Forty years ago, manufacturers allocated limited coveted merchandise to his store. Today, they strive to sell more to the “lucky” designer/clothier.

By Laura D.C. Kolnoski

If the happiest entrepreneurs are indeed those who turn their passions into successful business ventures, count Frank Gunion among them. The surfer and International Relations major opened a small surfboard and swimsuit shop in Ocean City, Maryland at 18 because he saw a need. He has been using that intuition to propel his business forward since 1968. Today, that surf shack, still called South Moon Under, has evolved into a network of 24 sophisticated fashion-forward stores from Connecticut to Virginia, including New Jersey locations in Marlton, Montclair, Princeton, Westfield, Woodcliff Lake, and Shrewsbury.
Beyond being in the right place at the right time, Gunion’s success was a by-product of an uncanny ability to gauge and anticipate his market. South Moon Under opened prior to the designer jean trend and carried Levi’s jeans. Gunion, who was born in Washington, D.C. and now resides in Berlin, Maryland, took note of the attire preferences of young concert-goers and protesters.
“People were wearing distressed, older looking jeans, but no one was buying them that way; they did it themselves,” said Gunion, who said the first step was washing the stiff Levi’s to soften them. “The jeans sold out within a week.” Several months later, Levi’s, one of only three of the era’s major jean manufacturers, began offering similar styles. “We got lucky,” Gunion said, leaving one to ponder the impact of South Moon Under’s major account with Levi’s on its design decision.

The inspiration for Gunion’s iconic, trend-setting Rainbow trunks, created specifically for surfers, was a friend who owned Sundek swimwear. Recognizable by the striped u-shaped backside pattern that arcs from leg to leg on a solid background, Gunion’s Rainbow trunks with their reinforced seams were the number one sellers among the surfer community for three years.
“Why certain things resonate in fashion is hard to say,” Gunion said. “People liked the Rainbow shorts and still buy them today. It has to be different in a good way to be successful.” The only retail experience Gunion had prior to opening his first surf shack was working in a ski shop. For years, he learned by doing. As the company grew, mentors and experienced employees enhanced South Moon Under’s successful expansion. The store’s name, which Gunion is still questioned about frequently, is a term describing the moon’s position as it relates to tidal surfing conditions. Gunion noted it’s also the title of a recent book by Marjorie Kinnon Rawlings about moonshiners.

Still privately owned, South Moon Under, with some 425 employees, offers an evolving, carefully edited mix of fashions presented in comfortable, high-service environment while remaining true to its laid back and free spirited mindset.
“The knowledge of being a surfer had a big impact,” said Gunion of how his hobby and vocation intertwined. “We’re still beach-oriented. I’m a person who is inspired by anything artistically and well executed, whether it’s a great movie, a well-designed house, a good book, or a beautiful garden. Our goal is to be inspirational on the fashion side.” Abbeline and Sady & Lu are two of South Moon Under’s most popular exclusive lines. Independent designers provide portions of the company’s inventory.
“We don’t describe them as private label,” Gunion said. “We actively design the lines and have them manufactured with quality. Abbeline is the number one or two selling brand in our stores. On shopping excursions, we couldn’t find certain styles we thought our customers needed, or discussed how what we saw could be made better. We cherry pick from the lines of the major manufacturers we work with so our customers don’t have to look though things that aren’t as strong. We select smaller quantities of fashion pieces because we like to see them run out in four to six weeks, then replace them to keep our inventory fresh and new.” Most department stores have four major merchandise rotations per year while South Moon Under has eight, he said. Focus is placed on an item’s appearance and construction quality, including longevity and durability through use and washing.
With a 25,000-foot warehouse in Berlin, Maryland opened in 2014, South Moon Under is poised to increase its presence beyond the east coast. “We’re focusing on English-speaking countries first because our website is in English. Mexico will be next.” E-commerce has improved the customer experience, Gunion said. Items can be purchased online, but many customers research what’s new online before visiting the store. The Internet has garnered the company new fans in New York, Florida and Texas.
In 2013, Gunion received the Ernst & Young Entrepreneur of the Year Award for excellence and extraordinary success in the retail and consumer products category for innovation, financial performance, and personal commitment to his business and community.

“The award is an affirmation for an independent company for what they are doing,” Gunion said. “It brought a lot of attention to our company, increasing our contacts in other industries and business services. It’s a real networking opportunity.”
Gunion supports the Assateague Coastal Trust, a Delmarva Bay preservation organization, the Nature Conservancy, Habitat for Humanity, and a Berlin organization building 45 homes for the local workforce in resort areas where prices can be elevated. Tenants can lease the homes and have their rent become the down payment toward purchase. He is also a board member of the Shore Hatchery, a non-profit organization affiliated with Maryland’s Salisbury University that grants funds to foster entrepreneurs with start-ups.

“Twice annually, those with business ideas, some current or former students, present them to us and we decide which to fund,” Gunion said. “We become mentors for the businesses that win, and for some that don’t. We see lots of fascinating, innovative ideas, some technology-based.”

Environmental concerns have long been a personal and company focus for Gunion. Dressing room carpeting is made from recycled plastic bottles then gets recycled again when removed. Solar power is used in the Berlin warehouse and recycling is accomplished wherever possible. All store lighting is being replaced with LED lights, cutting usage by up to 70 percent.
“As I surfer, I’m very aware of coastal issues and negative impacts on our waters,” Gunion said. “We have environmental standards. When we build a store, we use certified wood where possible and try to add as little new material as possible, leaving exposed ceilings and polishing concrete rather than covering them with tile.” Gunion hinted more South Moon Under locations may soon be on the Garden State horizon.

“We look for locations that are a little easier for customers and resonate with them,” he said. “We’re not anti-mall, but malls can be crowded and make it tougher for customers who have to park far away. We like downtowns, like in Westfield and Montclair, and neighborhood shopping centers like The Grove in Shrewsbury.”

After “blowing out a shoulder,” Gunion spends more time boogie boarding and body surfing these days. He also enjoys hiking, skiing, biking, reading, architecture, art, and travel with his wife, three daughters, two stepsons, and one granddaughter.
“We have our direction pretty sell set,” the company president said. “We’re trying to stay focused on apparel, jewelry, shoes, accessories, and habitat. We like to provide unexpected service. We want our customers to feel the difference from other stores. Too many divergent ideas causes loss of focus.”

South Moon Under
The Grove at Shrewsbury
597 Route 35
Shrewsbury
732. 530.1200
southmoonunder.com