Businessman Focus – Active USA’s Don Lee

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Korean-American apparel businesses took a huge hit
Lack of power cornering Korean businesses again
A new route to instill prosperity is urgently needed

Active Lee president Don Lee poses in front of his Pico Showroom office in Downtown Los Angeles.

“I can now sit back with my wife with a glass of wine. I’ve recovered somewhat over the last 25 years. I’ve become rather dull to it, but…”

The pain from 25 years ago to Don Lee, the chairman of a large apparel business Active USA, still remains vivid in his memory. It is not hard to imagine just how much he suffered when the business he has built for five years after immigrating to the United States from Korea collapsed entirely by the rioters. Korean-American apparel businesses took the biggest hit from the riots.

“History remembers April 29, 1992 as the day Koreans and blacks collided,” Lee said. “But it was presaged from the day before. Even the Korean radio station urged business owners to get off work earlier than usual as the feeling around the neighborhood just wasn’t right. It worried me, so I sent my employees home early and left the factory myself around 2 p.m. that day.”

That was the last time Lee saw his factory in normal conditions. Even in his wildest dreams, he did not think that he would see his factory burning down on television soon.

“Everything turned into ashes,” Lee said. “The factory that was worth $1 million, the materials, machines and clothes worth millions of dollars were gone too. Thankfully, no one was hurt, but I was devastated as I saw the riots unfold on television. I couldn’t even go to the factory as it was burning really badly.”

Lee’s factory was located on Main and 31st. It was one of the first buildings destroyed as the riots began. Lee said he lived the following six months of his life drinking heavily, mired in depression.

“I’m not sure how I would have turned out if it weren’t for my wife and people around me who encouraged me to recover,” Lee said.
Family and friends obviously helped, but Lee’s attention to detail while his business was still up and running helped great as well.

“After the riots, there was no way for me to prove my financial transactions as the invoices and receipts were all burned,” Lee said. “Some of our suppliers helped me out, giving me $500, $1,000. I also received a $500,000 funding on loan through insurance.”

Lee soon collaborated with his former customers and businesses he previously dealt with.
“Koreans say that the best place to light fire again is where the fireplace once existed,” Lee said. “Even though the riots have just ended, the economy was still going quite strong.”

Today, Lee runs a 60,000-square-foot showroom on Pico Boulevard in Downtown L.A. Active Pico Showroom was designated by the L.A. Business Journal as one of the properties to look out for in 2017.

However, the memory of the riots still haunts Lee. He is also worried that the same mistakes may take place again. A quarter-century has passed since, but Lee said that the ongoing trends in the apparel industry among Korean-Americans overlaps with what he saw in the early 90s.

“The apparel business in downtown is a struggle for every business owner now,” Lee said. “Since the FBI raid three years ago, Central and South American customers have been decreasing consistently. The new president’s anti-immigration policy is also forcing sewing factories out of Los Angeles.

Brands like Bebe and BCBG, which dealth closely with the Korean apparel businesses, have been pushed out by the likes of H&M, Uniqlo and Zara. The city government is running projects to improve the downtown economy, but the apparel business is still at a crossroads.”

While Lee understands that the slowing economy has affected the apparel industry, he also cautiously warned that the Korean business owners lacked the preparation to deal with such difficulties. He added that the Korean business owners simply lack the political power to establish themselves.

“The apparel industry in downtown has thrived for more than 30 years,” Lee said. “As long as you produced goods, there were places to sell them. Now, even Amazon is selling goods made by fashion brands. It’s difficult to react to that. The development projects in downtown has left apparel businesses helpless. It was also our lack of power in 1992 that gave us so many hardships after the riots. None of us could even ask for proper compensation. Even now, not much has changed as same mistakes are happening.”

Lee explained that the currently existing apparel businesses have to find a new path, just like how the previous businesses from the 90s rebounded from the riots. Although he admits that recapturing the booming era from 30 years ago may be difficult, hard work to improve the state of the industry could leave the businesses in a much better shape for future generations.

The first step, Lee said, is to converse with second generation businesspeople and young politicians. He predicted that if the first and second generation industry experts collaborated to utilize the experience of the older professionals with the youngsters’ way of communicating through social media, the potential to create the Silicon Valley of the fashion industry is definitely there. He suggested that such efforts could lead more young people to start businesses in the industry as well.

“First generation immigrants have retired, while the young people of the following generations are finding other ways to make ends meet,” Lee said. “I’m not saying that young people should run clothing businesses. The likes of Michelle Steele, David Ryu and Robert Ahn are great examples as politicians. If they can go on and form a wide network with an understanding that clothing businesses are the spine of Korean-American economy, our market could continue to grow.”

Lee is adamant that the Korean community “can and must” continue to strive for the betterment of their society.

“The riots emptied out our community,” Lee said. “Nothing was left afterwards. From there, we got back on our feet. The Koreans working in the clothing industry are strong minded as long as they choose to work together.”

-Don Lee
▶ Honorary doctorate degree in business management from Youngnam University ▶Daeryun High School graduate ▶BA in architecture from Youngnam University ▶Current San Pedro Fashin Mart Association chairman ▶Pacific Bank director ▶Saehan Bank Corp OB inaugural chairman ▶World Hansang Contest leading CEO ▶Gyeongsang Province’s honorary foreign advisor ▶Youngnam University reunion group inaugural chairman

By Moonho Kim