Everlane, which built its business by offering beautiful basics like t-shirts and denim-and-leather backpacks for less than $100, is about to test customers' appetites for higher-end — and higher-priced — products.
The company unveiled a collection of simple, luxe leather totes in three sizes on Tuesday. The smallest, called the Shopper, costs $325 (pictured below, top left), the Market costs $365 (below right) and the largest, Portfolio, costs $425 (bottom center). They come in three colors: black, brown and a a lighter brown called kiwi. Created in Italian factories, the totes are made out of Italian leather, and include adjustable straps and four metal studs on the bottom. The interior, lined with ultra suede, features two deep inside pockets. Some of the totes bear a small Everlane logo at the bottom; others are devoid of branding.
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Michael Preysman, founder and CEO of Everlane, insists that if the totes were sold at Barneys, they'd be next to Celine's coveted bags, which cost upwards of $1,000. So how is Everlane able to offer such quality for less? By cutting out middle men like retailers, operating on a modest marketing budget and streamlining product development.
"A traditional fashion brand, like an Alice and Olivia or a Tory [Burch], will design 400 or 450 items, the merchandisers will select 250, five are produced and maybe one is a bestseller," Preysman explains. "Our approach is to find one or two items that matter, test with the consumer and distribute directly to the consumer."

Everlane's big challenge, however, will be convincing shoppers that they're getting a good deal by purchasing bags that would retail between $1,000 and $1,500 for a fraction of the price. Preysman says the company started out by offering basic t-shirts rather than accessories because it could convey its value proposition better that way. People have a sense of what t-shirts are worth, and they don't understand why some "high-end" t-shirts have such crazy markups. With handbags, it's more difficult to understand value, he says.
Everlane has more high-end products on the way. Next Monday, the company will introduce made-in-Scotland cashmere sweaters.
One thing the company doesn't intend on doing anytime soon is discounts. "It's a dangerous road to go down," Preysman says. "We always underbuy so that we don't have to discount."
Everlane's ambitions are big. It doesn't plan on remaining a cool, niche brand, Preysman says. But he also dismissed the idea of being the next Gap or J.Crew — though it's clear he'd like to rival their size some day. Preysman simply says he'd like the company to reach and mean something to as many people as possible, hence its focus on basics.
Image: Everlane