Wednesday, February 17, 1999

By Craig T. Kojima, Star-Bulletin
In addition to tourist-oriented shirts found in other locations,
the North Shore's Haleiwa store will feature surf, country and
fishing designs to appeal more to local residents.

Crazy Shirts
hopes Haleiwa store
is a good fit

The ailing company is wading
onto the North Shore after closing
15 outlets on the mainland

By Tim Ryan


Despite coming off its worse financial year in the company's 35-year history, Crazy Shirts has opened a new store in Haleiwa, its first on the North Shore.

"Opening a new store when the economy is depressed doesn't seem to make a lot of sense but we own the store space, have wanted a store in Haleiwa for some time, and been stuck with the building for a while because we couldn't find a tenant," said Rick Ralston, the company's founder and chairman.

The new store -- Crazy Shirts' first opening since 1997 on Guam -- is some much-needed good news for a company that last year had a 25 percent decline in sales, according to Ralston.

On the mainland, the company performed "so poorly," he said, that it closed 15 of its 30 stores, from California to New York.

"Our operations were not as refined on the mainland as in Hawaii," Ralston said. "We didn't have the customer-service level, trained people, creativity, product supply and the management was not together."

By Ken Sakamoto, Star-Bulletin
Crazy Shirts founder Rick Ralston stands in front of the Haleiwa store.

Randy Yeager, Crazy Shirts president and CEO, left the company earlier this year after moving to California to try to straighten out the mainland problems. His departure was "very amiable," a Crazy Shirts' spokeswoman said. Another factor for Crazy Shirts' poor year, said Ralston, was the large drop in Japanese customers in Hawaii and less spending by those who did visit.

After also closing its Kahala Mall store last year, the company now has a total of 42 stores: 15 on the mainland, 24 in Hawaii and three on Guam. It also operates one factory outlet in California and two in Hawaii. Crazy Shirts, which moved its headquarters to Tustin, Calif., from Honolulu in 1997, opened its first mainland store in 1973 in Southern California. Its last Oahu store opening was in 1995 at the Ilikai hotel.

Ralston said he has no plans to open another store here until Hawaii's economy improves. A major factor in Crazy Shirts' decision to open the Haleiwa store was being able to use the company's own labor force to renovate the 750-square-foot former antique shop at 66-030 Kamehameha Highway, saving the company hundreds of thousands of dollars.

Designing, building and furnishing a "typical" Crazy Shirts outlet costs about $300,000 to $400,000, Ralston said. Some interiors have cost as little as $150,000 while others as high as $950,000, he said. Ralston built his first store 35 years ago in the International Market Place for $300 to $500. "We knew we had a good maintenance department to build things, a visual merchandise staff that understands our stores and can design the interior. We have fixtures and materials left over from other stores and we have clothes," Ralston said.

Crazy Shirts' renovation budget for the Haleiwa store was $10,000, which Ralston said the company met. The company had shied away from Haleiwa because the number of possible customers was low compared to other areas in Hawaii, Ralston said. But the low overhead of the Haleiwa site justified the new store, he said.

Crazy Shirts has owned the building, originally a First Hawaiian Bank, for about seven years, paying $125,000, Ralston said.

Only one salesperson will work each shift and the store is open daily 10 a.m. to 6 p.m. The Haleiwa store, which opened last week, will carry some designs only available there, Ralston said.

The company expects the Haleiwa outlet to have annual gross revenues of about $350,000 which is "very small for us," Ralston said. He declined to give the average annual gross for a Crazy Shirts' store.

Crazy Shirts this year expects Waikiki sales to "stay down" and the Ala Moana store to break even, he said, adding that the company has seen sales increases at its neighbor island outlets and at Pearlridge. Unexpected sales are coming from local residents, which Ralston said have been "terrific." "I believe '99 will see us breaking even overall. I think the Hawaii and Japanese economy has bottomed out."

Ralston declined to say how much money Crazy Shirts lost in 1998, but said the company has been "liquidating about everything we own," including the Aiea sugar mill, and much of Ralston's vast antique collection.

"We got overconfident with the Japanese spending and . . . never thought it was going to end," Ralston said. "That was foolish.

"I never thought I could lose so much money in one year."

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