When Steve Segal and his wife, Annie, set up shop in downtown Sisters in early November, they had no idea what to expect from their retail store, Alpaca by Design, which sells products made from alpaca fiber.

The store’s strong showing on “Black Friday,” the big shopping day following Thanksgiving, stunned the Segals.

“We sold out on so much product, I was almost down to the bare walls and studs,” said Steve Segal, who operated an alpaca farm in Colorado with Annie before moving to Central Oregon.

After rush orders to replenish his supply of alpaca clothing, hats, scarves and rugs, Segal figured he had plenty to last through the holiday season, but he said he practically sold out again.

“It was our first season, so I didn’t know how much would sell,” Segal said. “I had to tell customers I didn’t have any more. I won’t let that happen again.”

The Segals estimate there are fewer than a dozen shops exclusively selling high-fashion alpaca wear in the United States. But many alpaca ranches may operate their own craft shops and carry skeins of alpaca yarn, and a few scarves and hats, he said.

Even though it’s a niche market, Segal has high hopes for his business.

“It’s really by word of mouth,” he said. “For example, the alpaca socks, someone might just buy one pair at first, but after that, they’re sold — they come back for several pair more — and then their friends come, too.

“The product really sells itself — feel this piece,” said Segal offering a sleeve of an alpaca sweater. “It’s a luxurious, silky fiber. It is the warmest of any natural fiber, it keeps you warm even if it gets wet, but it still repels water better than any fiber, too. It’s hypoallergenic because it doesn’t have the lanolin that sheep’s wool has, and it isn’t itchy, plus it lasts two or three times longer than sheep’s wool.”

Archaeologists have found cloth made of alpaca dating back 2,000 years, according to the Alpaca Owners and Breeders Association Web site, www.alpaca info.com.

‘Inca gold’

The alpaca fiber, which runs about $5 to $11 an ounce, has often been referred to as “Inca gold.” Bolivia, Peru and Chile have been using this luxurious fiber for thousands of years.

Though alpaca fiber has been around, by some estimates, for 6,000 years in South America, the industry surrounding it in the U.S. is relatively new. The animals were introduced into this country in 1984.

With the U.S. alpaca population at about 130,000, American alpaca ranchers are able to produce about 650,000 pounds of raw alpaca fiber annually. This represents about 10 percent of the estimated world production each year, according to AOBA.

Peru alone has more than 3 million head of alpaca and operates the most alpaca fiber spinning mills in the world.

In the U.S., Oregon, Ohio and Colorado stand out for their fine alpaca herds, Segal says.

“In Central Oregon alone, it’s easily a multimillion-dollar industry,” Segal said. “There are a lot of alpaca ranches here, and a lot in Western Oregon, too.”

There are 10 alpaca ranches in Central Oregon, AOBA reports.

Panorama Ranch

One is Panorama Ranch in Sisters, which has been family- owned and operated since 1994, according to ranch manager and co-owner Julie Piper.

“We moved here from Colorado to start this business, and the reason I think Oregon is such an ideal place for alpaca is the climate,” said Piper, who sells her fiber to a mill in Texas that manufactures alpaca rugs.

“The High Desert is perfect for this livestock,” she said. “You do have some (alpaca) ranches in Texas and Arizona, and some Southern states, but that must be so miserable (for the animals), because their fiber is so dense, it must be so uncomfortable and hot for them. We have to shear in the early part of June. Otherwise, it’s too hot for them here.”

Segal’s shop carries the local alpaca fiber rugs from Panorama Ranch and another alpaca ranch in Tumalo. Segal also has imports from Peru, where most of the alpaca high-fashion merchandise is manufactured.

Alpaca fiber is about 15 times more expensive than fine Merino sheep’s wool and is considered a high-end luxury good, like cashmere, according to Segal.

Segal believes many of his store’s pieces can become heirloom fashions, which can last a lifetime.

At Alpaca by Design, prices range from $15 for alpaca socks to $800 for a jacket or coat. The smaller alpaca rugs run about $200, while the larger 4-by-6-foot rugs can run about $700. Bigger rugs can be ordered.

Educating shoppers

Segal takes the opportunity to educate shoppers about alpacas whenever he can.

“I had one customer come in and wanted to know what Appalachian wool was,” Segal said with a chuckle. “I was a little confused and then I realized she meant alpaca fiber. She didn’t know what an alpaca was.”

There’s also confusion between llamas and alpacas, both from the camelid family, but used for different purposes.

Llamas, according to Segal, are used mainly as pack animals, and are about a third larger than alpacas.

Two different breeds of alpaca are used for making fibers.

“You have the Suri, which are the ones that look like they have dreadlocks. Their hair is very silky and lustrous,” explained Segal, pointing to two photos of alpacas. “This one is called the Huacaya, and it’s a fuzzy cotton ball. The fibers come in 22 natural colors, and, of course, they can be dyed, too.”

The most desired alpaca fibers come from the first shearing of a young alpaca.

“This is the softest and silkiest fiber,” explains Annie Segal, “and it commands the highest price.”

Not your mother’s old poncho

Standing in his courtyard store, surrounded by several racks of colorful and intricately woven sweaters, coats and dresses, Segal explains that haute couture designers from Marc Jacobs to Ralph Lauren are putting their models in alpaca fiber fashions.

“… This is not the era from the ’60s and ’70s — this is not your mother’s old, bulky poncho — this fiber is very fine, and it’s an eco-friendly fiber. The alpacas are only sheared once a year,” Segal said.

Segal also wants to dispel the myth that alpaca fiber is only for winter wear.

He recently returned from the Fibre 2 Fashion show in Las Vegas and ordered several shipments of spring and summer alpaca wear.

“Alpaca is wonderful because it can stay cool in the summer, wicking away body moisture,” he said. “… Alpaca is high-end, but it’s also high-style, too.”

Actor-producer Clint Eastwood is backing a company producing alpaca fiber golf wear, noted Segal, who’s trying to acquire the line.

The Segals were graphic designers before they became alpaca ranchers. So they decided to put their talents to work for the glossy international magazine, “Alpacas,” which is published quarterly by AOBA out of Nashville, Tenn.

Since joining the design team 10 years ago, the couple have helped improve the magazine and have seen it win international awards for its stories and photographs.

“I felt that since alpacas were considered a high-end, luxury fiber, the magazine dedicated to alpacas should reflect that, too,” explained Segal, holding up the most recent quarterly issue.

It’s all in the feel

As for expanding sales to the Web, Segal shakes his head and explains.

“With alpaca fiber, it’s a tactile experience, you have to be able to feel its silkiness. You can’t do that over the Internet,” he said. “People can’t imagine how wonderful it feels, unless they’ve had some experience with alpaca fiber.”

At their alpaca ranch, the Pipers were thrilled to see a local shop open to expose the public to alpaca fiber.

“We knew that if this community was introduced to alpaca fiber, and could touch it and experience it, that it would sell because it is such an incredible fiber,” Piper said. “The more people know about it, the more popular it will become, so shops like Steve’s are incredible for the entire alpaca industry.”