Sew Cute

by Julia Lynam

A strong design vision keeps the Belenkys in stitches

In 1991, Uli and Michael Belenky left their Greenwich Village apartment in New York City and moved their two-year-old children's clothing design business, Zutano, to a dilapidated farmhouse in Cabot, near Michael's hometown.

It's the last word in the Spanish dictionary and it may very well be the last word in children's clothing: Zutano. Its distinctive style is worn by fashion-conscious babies in every state of the union, thanks to the brand's presence in more than 1,000 independent boutiques nationwide.

No mail order; more than a thousand small customers: This unusual marketing strategy typifies the Zutano approach. "We really treasure the independence that we have," explains Michael Belenky, co-founder with his wife, Uli, of the Cabot-based children's clothing company.

In the last two years, Zutano has seen 20 percent growth and serves more than 1,000 customers nationwide. Natalya Zahn (left) is a graphic designer; Julie Belkus is a technical designer. Company co-founder Uli Belenky watches from behind the partition.

"Because of the relationship we've built up with independent retailers since 1989, we've been able to grow the company even while they have been under pressure from the market," he continues. With our independence, we can decide our direction and what we want to do, so we've always been design driven. If we were under a larger house catering to a mass market, we would have to do, for instance, whatever they say is the color of the day."

Instead, Zutano is driven by the strong design vision of Uli Belenky, who found when her own thoughts first turned to nest-building that there was very little good quality, creative baby apparel on the market she was sure there had to be something beyond pink, blue and yellow.

Uli started designing and sewing simple baby clothes in soft cotton fabric and a new range of colors, and the company was born, operating out of the Belenkys' Greenwich Village apartment, with Michael hand-delivering the clothes to small specialty stores inthe city. They found a ready market just round the corner. One of their first and current customers was Ibiza, a women's boutique that attracts a celebrity clientele: Susan Sarandon, Woody Allen, and David Bowie's wife Iman have all shopped for Zutano clothing there. Michael attributes their success to their fresh approach, saying: "Often, people can do the best work in industries where they can step in with another experience. With Uli's background in architecture, sculpture and art, she was able to bring a different view."

In 1991, the couple moved their business, and their new daughter, Sofia, about as far away culturally as they could get from Greenwich Village to a dilapidated farmhouse in Cabot, close to Michael's hometown, Marshfield.

Now tastefully restored and flanked by renovated and newly built office and design quarters, that farmhouse is the hub of a growing empire of well-turned-out babies and delighted parents. More than that, Zutano is a company with a human touch, embracing retailers, manufacturers and staff as partners in a mission of offering fun kids' fashion combined with simple comfort and style.

Michael's own career in photography meshed neatly into producing Zutano's bright and appealing marketing materials, and a spacious, well-equipped studio in the Cabot complex allows him to photograph babies and toddlers in infinite combinations of mix-and-match cotton prints and plains in sometimes quite unexpected colors.

Their "Baby Basics" core line is manufactured by a Hong Kong company in the Chinese city of Macao. "When we started we did sampling in the U.S., but it didn't come close in quality," Uli says. "We've been working with a small family company in Macao for over 13 years now. They do the whole production process: sourcing the fabric, printing and dying it, ordering buttons and labels and actually sewing the pieces.

"We send them the designs; they make screens and send us swatches. The process goes back and forth a couple of times until we have the right shade, but because we've been doing it for so long with the same people we have color standards, and it gets easier every time. In the beginning we sometimes had trouble getting a shade right. I remember being at a trade show where I had to hand-paint a flower. People would come up and feel it it was as stiff as cardboard, but no one said anything, they ordered anyway and we came through with the goods on time!"

Johnny Chen runs the Macao operation, employing more than 60 people in the office and factory. "We've been developing the quality and quantity of production with Zutano very quickly over the past years, and we've learned a lot from them that has helped us to improve our production. Since we started to do business with them, our factory has grown, and we have had to take on more staff."

He says his staff is always mindful of the high quality of work demanded by Zutano, adding, "We do our best to keep the babies and their mothers smiling."

Roddy Story, proprietor of The Children's Stores in Nashville, Tenn., and Atlanta, Ga., has been stocking Zutano for 12 years."Zutano is unlike any other company in the industry," he says. "When we first saw their line in New York City we were taken by their attention to detail.That first impression has been reinforced time and again as they continue to be on the short list of industry innovators. They're always on the lookout for ways to improve, seeking things that are new and asking for feedback from their customers.Not only is Zutano a leader in the industry, but they are an absolute delight to work with and we count them as great friends and business partners."

Zutano has a small company store on Main Street in Montpelier, where feedback is sought from customers. Katie Jones (left) and Sylvia Thompson are retail associates; Amanda Gravel does customer service.

The Children's Stores were invited to test "The Wonder Box," a signature Zutano display stand designed to enable retailers to present Zutano products with panache. "The Zutano crew had worked on this for an extremely long time, making sure the fixture was functional, the right size, easy to change or expand, and that it appropriately showcased their line," says Story."This paid off big time because it enabled Zutano to establish more formidably its brand the fixture is clearly Zutano and to make its product really stand out. This presentation is so good that we put it in a central part of our store and it elevates the aesthetics of our entire operation."

Building strong personal relationships with manufacturing and retail partners has helped Zutano blossom, and the company has grown in almost every year since it was established in 1989. In the last two years, says chief operating officer Steve Kandrac, it experienced 20 percent growth. "In this economy," he says, "That speaks well of our success in developing a brand and being able to invest in infrastructure so that we can satisfy our customers. Once you have a brand, you need to be able to execute strategy, and to do that, we've expanded the infrastructure and recruited people with more technical expertise."

A small company store in Montpelier established Zutano on the local market and brought feedback from customers, leading to new lines for older children. Zutano makes clothing up to size 4, but its spring 2005 collection will go up to size 6 in direct response to requests from parents shopping in Montpelier.

In 2002 Zutano moved its complicated shipping operation, serving more than 1,000 customers nationwide, to a dedicated shipping center in East Montpelier and recruited Nancy Werner to run it. "Nancy had been quality control manager for a large women's apparel house; she came aboard with a lot of experience and helped us to take our distribution to a very sophisticated level," says Michael."

In 2002, Zutano moved its complicated shipping operation to a dedicated shipping center in East Montpelier and recruited Nancy Werner to manage it. Vincent Churchill is a distribution center associate.

Unusual for the apparel business, the Belenkys find they can keep its distribution team busy all year, not just at spring and fall peaks, because baby wear is always in demand. The predictability and the steadiness of the business have also enabled their partners in Macao to build a whole business around Zutano's Baby Basics collection, hiring and retaining long-term employees and not having to seek additional clients to fill in seasonal gaps. The more seasonal nature and different fabric requirements of the new lines for older children have led Zutano to more recently use a number of other specialist factories, also in Macao.

Back on the home front, they've attracted attention for their "baby project," in which babies are invited to accompany their parents to work at Zutano every day for the first year of their lives. This is only the most visible manifestation of the company's commitment to social responsibility. Members of Vermont Businesses for Social Responsibility, the Belenkys believe in walking the walk: providing good benefits and working conditions for staff, including a gleaming kitchen and café space for afternoon breaks at Cabot, and even 12 annual "dog days" when staff can bring their dogs to work. They support the local community by offering scholarships to students from Cabot's K-12 public school, and the wider community by donating clothing to disaster relief programs and supporting an international program for children in distress as well as maintaining a relationship with an orphanage in Haiti.

Like a baby, Zutano continues to grow and change: "We feel there is a tremendous amount of potential for growth in the specialty world; it's become a really strong brand and we'd love to keep developing it and moving to the next level," says Michael. "There's definitely a lot more that we could do."

Originally published in November 2004 Business People-Vermont