have access to a team of seasoned international service providers, including attorneys, bankers and freight operators. The two-year program will also cover up to $15,000 in expenses for marketing or legal fees, for instance.
There are currently 40 businesses participating in the trade initiative, which has helped more than 140 companies increase their international sales in the past nine years. Graduates of the program have reported a 44 percent growth in revenue earned from global transactions.