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Paris Attacks Hit Luxury Brands In Europe: Giani, COO Of Missoni
The horrific Paris terror attacks have affected several businesses including the luxury fashion houses, said Emilo Carbonera Giani, Chief Operating Officer, Missoni, an Italian luxury clothing brand
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The horrific terror attacks in Paris have affected several businesses including the luxury fashion houses, said Emilo Carbonera Giani, Chief Operating Officer (COO), Missoni, an Italian luxury clothing brand.
"It's clearly a tragedy, one can be cynical in a retail, luxury perspective, and it will impact the sales in Europe. Maybe we can see an improvement in the middle eastern market sales, as a certain clientele who come to Paris to shop will now shop locally," he said.
He also added that the Missoni store's sales have fallen sharply as it was also closed for some days because of the deadly attacks.
"India is not our first market but an important one like China which is our next destination," said Giani. He arrived in New Delhi to understand the situation of emerging Indian market.
Missoni is a high-end Italian fashion house based in Varese, and known for its colourful knitwear designs. Missoni opened its first and only store in Delhi at the DLF Emporio mall in 2013 through the franchise route and is planning open the second store in the next two years.
"This has been our strategy to expand at a slower pace where we monitor the performance of one store then look for expansion," says Giani.
Without disclosing the financial details, Giani said he is impressed with the performance of the store in Delhi and break-even is with the local company.
After India, Singapore and Indonesia, Missoni next market stop is China, where the luxury market is booming but Missoni is looking at multi-brand stores in China rather than mono brand stores.
"China is facing a difficult economic situation, so we will enter the market in a different way through multi brand stores and eventually get into the mono brand stores, we still consider China as a very important market as the Chinese consumers are the biggest group of luxury market," he said.
Giani went on to add that Chinese market is very cluttered and flushed with luxury brands. The reason Missoni took a long time to enter the market as it was waiting for it to space out.
The consolidated revenue of Missoni is euros 160 million growing at the rate of 5 per cent, as per the financials of the company this year 2014-15, out of which Europe accounts the largest 30 per cent to the revenue, Italy contributes 20 per cent, Japan, United States and Middle East accounts 10 per cent each to the revenue, Korea is 5 per cent and the rest of world like India, Singapore, Indonesia and others account for the rest 15 per cent of the total revenue of the company.
The Italian brand operates in a single or a two store strategy in most of the countries and cities like Paris, Munich, Delhi, and London except Italy where it has several stores. The company's revenue is a 50:50 ratio from retail and own brand stores.
Since its inception in 1953, the Italian brand has not had any external infusion of funds from a PE or a VC. "We have been generating cash and it has never been our strategy to rush into external borrowings," said Giani.
Missoni has its own factory that is fully integrated, from growing yarn, the raw materials to product design to manufacturing. It is a market leader in knitwear clothing and has no competition in this kind of product from both technical and design point of view.
Missoni has re-entered into the leather product and accessories space which they had shut down due to bad quality of the licensee. Giani said that his next strategic action will be to work in the leather accessories such as bags, belts, collection.
"We have identified a manufacturer in the leather accessories space as we don't have the expertise in this space, however, the quality control and the design will be ours," he explained.