Louis Sinsheimer remembers the day he was helping a bank executive -- partial to strawberry polyester suits -- pick more "professional" looking attire.
"Can you believe, out of 25 possible colors for blazers," exclaims Sinsheimer, "he chose pink?" The banker was eventually steered into a more conservative forest green.
Wardrobe consulting and leasing appropriate garb for the boardroom, the sales room, even the funeral parlor -- for which they've rented a dozen black raincoats -- is a growning business, says Sinsheimer, senior vice president of Haas Tailoring Co., Baltimore, and its sussidiary, Guilford Leasing.
Precisely how much rental business Haas (which produces 1,100 custom-made suits weekly) is doing company president Irving Neuman won't say, except that they have had the biggest six months ever in the history of the business. (It was started after the Spanish American war, with merchant tailors selling suits for $10 to $12.50, including a year's free pressing.)
Neuman got the idea for leasing men's suits a couple of years ago, when he received a thick envelope from the state of New Jersey suggesting Haas Tailoring bid on an order to make, and distribute on a rental basis, 700 suits for prison guards. If it was unlikely that that crowd would need the Haas variety of custom tailoring ($350 to $650 for most suits), maybe someone else out there would.
"Companies were well used to leasing all types of equipment . . . furniture, trucks, computers, why not clothes for their men and women executives?" figured Neuman. Afterwards the suit would be salable in the secondary market, or given to charity. (He since has learned of the success of the London firm Denman & Goddard which, for the past three years, has leased suits as company perks.)
Sinsheimer and Neuman had worked with the growing crop of sales reps, college-educated men and women who advise on and sell custom-made clothes for business.
Neuman ("The men's business world is a dress standard world") proceeded to send letters to major companies offering a suit-leasing arrangement so that "in a couple of years you will have a coordinated wardrobe to look like the company executive you are."
When he has their attention, Neuman tells chief executive officers and bank tellers alike that they should dress in keeping with their letterhead and logo. "They really understand that."
The clincher, he says, is in the financing. And while he won't be specific about how much it costs to rent suits, they won't consider any order for less then $5,000 or more than $20,000. The price, he says, varies with the prime interest rate.
The bonus to companies is that part of the cost is considered a tax-deductible business expense, with the U.S. government picking up a share of the tab. The bonus to the man or woman getting the suit is, obviously, the suit.
"Cost of leasing the suits is written off as a business expense," says Sinsheimer. "And those receiving the suits report their value as taxable income, after consulting fees are substracted."
For the moment the Internal Revenue Service has no published position on suit rentals, but it is "under study," says an IRS spokesperson. Such things generally are included under Law 162, which provides that "all ordinary and necessary business expenses are deductible." The personal use of such items, however, must be listed as income.
Here's how the suit leasing works. Neuman, Sinsheimer or another Haas executive helps a company decides how many suits are needed, and who gets them. When the company gets the bill, 35 to 40 percent of the payment is typically booked as a consulting fee, so that if the order is for 50 $400 suits, the fee is 40 percent of $20,000 or $8,000. Both the charge for consultation and for the suit (in IRS lingo: ordinary and necessary business expenses) are tax-deductible.
Company executives are then custom-fitted in a suit made from a choice of 600 fabrics fitting within the price range settled on. Both the boss and the potential wearer are interviewed and helped with choices by a consultant who considers such things as eye and hair color, complexion, and function in the company.
Since the suits represent 60 percent of the gross payment, the employes who own the new suits are considered to have received benefits worth $240 per suit. Neuman suggests splitting the benefit over a two-year period so an executive in the 50 percent bracket gets to wear his $400 suit for only $60 a year.
"If the company buys the clothes, the employer gets a real preminum," adds sinsheimer, who equates the bonus with a pop-up toaster on washing machine given a top salesman.
A variable is the range of consulting services a company might need. The funeral parlor, for example, needed only minimal help in selecting its black raincoats.
"In a multi-office in several locations with lots of travel involved to do the fittings, of course the fee is much higher," says Neuman.
The service, he stresses, is legitimate only if there is a real consultation service. The company has to direct it and the company should pay."
Neuman won't say which companies are providing suits for their employes, but orders seem to be arriving regularly. Last week there were five company orders for leasing, among them a Florida insurance agency planning to outfit 62 salesmen, a Texas company requesting suits for 16 company executives, four of them women, and a Washington firm (identified only as a non-government agency that does a lot of business with the government).
Says Neuman, when pressed to be more specific, "Would you want someone to know you are wearing a rented suit?"