Skip to main content
Select Source:

Esprit de Corp.

Esprit de Corp.

900 Minnesota Avenue
San Francisco, California 94107
U.S.A.
(415) 648-6900
Fax: (415) 415-550-3951
Web site: http://www.esprit.com

Private Company
Incorporated:
1970
Sales: $350 million (1998)
Employees: 1,300
NAIC: 315212 Womens, Girls & Infants Cut & Sew Apparel Contractors; 42233 Womens, Childrens & Infants Clothing & Accessories Wholesalers

Esprit de Corp. designs, manufactures, and distributes a wide variety of apparel and fashion accessories for women and children. Renowned for fostering a sense of social responsibility among its employees and customers, the company built its image on commitment to such causes as AIDS awareness and environmental conservation. Having soared to high-profile success from the mid-1970s to the late 1980s, by 1992 the company had plummeted to a state of financial ill-repute where it remained until the late 1990s, when the company launched a comeback under new leadership that freely capitalized on the brand recognition won during Esprits glory days. The Esprit brand is marketed in 44 countries and is available in department stores, specialty stores and over 350 freestanding Esprit retail stores. The late 1990s saw the addition of a web site and a reinstated catalog as important alternative marketing venues.

Early History

Esprit was built primarily by Doug Tompkins and Susie Tompkins, a husband-and-wife team whose personal and political values informed the companys early business strategy. The couple met outside Lake Tahoe in 1963, when Susie Russell offered the hitchhiking Doug Tompkins a ride in her Volkswagen. Both Susie and Doug were from wealthy backgrounds and had dropped out of high school to explore more Bohemian lifestyles. After several months of travel together in Mexico and the western United States, they married and settled in San Francisco. There they embraced the social causes and fashions of that citys active counterculture.

In 1964 Doug, an enthusiastic skier and rock climber, invested $5,000 to start a retail business devoted to mountaineering equipment. Called North Face, the store was established in a prime location across from San Franciscos popular City Lights Book Store, and it quickly achieved success. Because of his capable staff, who oversaw daily operations, Doug was able to spend much of the year on international rock climbing and skiing expeditions. Susie remained in San Francisco, raising the couples two children and occasionally assisting at the North Face store.

During this time, Susie Tompkins became interested in a business venture proposed by her friend Jane Tise. Together they formed the Plain Jane Dress Company, which offered puffed-sleeve, acrylic minidresses that Tise designed and Susie distributed. After the Plain Jane dress line became successful locally, it was marketed to New York department stores by Allan Schwartz, a salesperson who became a partner in the company.

Late in the 1960s, having sold the North Face operation for approximately $50,000, Doug Tompkins joined Plain Jane as a partner. While Tise and Susie designed the product and added new designs and labels to their popular line, Doug and Schwartz handled the marketing and sales responsibilities, targeting affluent California households with colorful, oversized catalogs.

Growth in the 1970s

By 1970 Plain Jane had sales exceeding $1 million a year. Doug and Susie Tompkins owned roughly 45 percent of the company, while Tise and Schwartz held the other 55 percent. At this time, some observers allege, Doug Tompkins stepped up his interest in the company, making bold decisions concerning the companys direction and professing an interest in taking charge. He was instrumental in steering the companys focus to more contemporary designs as the American hippie look subsided. In 1972, after he and Susie visited several countries in Asia, Doug decided to move manufacturing operations to Hong Kong, where clothing could be produced less expensively.

Schwartz and Tise sold their shares to the Tompkinses in 1976. Although Schwartz left the company immediately thereafter, Tise remained as chief fashion designer until 1979, when she reportedly became dissatisfiedas Schwartz hadwith the lack of input allowed her by the Tompkinses. That year Susie took charge of the design department. By this time the company had expanded its product line under several different labels to include pants, blouses, and skirts. These different divisions of the company were soon reorganized and consolidated, and Plain Jane was renamed Esprit de Corp. The companys trademark loose-fitting casual designs in bold colors caught on, and Esprit rapidly evolved into one of the most popular clothing companies among 18- to 24-year-old women.

The Brand Becomes an Image in the 1980s

During the early 1980s Esprit swiftly expanded and distinguished itself in the business community through both its sales and the way in which it reflected the eclectic tastes of Susie and Doug Tompkins. An art and architecture enthusiast, Doug Tompkins spent a great deal of time and money to renovate the San Francisco winery that would become the companys new headquarters. Featuring skylights, wood floors, and Amish quilts on the walls, the brick building gained national recognition among architects and interior designers. The facility offered Esprit employees access to tennis courts, a running track, and a trendy café. Seeking to create an enjoyable work atmosphere to match the spirit of Esprit clothing, the Tompkinses encouraged employees to dress fashionably yet casually; high heels were not permitted on the easily scuffed wood floors of the headquarters building. Furthermore, the Tompkinses offered a unique benefits package. In addition to a 52 percent discount on Esprit clothing, employees received subsidized tickets to the theater, ballet, and opera, as well as free vacations in the mountains and foreign language lessons. Employees came to refer to their workplace as Camp Esprit and Little Utopia.

From 1979 to 1985 the companys sales grew from $120 million to $700 million. As design director, Susie approved all drawings and fabrics, while Doug held the titles of president and image director. During this time, Esprit became the first clothing company to require department stores to relegate a part of their sportswear section specifically for use as a shop within a shop. While the concept called for a relatively large amount of floor space, expensive track lighting, and special signage, many department stores complied because of the Esprit lines high sales volume. Catalogs also served as an important marketing strategy in the early 1980s. Oversized, glossy booklets featured pictures of employees and other real people modeling Esprit clothes, alongside written personal statements. In an interview, Doug Tompkins asserted that the Esprit customer is of above-average intelligence and knows the difference between substance and superficiality. Women who wear Esprit, he concluded, are the new feminists.

Between 1984 and 1986 the company borrowed nearly $75 million to open several retail stores, the first of which was a superstore in Los Angeles that showcased Doug Tompkinss design taste. The store cost about $15 million to build. Subsequent stores were established in New Orleans, San Francisco, and Aspen, Colorado, and by 1987 there were 14 Esprit retail stores nationwide. While owners of department stores that carried Esprit clothing protested that these retail outlets represented unfair competition, company executives disagreed.

Fiscal Stumbling in the Late 1980s

As Esprit grew, some critics charged that the company was overextending itself. In late 1986 and 1987, Esprit experienced losses for the first time in its history. Earnings fell from $62 million to $10 million, representing an 83 percent downturn. Several reasons were given for the abrupt reversal. The San Francisco Examiner suggested that competitors were copying Esprit designs and offering them at lower prices and further reported that some retailers were complaining of inferior quality and design in new Esprit lines. The Tompkinses maintained that while the company may have tried to expand too rapidly, its spring lines were selling well. They pointed to the decline of the U.S. dollar as the primary reason for the companys losses. Furthermore, they maintained, while international sales were escalating, Esprits foreign operations were jointly owned with local investors so that profits were reinvested in the foreign market.

In 1986 Doug Tompkins turned Esprit over to Corrado Federico, who became the companys president, while Doug remained as Esprits CEO and chairperson. Exploring ways to cut the companys costs and consolidate its operations, Federico implemented a freeze on hiring and bonuses that year. Although employees were soon required to pay for coffee and phone calls made in the office, the Tompkinses ensured that some of the unique benefits that made up Esprits image as a fun, creative workplace remained. The following year the Esprit work force was cut by 30 percent, and Doug Tompkins brought in experts from rival fashion companies to manage the newly consolidated divisions.

Company Perspectives:

There is no one perfect Esprit woman. Because Esprit is about the individuality of many. About whats on the outside and whats on the inside. About variety of sizes, shapes, colors, faces. There is no one perfect Esprit woman. There are many. She is the woman everyone wants to be. She was born a woman and just keeps getting younger. She doesn t lead and she doesnt follow, shes just out there if you can catch up with her. She believes that if you believe it, it will come. She believes that words havent lost their meaning, like love and desire, like forever and a day, like different but the same, like life is what you make it.

It soon became apparent, however, that Esprits downturns were more than just temporary. Critics cited both Esprits failure to stay abreast of fashion trends, as well as irreconcilable differences that had developed between Susie and Doug Tompkins, as reasons for the companys troubles. Specifically, the Tompkinses had begun to argue about the direction the company should take. Susie regarded the companys image as too young, maintaining that customers were seeking a more sophisticated look. She believed Esprits original customers had grown up, and she suggested introducing a line of corporate wear for the loyal Esprit buyer. Doug, on the other hand, argued that the companys youthful image was too important to change and that corporate women would not purchase Esprit.

In March 1988 the Wall Street Journal reported on the rift between the Tompkinses. While the column focused on the couples relationship and Dougs alleged extramarital affairs with women in the company, it also reported that weak financial management and the design departments failure to note the fashion worlds shift to a more traditional look were hurting business. In addition, interviews with former Esprit employees revealed that tension in the workplace was being fostered by two factionsthose who sided with Doug and those in Susies camp. The article also revealed that Doug was seeking minority equity partners to help maintain the struggling Esprit retail stores.

Doug Tompkins Takes Over in the Late 1980s

When Susie Tompkins petitioned a San Francisco court to appoint a third director to help run Esprit in March 1988, a judge advised that she and her husband resolve the situation without legal intervention. The following month, hoping to reverse the stalemate, the Tompkinses appointed three new directorsPeter Buckley, Isaac Stein, and Robert Bartlettto turn Esprit around. By May of that year the new board recommended that Susie and Doug each remain 50-percent owners of Esprit but that they give up their operating control of the company. Under the plan Esprit president Federico became chief executive officer. Doug was given the title of chief executive officer of Esprit International operations and was required to abandon the idea of expanding Esprits retail establishments through outside financiers. While many of Dougs duties at Esprit remained the same, Susies role at the company changed dramatically. No longer the chief fashion designer, she was effectively out of the business. As a fashion consultant to Esprit she kept in close contact with the management team but announced that she would also spend time away from Esprit, concentrating on her volunteer work for such social causes as AIDS awareness. Early in 1989, Susie and Doug Tompkins filed for divorce.

That year Doug pursued his growing interest in environmental conservation within the parameters of the fashion industry by instituting a new marketing strategy in which the company actually advised the customer not to buy Esprit clothing if she did not need it. Doug argued that consumerism in general, and especially in the fashion industry, was leading to the destruction of natural resources and that Esprit should thus introduce clothing that would outlast the seasonal fads. Dougs buy only what you need campaign included hang tags with the warning on each article of clothing, as well as a new line of fashions in more traditional, muted colors. Initially the line was profitable, but it eventually declined, and, during this time, critics noted that Doug seemed to be more interested in ecology than fashion.

While Esprit had recovered from the previous two years losses, the company was still regarded as unsteady and lacking a corporate vision. In July 1989 Esprit announced a new plan to refocus Esprit under one Tompkins. Doug was given the option to buy out Susies 50 percent within 120 days of the agreement. If he did not, both halves of the company would go up for sale at auction. Clothing and footwear manufacturing giants Benetton and Reebok became interested in acquiring Esprit, when, after the requisite 120 days, Doug had not exercised his option.

Analysts speculated that by forcing the auction of the company Doug had initially hoped to acquire Esprit for a lower price than he would have paid to buy out Susies share. However, as Reebok and Benetton became interested in purchasing Esprit, the price would have escalated. Furthermore, during this time, Susie was recruiting financial backing from the venture capitalist Bruce Katz, Esprits head of Far East operations Michael Ying, and Isaac Stein. One day before the bidding on Esprit was to close, Doug and Susie worked out a deal, and Esprit never went to auction. Industry observers believed that Doug had been concerned that both he and Susie would lose the company to higher bidders, and, in order to keep Esprit in the family, he accepted Susies offer in return for some interest in the companys international division.

Susie Tompkins: Solo in the Early 1990s

Susie Tompkins returned to head Esprit amid much publicity. Trade journals, newspapers, and magazines depicted her as the victor in the war to control Esprit. Some observed, however, that the recession of the early 1990s could prove particularly challenging for the company and her leadership. Under Susies ownership, Stein was named Esprits chairperson. Federico remained president until his resignation in April of the following year; Stein subsequently assumed the presidency. Appointing herself creative director, Susie brought back the design team with which she had worked before leaving Esprit in 1988. Expressing the desire to produce casual fashions that exuded social awareness, she stated that her mission was to ensure that Esprit inspire good values.

In 1991 the recently appointed image director, Neil Kraft, produced the What would you do? advertising campaign that surveyed young people about how they would like to change the world. The $8 million campaign featured quotes from Americas young people on such issues as racism and abortion. Although the advertisements won several awards and generated a great deal of media attention, sales figures were nevertheless disappointing. The following year Kraft left Esprit, and his duties were taken over by Fritz Ammann, who was named chief executive officer while Stein remained chairperson.

Pursuing her goal of promoting a socially responsible work force, Susie Tompkins replaced the employees free vacation program with a lunchtime lecture series featuring controversial figures speaking on current issues. She also established a volunteer program that paid Esprit employees for working ten hours per month at a nonprofit organization, providing that the employee matched that amount of time on his own. Furthermore, the ecological soundness of Esprits manufacturing practices was monitored by a new environmental and community affairs department in the company called the Eco Desk.

The Ecollection line of Esprit clothing and accessories, touted as both ecologically sound and fashionable, was introduced early in 1992. The line featured buttons made from reconstituted glass or carved from nuts, organically grown or vegetable dyed cloth, and purses handwoven in a Mexican cooperative. Also that year Susie introduced the adult clothing line she had conceived years before. Tompkins referred to the designs as creative career wear for the Esprit customer who had matured. The tailored trousers, sophisticated, pleated skirts, jackets, and vests were manufactured in earth tones such as plum, green, brown, and burgundy. Tompkins maintained that these clothes were functional as well as fun and appropriate for the business world. The unconventional fashion show at which the Susie Tompkins collection debuted received mixed reviews. Rather than provide a runway and models, Susie commissioned Reverend Cecil Williams of San Franciscos popular Glide Memorial Church to give a sermon on the troubled lives and deplorable living conditions of youth in Americas inner cities. The show, featuring videotape and choral accompaniment, cost more than $5 million to create. While some reviewers were entertained, others reportedly were offended by Esprits tactics. Nevertheless, the company reported that the line had generated $13 million in sales.

Financial Struggles and New Leadership

Soon thereafter, however, Susie Tompkins stepped down, or was forced out, as creative director of Esprit. In formal statements both she and the company contended that she was leavingas her ex-husband Doug hadto focus on her outside interests. Despite her lack of corporate title at Esprit, Susie remained involved as an advisor and consultant. From a public perspective, Esprit may have fumbled, but the damage was recoverable. More telling of things to come was the state of the financial end, which was described as a disaster by industry analysts and insiders.

Forced to restructure its loans in 1992, Esprit saw a succession of CEOs and fashion failures. In 1993, the company made a short-lived foray back into the mail-order business with a catalog devoted to the Esprit Ecollection. Although loyal Esprit buyers seemed willing to spend $18 for an organic cotton t-shirt, the catalog alone was not enough to change the companys fortunes. In 1994, on a whim, the company picked up the master apparel license for Dr. Seuss and produced a few t-shirts and hats to sell in Esprit boutiques during the holiday season. Intended for the childrens market, the Dr. Seuss items were wildly popular among adults and served as the one bright spot in the companys mid-1990s slump. Meanwhile, Esprits U.S. sales shriveled from $360 million a year to about $200 million.

Then, in 1996, Jay Margolis, a former vice-chairman at both Tommy Hilfiger and Liz Claiborne, came to the helm. Backed by Oaktree Capital of Los Angeles and Cerberus Partners of New York, he bought Esprits defaulted loans for $80 million dollars, severing Susie Tomkinss fiscal ties to the company. Although Tomkins and Esprit de Corp. would wrangle over tax indemnities issues in legal battles drawn out for years, the Margolis era had begun. Bolstered by a Womens Wear Daily poll which ranked Esprit as 28th in a list of 100 most recognized fashion brands, Margolis refocused marketing to attract a slightly older clientele, moving to more expensive fabrics and quality control. At the end of Margolis first year, Esprit had added ten shop-in shops in departments stores around the country and two retail stores, and, more significantly, had shown a profit for seven straight months.

In 1997, Margolis stepped up the pace of Esprits turnaround even further. The company started by announcing a new catalog, a tool for consolidating Esprits made-over image as modern and sophisticated, yet distinctly fun. Margolis expressed hope that the catalog might follow in the footsteps of Esprits ground-breaking catalog of the 1980s. Unafraid to use what had proved to work in the past, the company added 14 new retail stores that retained signature design elements, such as exposed ceilings, industrial lighting, and stained concrete floors. In a bold, new move, however, Esprit de Corp. purchased Moonstone Mountaineering, Inc., a manufacturer and distributor of technical performance apparel and sleeping bags. Further consolidating its active-oriented sportswear products, Esprit also made a licensing pact with Beach Patrol Inc., to gain immediate entry into the highly specialized swimwear industry.

The late 1990s saw further diversification of Esprits product line as the company looked into adding menswear, sleepwear, and intimate apparel. The end of the decade also saw market diversification as Esprit established itself in e-commerce. In celebration of its 30th year anniversary in 1998, Esprit launched an on-line store. The Dr. Seuss merchandise earned an Internet site of its own, at www.seusswear.com, and Esprits subsidiary, Moonstone Mountain Equipment, earned a Gold Award in the World Wide Web/On-Line Advertising category from SF Interactive, a digital marketing agency.

Esprit stepped up efforts to diversify the age of its consumer base as well. In 1999, it launched the I Am Esprit advertising campaign, a series of close-up shots of customers ranging from women in their 40s to 12-month-old infants. The ads were featured in established trade publications and in wild postings, on construction sites and vacant store fronts to reach middle-aged and junior consumers. The campaign was well-received as were most of Esprits attempts to reinvigorate itself under Margolis tutelage. By the end of the 1990s, Esprit de Corp. seemed to have recovered its lost market share and to have assured its place among a new generation of buyers. The company continued to open new stores, and the speed with which the new Esprit catalog grew to become a $15 million dollar operation left even the tongue-wagging fashion industry speechless.

Principal Subsidiaries

Moonstone Mountain Equipment.

Further Reading

Benson, Heidi, Reinventing Esprit, San Francisco Focus, February 1991.

Catching the Spirit at Esprit: The Tompkinses Go to Riches with Rags, Money, July 1986, pp. 56-57.

Carlsen, Clifford, Esprit Dressed to Thrill, San Francisco Business Times, January 27, 1997.

_____, Suiting Up: Esprit Dives into Swimwear Market, San Francisco Business Times, December 8, 1997.

Dorrans Sacks, Diane, Always True in Her Fashion, Metropolitan Home, September 1992.

Dobbin, Muriel, Fashion by Esprit, Baltimore Sun, May 30, 1985.

Esprit back on the Catalog Scene, Catalog Age, June, 1993, p. 39.

Ginsberg, Steve, Getting Serious, Los Angeles Times, March 6, 1992.

_____, Susie Tompkins Battles Esprit, San Francisco Business Times, September 15, 1997.

Greenberg, Freddi, The Greening of Esprit, Working Woman, October 1985, p. 110.

Itow, Laurie, The New Color at Esprit: Red, San Francisco Examiner, March 1, 1987.

Joi dEsprit?, California Business, May 1, 1987.

King, Ralph, Jr., How Esprit de Corp. Lost Its Esprit, Forbes, March 21, 1988, pp. 91, 94.

Klensch, Elsa, Making It Work! Susie Tompkins, the Spirit in Esprit: An Interview, Vogue, August 1987, pp. 344, 376.

Marlow, Michael, Susies Esprit: New Looks, New Outlook, Womens Wear Daily, September 10, 1990, pp. 1, 6-7.

McGrath, Ellie, Esprit: The Sequel, Working Woman, September 1991, pp. 67-69.

Miller, Cyndee, Seuss Characters Leap from Page into Licensing World, Marketing News, April 14, 1997, p. 2.

Miller, Paul, The Return of a Catalog Icon, Catalog Age, September 1, 1997, pp. 6, 38.

Rapp, Ellen, The War of the Bosses, Working Woman, June 1990, pp. 57-59.

Rapaport, Richard, Goodbye Susie: The Rise, Fall and Repositioning of Esprit and Its Founders, California Business, September 1, 1992.

Smith, Matt, Esprit de Court, http://www.sfweekly.com, October 8, 1997.

Underwood, Elaine, Reinventing Esprits Core, Brandweek, May 13, 1996, p. 35.

Waldman, Peter, Flagging Spirit: Esprits Fortunes Sag as Couple at the Helm Battle Over Its Image, Wall Street Journal, March 16, 1988, pp. 1, 17.

White, Constance C. R., Susie Tompkins: Crossing a New Bridge,Womens Wear Daily, March 10, 1993.

_____, Tompkins Gets Her Line, Womens Wear Daily, March 2, 1992.

Tina Grant

updated by Shannon Hughes

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"Esprit de Corp.." International Directory of Company Histories. . Encyclopedia.com. 10 Dec. 2017 <http://www.encyclopedia.com>.

"Esprit de Corp.." International Directory of Company Histories. . Encyclopedia.com. (December 10, 2017). http://www.encyclopedia.com/books/politics-and-business-magazines/esprit-de-corp-0

"Esprit de Corp.." International Directory of Company Histories. . Retrieved December 10, 2017 from Encyclopedia.com: http://www.encyclopedia.com/books/politics-and-business-magazines/esprit-de-corp-0

Esprit de Corp.

Esprit de Corp.

900 Minnesota Ave.
San Francisco, California 94107
U.S.A.
(415) 648-6900
Fax: (415) 641-5964

Private Company
Incorporated: 1968
Sales: $900 million
Employees: 1,200
SICs: 2331 Womens/Misses Blouses & Shirts; 2335 Womens/Misses Dresses; 2339 Womens/Misses Outerwear Nec; 3144 Womens Footwear, Except Athletic; 3171 Womens Handbags and Purses

One of the most successful companies in the fashion industry, Esprit de Corp. designs, manufactures, and distributes sportswear for women and children in over 35 countries. More than two-thirds of the companys total sales volume is generated by international sales. In addition to marketing clothing, footwear, and accessories, Esprit seeks to foster social responsibility among its customers. Through advertising and corporate programs, the company shows its commitment to such causes as AIDS awareness, feminism, and environmental conservation.

Esprit was built primarily by Doug Tompkins and Susie Tompkins, a husband-and-wife team whose personal and political values informed the companys business strategy. The couple met outside Lake Tahoe in 1963, when Susie Russell offered the hitchhiking Doug Tompkins a ride in her Volkswagen. Both Susie and Doug were from wealthy backgrounds and had dropped out of high school to explore more Bohemian lifestyles. After several months of travel together in Mexico and the western United States, they married and settled in San Francisco. There they embraced the social causes and fashions of the citys active counterculture.

In 1964 Doug, an enthusiastic skier and rock climber, invested $5,000 to start a retail business devoted to mountaineering equipment. Called North Face, the store was established in a prime location across from San Franciscos popular City Lights Book Store, and it soon became very successful. Because of his capable staff who oversaw daily operations, Doug was able to spend much of the year on international rock climbing and skiing expeditions. Susie remained in San Francisco, raising the couples two children and occasionally assisting at the North Face store.

During this time, Susie Tompkins became interested in a business venture proposed by her friend Jane Tise. Together they formed the Plain Jane Dress Company, which offered puffed-sleeve, acrylic minidresses that Tise designed and Susie distributed. After the Plain Jane dress line became successful locally, it was marketed to New York department stores by Allan Schwartz, a salesperson who became a partner in the company. Late in the 1960s, having sold the North Face operations for approximately $50,000, Doug Tompkins joined Plain Jane as a partner. While Tise and Susie designed the product and added new designs and labels to their popular line, Doug and Schwartz handled the marketing and sales responsibilities, targeting affluent California households with colorful, oversized catalogs.

By 1970 Plain Jane had sales exceeding more than $1 million a year. Doug and Susie Tompkins owned roughly 45 percent of the company, while Tise and Schwartz held the other 55 percent. At this time, some observers allege, Doug Tompkins stepped up his interest in the company, making bold decisions concerning the companys direction and professing an interest in taking charge. He was instrumental in steering the companys focus to more contemporary designs as the American hippie look subsided. In 1972, after he and Susie visited several countries in Asia, Doug decided to move manufacturing operations to Hong Kong, where clothing could be produced less expensively.

Schwartz and Tise sold their shares to the Tompkinses in 1976. Although Schwartz left the company immediately thereafter, Tise remained as chief fashion designer until 1979, when she reportedly became dissatisfiedas Schwartz hadwith the lack of input allowed her by the Tompkinses. That year Susie took charge of the design department. By this time the company had expanded its product line under several different labels to include pants, blouses, and skirts. These different divisions of the company were soon reorganized and consolidated, and Plain Jane was renamed Esprit de Corp. The companys trademark loose-fitting casual designs in bold colors caught on, and Esprit rapidly evolved into one of the most popular clothing companies among 18- to 24-year-old women.

During the early 1980s Esprit swiftly expanded and distinguished itself in the business community through both its sales and the way in which it reflected the eclectic tastes of Susie and Doug Tompkins. An art and architecture enthusiast, Doug Tompkins spent a great deal of time and money to renovate the San Francisco winery that would become the companys new headquarters. Featuring skylights, wood floors, and Amish quilts on the walls, the brick building gained national recognition among architects and interior designers. The facility offered Esprit employees access to tennis courts, a running track, and a trendy cafe. Seeking to create an enjoyable work atmosphere to match the spirit of Esprit clothing, the Tompkinses encouraged employees to dress fashionably yet casually; high heels were not permitted on the easily scuffed wood floors of the headquarters building. Furthermore, the Tompkinses offered a unique benefits package. In addition to a 52 percent discount on Esprit clothing, employees received subsidized tickets to the theater, ballet, and opera, as well as free vacations in the mountains and foreign language lessons. Employees came to refer to the workplace as Camp Esprit and Little Utopia.

From 1979 to 1985 the companys sales increased from $120 million to $700 million. As design director, Susie approved all drawings and fabrics, while Doug held the titles of president and image director. During this time, Esprit became the first clothing company to require department stores to relegate a part of their sportswear section specifically for use as a shop within a shop. While the concept called for a relatively large amount of floor space, expensive track lighting, and signs, many department stores complied because of the Esprit lines high sales volume. Catalogs also served as an important marketing strategy in the early 1980s, and oversized, glossy booklets featured pictures of employees and other real people modeling Esprit clothes alongside quotes of their personal philosophies. In an interview Doug Tompkins asserted that the Esprit customer is of above-average intelligence and knows the difference between substance and superficiality. Women who wear Esprit, he concluded, are the new feminists.

Between 1984 and 1986 the company borrowed nearly $75 million to open several retail stores, the first of which was a superstore in Los Angeles that showcased Doug Tompkinss taste and cost about $15 million to build. Subsequent stores were established in New Orleans, San Francisco, and Aspen, Colorado, and by 1987 there were 14 Esprit retail stores nationwide. Department store owners carrying Esprit clothing regarded these retail outlets as unfair competition, but the company disagreed.

As Esprit grew, however, some critics charged that the company was overextending itself. In late 1986 and 1987, Esprit experienced losses for the first time in its history. Earnings fell from $62 million to $10 million, representing an 83 percent downturn. Several reasons were given for the abrupt reversal. The San Francisco Examiner suggested that competitors were copying Esprit designs and offering them at lower prices and reported that some retailers complained about the inferior quality and design of new lines. The Tompkinses maintained that while the company may have tried to expand too rapidly, its spring lines were selling well. They pointed to the decline of the U.S. dollar as the primary reason for the companys losses. Furthermore, they maintained, while international sales were escalating, Esprits foreign operations were jointly owned with local investors so that profits were reinvested in the foreign market.

In 1986 Doug Tompkins turned Esprit over to Corrado Federico, who became the companys president, while Doug remained as Esprits CEO and chairperson. Exploring ways to cut the companys costs and consolidate its operations, Federico implemented a freeze on hiring and bonuses that year. Although employees were soon required to pay for coffee and phone calls made in the office, the Tompkinses ensured that some of the unique benefits that made up Esprits image as a fun, creative workplace remained. The following year the Esprit work force was cut by 30 percent, and Doug Tompkins brought in experts from rival fashion companies to manage the newly consolidated divisions.

It became apparent, however, that Esprit was experiencing personal conflicts that were leading to the companys decline. Critics cited both Esprits failure to stay abreast of fashion trends as well as irreconcilable differences that had developed between Susie and Doug Tompkins as reasons for the companys troubles. The Tompkinses had begun to argue about what direction the company should take. Susie regarded the companys image as too young, maintaining that customers were seeking a more sophisticated look. She realized Esprits original customers had grown up and wanted to introduce a line of corporate wear for the loyal Esprit buyer. Doug, on the other hand, argued that the companys youthful image was too important to change and that corporate women would not purchase Esprit. The couple subsequently became estranged.

In March of 1988 the Wall Street Journal reported on the rift between the Tompkinses. While the column focused on the couples relationship and Dougs alleged extramarital affairs with women in the company, it also reported that weak financial management and the design departments failure to note the fashion worlds shift to a more traditional look were hurting business. In addition, interviews with former Esprit employees revealed that tension in the workplace was being fostered by two factionsthose who sided with Doug and those in Susies camp. The article also revealed that Doug was seeking minority equity partners to help maintain the struggling Esprit retail stores.

When Susie Tompkins petitioned a San Francisco court to appoint a third director to help run Esprit in March 1988, a judge advised that she and her husband resolve the situation without legal intervention. The following month, hoping to the reverse the stalemate, the Tompkinses appointed three new directors, Peter Buckley, Isaac Stein, and Robert Bartlett, to turn Esprit around. By May of that year the new board recommended that Susie and Doug each remain 50 percent owners of Esprit but that they give up their operating control of the company. Under the plan Esprit president Federico became chief executive officer. Doug was given the title of chief executive officer of Esprit International operations and was required to abandon the idea of expanding Esprits retail establishments through outside financiers. While many of Dougs duties at Esprit remained the same, Susies role at the company changed dramatically. No longer the chief fashion designer, she was effectively out of the business. As a fashion consultant to Esprit she kept in close contact with the management team, but announced that she would spend time away from Esprit, concentrating on her volunteer work for such social causes as AIDS awareness. Early in 1989, Susie and Doug Tompkins filed for divorce.

That year Doug pursued his growing interest in environmental conservation within the parameters of the fashion industry by instituting a new marketing strategy in which the company actually advised the customer not to buy Esprit clothing if she did not need it. Doug argued that consumerism in general, and especially in the fashion industry, was leading to the destruction of natural resources and that Esprit should thus introduce clothing that would outlast the seasonal fads. Dougs buy only what you need campaign included hang tags with the warning on each article of clothing, as well as a new line of fashions in more traditional, muted colors. Initially the line was profitable, but it eventually declined, and, during this time, critics noted that Doug seemed to be more interested in ecology than fashion.

While Esprit had recovered from the previous two years losses, the company was still regarded as unsteady and lacking a corporate vision. In July of 1989 Esprit announced a new plan to refocus Esprit under one Tompkins. Doug was given the option to buy out Susies 50 percent within 120 days of the agreement. If he did not, both halves of the company would go up for sale at an auction. Clothing and footwear manufacturing giants Benetton and Reebok became interested in acquiring Esprit, when, after the requisite 120 days, Doug had not exercised his option.

Analysts speculate that by forcing the auction of the company Doug had initially hoped to acquire Esprit for a lower price than he would have paid to buy out Susies share. However, as Reebok and Benetton became interested in purchasing Esprit, the price would have escalated. Furthermore, during this time, Susie was recruiting financial backing from the venture capitalist Bruce Katz, Esprit head of Far East operations Michael Ying, and Isaac Stein. One day before the bidding on Esprit was to close, Doug and Susie worked out a deal and Esprit never went to auction. Industry observers believed that Doug had been concerned that both he and Susie would lose the company to higher bidders, and, in order to keep Esprit in the family, he accepted Susies offer in return for some interest in the companys international division.

Susie Tompkins returned to head Esprit amid much publicity. Trade journals, newspapers, and magazines depicted her as the victor in the war to control Esprit. Some observed, however, that the recession of the early 1990s could prove particularly challenging for the company and her leadership. Under Susies ownership, Stein was named Esprits chairperson. Federico remained president until his resignation in April of the following year; Stein subsequently assumed the presidency. Appointing herself creative director, Susie brought back the design team with which she had worked before leaving Esprit in 1988. Expressing the desire to produce casual fashions that exuded social awareness, she stated that her mission was to ensure that Esprit inspire good values.

In 1991 the recently appointed image director, Neil Kraft, produced the What would you do? advertising campaign that surveyed young people about how they would like to change the world. The $8 million campaign featured quotes from Americas young people on such global concerns as racism, abortion, and environmentalism. Although the advertisements won several awards and generated a great deal of media attention, sales figures were nevertheless disappointing. The following year Kraft left Esprit, and his duties were taken over by Fritz Ammann, who was named chief executive officer while Stein remained chairperson.

Pursuing her goal of promoting a socially responsible work force, Susie Tompkins replaced the employees free vacation program with a lunchtime lecture series featuring controversial figures speaking on current issues. She also established a volunteer program that paid Esprit employees for working ten hours per month at a nonprofit organization, providing that the employee matched that amount of time on his own. Furthermore, the ecological soundness of Esprits manufacturing practices was monitored by a new environmental and community affairs department in the company called the Eco Desk.

The Ecollection line of Esprit clothing and accessories, touted as both ecologically sound and fashionable, was introduced early in 1992. The line featured buttons made from reconstituted glass or carved from nuts, organically grown or vegetable dyed cloth, and purses handwoven in a Mexican cooperative. Also that year Susie introduced the adult clothing line she had conceived years before. Tompkins referred to the designs as creative career wear for the Esprit customer who had matured. The tailored trousers, sophisticated, pleated skirts, jackets, and vests were manufactured in earth tones such as plum, green, brown, and burgundy. Tompkins maintained that these clothes were functional as well as fun and appropriate for the business world. The unconventional fashion show at which the Susie Tompkins collection debuted received mixed reviews. Rather than provide a runway and models, Susie commissioned Reverend Cecil Williams of San Franciscos popular Glide Memorial Church to give a sermon on the troubled lives and deplorable living conditions of youth in Americas inner cities. The show, featuring videotape and choral accompaniment, cost more than $5 million to create. While some reviewers were entertained, others reportedly were offended by Esprits tactics. Nevertheless, the company claimed that the line generated $13 million in sales.

During the year, however, Susie decided to step down as creative director of Esprit. In formal statements both she and the company contended that she was leavingas her ex-husband Doug hadto focus on her outside interests. Despite her lack of title at Esprit, Susie remain involved as an advisor and consultant.

Having focused on downsizing its operations and containing costs, Esprit continues to achieve profits, and its sales in department stores as well as in more than 30 Esprit retail and franchise stores have recovered since the late 1980s. Furthermore, good relations between management and employees at Esprit have been restored. Analysts now speculate that the future success of the company will depend on its ability both to follow and influence the quickly changing fashions in womens sportswear.

Further Reading

Benson, Heidi, Reinventing Esprit, San Francisco Focus, February 1991.

Catching the Spirit at Esprit: The Tompkinses Go to Riches with Rags, Money, July 1986, pp. 5657.

Dorrans Sacks, Diane, Always True in Her Fashion, Metropolitan Home, September 1992.

Dobbin, Muriel, Fashion by Esprit, Baltimore Sun, May 30, 1985.

Ginsberg, Steve, Getting Serious, Los Angeles Times, March 6, 1992.

Greenberg, Freddi, The Greening of Esprit, Working Woman, October 1985, p. 110.

Itow, Laurie, The New Color at Esprit: Red, San Francisco Examiner, March 1, 1987.

Joi dEsprit? California Business, May 1, 1987.

King, Ralph Jr., How Esprit de Corp. Lost Its Esprit, Forbes, March 21, 1988, pp. 91, 94.

Klensch, Elsa, Making It Work! Susie Tompkins, the Spirit in Esprit: An Interview, Vogue, August 1987, pp. 344, 376.

Marlow, Michael, Susies Esprit: New Looks, New Outlook,

Womens Wear Daily, September 10, 1990, pp. 1, 6-7.

McGrath, Ellie, Esprit: The Sequel, Working Woman, September 1991, pp. 6769.

Rapp, Ellen, The War of the Bosses, Working Woman, June 1990, pp. 5759.

Rapaport, Richard, Goodbye Susie: The Rise, Fall and Repositioning of Esprit and Its Founders, California Business, September 1, 1992.

Waldman, Peter, Flagging Spirit: Esprits Fortunes Sag as Couple at the Helm Battle Over Its Image, Wall Street Journal, March 16, 1988, pp. 1, 17.

White, Constance C. R., Susie Tompkins: Crossing a New Bridge,
Womens Wear Daily, March 10, 1993.

White, Constance C. R., Tompkins Gets Her Line, Womens Wear Daily, March 2, 1992.

Tina Grant

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"Esprit de Corp.." International Directory of Company Histories. . Encyclopedia.com. 10 Dec. 2017 <http://www.encyclopedia.com>.

"Esprit de Corp.." International Directory of Company Histories. . Encyclopedia.com. (December 10, 2017). http://www.encyclopedia.com/books/politics-and-business-magazines/esprit-de-corp

"Esprit de Corp.." International Directory of Company Histories. . Retrieved December 10, 2017 from Encyclopedia.com: http://www.encyclopedia.com/books/politics-and-business-magazines/esprit-de-corp