That fall, Temple answered a knock on the unmarked office door and found an elderly woman standing there. "I don't know what you do in there, but are you hiring?" the woman asked. She was 72 years old, and her name was--almost inevitably--Miss Daisy. Through tears, she explained that her husband had a heart condition and they could no longer afford his medication. "We've lost everything, and I just need a job really bad," she said.
Miss Daisy had never worked as a seamstress and had little or no experience cutting and sewing, but Temple agreed to hire and train her because she needed as many hands as she could get. Word got around Lexington that a new company had jobs, and one after another, people started showing up at the door asking for work. "Person after person, they'd tell the same story," Temple remembers. "I've lost my house, I've lost my car; what can I do?" She hired them all.
Temple tells this story in her bright, pastel-green office in one of the four buildings that now house the company. A 20,000-square-foot former medical-equipment warehouse, the headquarters facility opened in early 2012 after the state of North Carolina agreed to pay for half of the cost of buying and renovating it, to help boost job creation in the region. Manufacturing and design happen here, and next door a smaller building houses the company's photo studio. Across town sits an 80,000-square-foot warehouse and shipping hub. With about 250 employees, Lolly Wolly Doodle is now one of the largest employers in Lexington. At the rate it's growing, it could soon be the largest.
Increasingly, however, Lolly is not a local operation: The fourth location is in New York City, and a cadre of experienced retail and technology hands have climbed aboard, many recruited with the help of Shana Fisher. The COO, Emily Hickey, was a co-founder of the business-networking service Hashable and, earlier, a VP at HotJobs. The former e-commerce chief at Quidsi, the parent company of Diapers.com, now heads up Lolly's New York tech team. Recently, John Singleton, a former JCPenney and Abercrombie & Fitch executive, came on to build better supply chain and manufacturing processes. "Brandi is recruiting some of the very best people in the world," says Donn Davis, the co-founder of Revolution Growth and a member of Lolly's board since his firm's $20 million investment last year. "Most of the time, those people's first reactions are like mine when I heard about the company. It's called what? It's where? It sells what? Then they see what the company is doing, and they say, 'Wait, everybody is talking about trying to figure this out, but you're already doing it.' "
What Temple is really doing, says Davis, is "reinventing apparel much as Dell reinvented the PC industry. It's affordable custom [manufacturing] in real time with little inventory risk." Davis sees Lolly's Facebook commerce as an important tactic that kick-started the company, but it's just that: a tactic. The real innovation is using social media as the starting point for a new e-commerce model that's powered by a social feedback loop.
The cycle works like this: First, the company makes a sample product and puts it up on Facebook or another social platform for sale (the company is expanding to Instagram and will leverage Pinterest and other platforms soon). Then it makes only the sizes that people order, so there's no overstock. The company compares sales of that product with past styles and decides if it's a winner. If it is, two things happen: One, Lolly can mass-produce it and keep some of it on hand for sale on its own site, LollyWollyDoodle.com (even those garments are customizable with monograms and other touches, so customers are always getting something unique). Two, a winning design can become the basis for a new product "pod," an ever-expanding collection built on that template; new iterations might be tweaked with different fabrics or necklines or ruffles, but there's a limited palette of tweaks for any given pod, keeping manufacturing complexity to a minimum.
As the company cycles through this feedback loop, it amasses ever more data about what works, so that it can make smart design decisions and configure its operations accordingly. Social commerce, in other words, is not just about virality but also about predictive analytics. The company introduces about 15 new product SKUs every day, and one of the biggest priorities this year is to finish building custom software that better structures the design and sales data and allows the supply chain, cutting and sewing operations, and warehouse to be reorganized so that each piece of fabric moves through production as efficiently as possible.
If traditional garment manufacturing is a pretty straightforward assembly-line affair, the seamstresses at Lolly work more like short-order cooks in a diner where the menu changes daily. In one room, a dozen people cut fabric according to order tickets that flow through in real time--15 size-2 aqua chevron Charlotte dresses here, a single size-6 salmon Ruffle dress there. On the sewing floor, efficiency comes from how the orders are bundled (not necessarily by garment or size but, because many items share attributes, by the type of sewing required) and minimizing how many people or machines have to touch a garment. That information then informs the design process for new garments. A made-to-order dress now takes two weeks to land on a customer's doorstep; Temple hopes to shave that down to a week.
Hickey, the COO, calls Lolly Wolly Doodle a "fast-fashion" company, referring to the category of retailers, epitomized by the Spanish chain Zara, that constantly refresh their product lines according to trends and sell at low prices, with low margins. Fast fashion is largely immune to the slow seasonal cycles that drive traditional fashion companies--which inevitably have to rely on deep discounts to move unsold inventory--but it requires nimble manufacturing that can take on small product runs and constantly adapt to demand signals. When companies rely on remote mega-factories, they have much less control. "It's no small coincidence that Zara is not made in China," says Forrester's Mulpuru. "It's no coincidence that Lolly Wolly Doodle is made in the U.S."
Well, partly. Lolly Wolly Doodle these days outsources about 30 percent of its manufacturing to China and Latin America, but those garments are all the proven winners that emerge from the U.S.-made small runs that first appear on Facebook and the Lolly site. The Lexington warehouse has racks of premade blanks that were made overseas and await monogramming or other customization before being shipped.
"There's still going to be a level of imprecision in that system," Mulpuru cautions. "There are all kinds of early demand indicators that could be wrong. But your chances of picking a hit are going to be better, and you will have fewer markdowns." She finds it "truly baffling" that more companies haven't "got their heads out of their asses" and adopted a similar model to predict and make hits.