“Rusty knows The OC”

Various surf boards at Huntington Surf and Sport in Huntington Beach including this non-foam Rusty board of San Diego made by Aviso, which is a hollow, carbon fiber board.
MARK RIGHTMIRE

BACKGROUND

Rusty parted ways with Irvine-based La Jolla Group, the licensee for the North American operations, at the end of last year.

 

Rusty has moved offices to Laguna Beach and is working under new licensee Happy Shovel, which includes investors from Australia. The new collaboration allows for the U.S. operations to tap into overseas designs and ideas, including plans to bring back the women’s line.

BACKGROUND:

Rusty parted ways with Irvine-based La Jolla Group, the licensee for the North American operations, at the end of last year

Rusty has moved offices to Laguna Beach and is now working under new licensee Happy Shovel, which includes investors from Rusty Australia. The new collaboration allows for the U.S. operations to tap into overseas designs and ideas, including plans to bring back the women’s line.

Charlie Setzler’s new Rusty office faces Laguna Canyon Road, cars whizzing by as they head in and out of the small beach town.

Decades-old framed posters featuring the iconic Rusty logo have yet to be hung in the chief executive’s office. Unpacked boxes with gear line the floor; a surfboard with the well-known R dot logo greets visitors at the entrance.

It’s been two months since Rusty North America parted ways with Irvine-based La Jolla Group, which since 2007 held rights to license the apparel brand.

“When the agreement to separate from La Jolla Group happened, it was a no-brainer for me to continue with the brand,” Setzler said. ”I wanted to finish what I started.”

Rusty’s split from La Jolla Group is part of a growing trend in the surf industry, with bigger companies selling or parting ways with smaller operations to instead focus on their larger brands. Smaller brands in turn must start a new chapter without the help and critical financial backing of a parent company.

Happy Shovel, a group of investors that includes Rusty’s owner, Vegas Enterprises in Australia, is the company’s new licensee. The connection to Australia should play a key role in tapping global trends. Rusty is one of the top five surf brands in Australia, Setzler said. While the brand has a strong account base in the U.S., it’s not at the same level as it is in Australia.

Dave King, analyst for Newport Beach-based Roth Capital Partners, said Rusty would benefit from a singular focus.

“Rebuilding brand equity in the industry and marketplace will take time, so hopefully Rusty is committed to a coherent strategy and message, and Happy Shovel will be careful to not dilute the brand through overdistribution,” King said.

One of the first calls to action for Setzler and Rusty was to bring back the women’s brand, which was cut in 2012. The line will be released this fall in stores…

Laylan Connell,OC Register