Category Archives: Retail

A Message To China

How key footwear firms are reaching out to China’s expanding middle class in an effort to establish brand loyalty.

Published in Footwear News, January 31, 2011

By MICHELLE TAY

AS Chinese consumers continue to exert their newfound purchasing power, competition among footwear brands is dramatically increasing as the big players battle to stand out.

China today is a much more complicated marketplace than it was a decade ago, with national and international labels fighting for attention, said Merrill Weingrod, president of consulting firm China Strategies. “No international brand is alone in trying to grab market share,” he said. “And Chinese brands are themselves continuing to evolve and get better.”

In the athletic space, for instance, Chinese firms such as Li Ning Co. and Anta Sports Products are second only to U.S. firms Nike and Adidas in terms of sales, according to Weingrod. Elsewhere in the mid-market segment, “there really aren’t any international brands that compare in sales to the major Chinese fashion brands.”

As such, the main worry for international brands in this environment is how best to get their story out.

Shoppers in Shanghai

Footwear is one of the fastest growing categories among Chinese shoppers.

With a population of 1.3 billion, China is undoubtedly the largest single market in the world. That means size matters when eking out a retail strategy, and advertising programs need to be large in scope if marketers hope to capture consumer attention.

“It’s difficult to go in with a small budget. Advertising in China costs a lot, and if you want to open one store in Beijing or Shanghai and think someone will walk by and notice it, you’re heavily mistaken,” explained Weingrod. “You don’t have to open 50 stores in a day, but you must carve out a geographic strategy, and like anywhere else, locations [of stores] really matters.”

Take New Balance, which established New Balance China in 2003 and opened its first store in Raffles City mall in Shanghai that year.
As of the end of 2010, New Balance had more than 500 stores in the country. By 2012, it expects China to be its second-largest market with more than 1,000 New Balance branded doors, said Alan Hed, the firm’s international EVP.

New Balance isn’t the only brand staking out a slot for itself.

“There are opportunities for retail growth in China across all city sizes, and we feel very bullish [we are] on our way to doubling our business there by the end of fiscal 2015,” said Nike Inc.’s U.S. media relations director Derek Kent. Indicatively, the firm’s second-quarter futures orders from the region were up by 18 percent, the most of any region.

Meanwhile, Crocs Inc. introduced its brand to China in 2006, and the consumer there now “represents a sizable percentage of our [total] market sales,” said spokesperson Shelley Weibel.

But to tap into China’s growing middle-class, brands need to raise their profile and develop their aspirational appeal.

As Weibel noted, the Chinese middle class often “desires to show their entry into an enviable social and financial class status [by purchasing] an identifiable and admired international brand,” so firms should place “heavy emphasis on understanding and developing product ranges to specifically cater to their respective consumer group’s needs [to maximize this] competitive advantage.”
It’s a strategy that luxury brands, such as Prada and Miu Miu, have already adopted.

According to Sebastian Suhl, COO of the Prada Group, both Prada and Miu Miu make efforts to produce limited-edition merchandise in conjunction with store openings in China, as well as special collections, such as a Chinese New Year leather goods assortment.

Prada’s retail sales in the country are already the group’s highest in the world, growing 73 percent in 2010 while Miu Miu’s skyrocketed nearly sixfold, said Suhl.

In addition, the Chinese make up the biggest single customer group for Prada worldwide, which is why the company has flagships across Shanghai, Beijing, Chengdu, Xi’an, Tianjin, Qingdao, Dalian, Shenyang, Guangzhou and Shenzhen. This year it will enter at least five new cities, including Hangzhou, Harbin, Changchun, Chongqing and Nanjing, Suhl added.

In a bid to impress Chinese shoppers, international luxury brands have been staging costly and high-profile events in the cities of Shanghai and Beijing, to show off their wares in creative ways that sometimes involve fusing fashion with art.

In October, luxury leather goods maker Tod’s premiered “An Italian Dream,” a documentary about Milan’s La Scala theater, in Beijing at a former power factory in the 798 art district.

Claudio Castiglioni, Tod’s GM, said the project “was a wonderful way to celebrate our patronage of the arts and [the] made-in-Italy [heritage]. It made a statement not only in China but globally.”

Noting that “it is obvious that [many] major brands are focusing their marketing strategies [in China],” Castiglioni said Tod’s goal is to “create special marketing initiatives that are suitable locally but that have a global sensibility.

“China is one of the most recent global frontiers for luxury brands,” he noted. “The demand for luxury brands in China is a definite indicator that their economy is on the upswing, [but it is still] a relatively new market, with an enormous potential to expand and grow.”

Tod's screened 'An Italian Dream' at Tank 751 in the heart of Beijing's art district.

Meanwhile, Chanel is currently staging “Culture Chanel,” a retrospective of Coco Chanel’s life featuring 400 items tracing the life of the fashion icon, at Shanghai’s Museum of Contemporary Art. And in April, designer Diane von Furstenberg will mount a retrospective for her eponymous label, called “Journey of a Dress,” chronicling her life in fashion beginning in the 1970s, when the simple wrap dress she designed created a worldwide style sensation. It will also be held at the old factory in the city’s 798 art district.

“All this is really about education,” said Patricia Pao, CEO of Pao Principle, a retail consulting firm.

“The Chinese market didn’t open up until Deng Xiaoping came to power in 1978, so people have had only about 30 years just to get acclimated to [international names]. Luxury goods, especially, are new, and people don’t know the story behind the brands,” Pao added.

“[But now], the Chinese consumer is very hungry for information,” Vincent Shaw, Chanel’s president for Asia, told Footwear News’ sister publication, Women’s Wear Daily, at the opening of “Culture Chanel,” running through March 14.

“They travel to Europe. They want to know more, and they want to know about the brands, as well as why we are important, why the houses of luxury are important, and that is one of the important positioning strategies of Chanel.

We must work with our customers to engage with them and showcase the history and heritage of Chanel,” he added.

Suhl agreed, telling FN it is important to cater to “the Chinese customer [who] is sophisticated, curious and has a voracious appetite for particular and well-designed product.”

Prada also staged a fashion show, which Suhl called part of a “longstanding commitment to strong marketing activities in China and the Asia region,” at the Central Academy of Fine Arts Museum in Beijing two weeks ago, presenting looks that were not only custom designed but were also available for special order in select China and Hong Kong flagship stores the day after the show.

But elaborate marketing approaches are not just the domain of luxury brands.

Even at a mass-market level, New Balance’s Hed said, it is important to tell brand stories “in an emotional and culturally relevant way, through an integrated communications plan that resonates directly with [consumers].”

New Balance is driving sales and brand awareness in China through a series of top-dollar marketing initiatives.

Among them are sponsoring the Jinqiao 8K race that is popular among Shanghai’s young professionals; outfitting participants of China’s “Amazing Race”-type reality show, “Rush China;” and opening two New Balance Experience Stores in Beijing and Shanghai in the past two years.

In the end, companies agreed that China offers one of the largest expansion opportunities of any country today, not least owing to untapped consumer wealth in the numerous cities outside Shanghai and Beijing, which are now considered by some to be saturated, if not mature.

Challenges, however, remain in the size and scope of the market as a whole, which sometimes calls for multiple retail partners to gain access to the right locations and understand the local requirements.

That’s why efforts at brand education will continue to be paramount for international firms, said Hed, because “given the importance of retail in building a brand, you need to dial up the part of your message [that makes clear] what makes you special versus other brands.” ♠

Opening Doors

For today’s emerging designers, breaking into branded retail has become an essential next step.

Published in Footwear News, November 22, 2010

By MICHELLE TAY

For designers on the road to success, a branded store can be an important mile marker, showing they’re established enough to take control of their image, distribution and customer interaction.

But while industry experts said the benefits are plentiful, they also cautioned that such a move is expensive, involves a lot of risk and requires a different set of management skills.

Just ask Alejandro Ingelmo, Charlotte Dellal and Raphael Young, three up-and-coming shoe designers who recently bowed flagships in international fashion capitals after a few seasons selling their labels at retailers such as Saks Fifth Avenue, Net-a-porter.com and Fred Segal.

“A designer’s reach is multiplied when the brand is put in front of department store customers at, say, Bloomingdale’s or Saks,” said Anne Brouwer, senior partner at retail consulting firm MacMillanDoolittle.

“But [customers] may not be getting a full expression of what [the brand] stands for because of other merchandise that the stores put around it.”

Indeed, for Young, who recently opened his first store on Rue Jean-Jacques Rousseau in Paris to house his eponymous line, the store offered a chance to show it all.

“We’d just launched a line of ready-to-wear [leather jackets] … in beautiful rare skins and we needed our own space to present everything in the same place and at the same time,” said the designer, who debuted his label in 2008.

Inside Raphael Young's first flagship on Rue Jean Jacques Rousseau in Paris.

Dellal and Ingelmo also described the decision as a natural progression for their businesses.

“Luxury brands are often defined by their retail concepts,” said Dellal, adding that favorable 2009 sales for her Charlotte Olympia label gave her the confidence to open a shop in the Mayfair area of London this summer. “It’s also fantastic to finally see our clients face to face and to get direct feedback on the shoes.”

Ingelmo, who bowed a shop-cum-showroom in September near his home in New York’s Soho neighborhood, is using the space, which is reminiscent of an old-school cobbler shop, to sell exclusive styles such as women’s sneakers. The Cuban-born designer acknowledged he was taking a big risk — especially as luxury spending is still tentative despite reports of an economic upswing — but that it was one worth taking.

“I’m not going to follow trends and be scared of downturns, [because] I am secure in my brand and my identity,” he said.

A branded store also can open up opportunities when wholesale networks become restrictive.

British designer Rupert Sanderson, who launched his shoe line nearly a decade ago, said wholesale businesses are more difficult to control and revenues can swing widely from season to season.

“You’re slightly at the mercy of the retailer you’re selling to. If they’re having a crappy year, it affects your business,” said Sanderson, who recently bowed his fourth standalone store, in Hong Kong.

Alternatively, retailers have become more selective with vendors in a post-recession environment. George Wallace, retail strategy consultant at U.K.-based MHE Retail, said the key is to eventually strike a balance between both operations.

“Commercially, designers have to rely on wholesale [sales to drive revenue], but having their own stores means they get to set up their collections in a beautiful way. In the end, the retail business is complementary to the wholesale business,” said Wallace.

Still, industry experts noted that the risks of opening retail are high, especially as creative types are not often trained to run a business.

“Retail is detail,” Brouwer said, adding that designers sometimes do not anticipate large operational costs, as well as inventory, rent, taxes, insurance and labor. Depending on the size and location of the store, startup costs can range from $10,000 to $200,000, experts estimated.

Dellal admitted that number crunching has become “increasingly complex and time consuming” as her brand grows.

“As a small business, we don’t have a marketing budget to compete with our large competitors, so we really rely on the shoes doing the work [to drive sales],” she said.

The risk of failure seems smaller for designers such as Young who have financial backing.

“I can fully concentrate on the artistic and design part without worrying. Our GM is also an expert on luxury fashion, [having been] an executive board member at LVMH for more than 15 years,” said Young, adding that a store in New York is already in the works.

In spite of the difficulties, boutiques are fast becoming an important part of any emerging designer’s business plan. However, they must be patient as success can take years.

One thing is for certain at this stage: Opening retail “feels right and instinctively makes sense,” said Sanderson. “In very brutal terms, if you’re not prepared to take a risk by opening your own shop, why on earth would any other wholesaler be interested in taking your product?” ♠

Luxe Firms Head East

With wealth on the rise in key overseas markets, the big players are opening flashy new stores.

Published in Footwear News, October 25, 2010

By MICHELLE TAY

NEW YORK — Footwear firms are heeding the call of the East.

It’s no secret that as the economy finds its legs again, retailers are stepping up their game and growing their footprints.

And much of their focus once again is on emerging markets in the Middle East and Asia Pacific, where luxury malls are popping up and attracting brands such as Christian Louboutin, Jimmy Choo, Manolo Blahnik and Stuart Weitzman.

Retailers and real estate consultants said now is the time to expand in these areas, where wealth is rising and brand fatigue has yet to sink in — a marked contrast to the mature U.S. market. In addition, availability in these areas is at an all-time high, experts said.

“If you’re looking to expand, you’ll do it now,” said Kazuko Morgan, EVP for real estate firm Cushman & Wakefield in California.

In Shanghai, for instance, 9.3 million square feet of new retail space will come online before the end of 2010, according to research by Knight Frank China, with a further 8.7 million square feet expected next year.

Prime retail rents in Shanghai rose 17 percent in the second quarter to average about $262 per square foot per year, according to Cushman & Wakefield, and are expected to rise a further 50 percent in the coming year.

But that’s still a bargain compared with most major cities. For example, retail rents on Paris’ Champs-Élysées are $1,256 per square foot per year and on New York’s Fifth Avenue, $1,250.

“In the current climate, China’s retail market has greater potential as an investment vehicle than almost any other retail market in the world,” Andrew Weir, partner-in-charge of real estate at KPMG China, wrote in a report released by the firm. “Despite the global financial crisis, China’s retail sales have continued to grow at double-digit rates, while retail sales have stagnated in many other markets.”

Consider the newly built Shanghai IFC Mall. More than half its 1.1 million square feet of retail space is leased to luxury retailers, including Bally, Salvatore Ferragamo, Louis Vuitton, Chanel, Hermès, Gucci and Prada. And roughly 15 percent of its retail tenants are making their debut in China.

“People [in China] have very strong spending power. Global retailers have achieved good sales [results] here,” said Regina Yang, director of research and consultancy at Knight Frank China, adding that shoes and handbags are top categories for Chinese shoppers, followed by watches and jewelry.

Prada Group COO Sebastian Suhl said Prada and Miu Miu’s stores in the Shanghai mall have shown strong early results. “It’s a gorgeous mall in a completely new and affluent part of town for retail,” said Suhl, adding that Prada would also open in Guangzhou’s Taikoo Hui complex later this year.

Apart from China, retail hotspots are also popping up in the Middle East, which is an accessories-driven market.

Christian Louboutin marked his debut in the United Arab Emirates by opening a boutique in Dubai’s Mall of the Emirates Fashion Dome last month. The designer had unveiled stores in Beirut and Jeddah, Saudi Arabia, earlier this year and plans to bow five more stores in the region by 2013.

“The Middle East is a strategic territory for us because it’s very much a market for shoes and handbags, and fits with our aim of opening more retail stores. The region makes up 3 percent of our global business, and we believe we can easily double that in the next two years,” said Alexis Mourot, COO of Christian Louboutin, noting that the brand plans to add 15 new doors worldwide next year.

Down under, Westfield Sydney, a $1.2 billion shopping center slated to open later this week, has attracted Aldo and Stuart Weitzman. It is located on the Pitt Street Mall, which has experienced the world’s highest rise in rents over the last 12 months, surging 71 percent to $748.50 per square foot, according toreal estate firm Colliers International.

Nathan Clark, Colliers’ national director of retail agency, said there is still plenty of room for upscale brands to expand in the region.

“With credit markets improving, retailers with a strong balance sheet are quickly gaining the confidence to expand into markets previously viewed as too expensive or difficult to penetrate,” he said.

Weitzman told Footwear News he is opening in Sydney because the brand’s results in Melbourne “have been beyond expectations. [Plus], Westfield is the premier landlord in Australia, so these factors [will make] a recipe for success.”

The designer noted that the brand also is opening a boutique in the Beijing IFC within the next 12 months.

Singapore is another city with one of the strongest pulls this year, thanks to the Marina Bay Sands resort that opened its 800,000-sq.-ft. retail paradise last month.

Notably, Louis Vuitton’s flagship in The Shoppes at Marina Bay Sands will be enshrined in a standalone glass pavilion that appears to float on the water off the bay. And at least 10 other shoe brands have planted their feet there, including Jimmy Choo, Manolo Blahnik, Bally, Crocs, Birkenstock, Hush Puppies and Skechers.

Jimmy Choo CEO Joshua Schulman said the new mall at Marina Bay Sands offers a “completely different type of shopping experience and clientele” and “will provide great exposure to clients from China and all over Asia. Marina Bay Sands has a critical mass of luxury brands. Expectations are high for this center.”

Manolo Blahnik recently unveiled a store in The Shoppes modeled after a Chinese birdcage, and further international expansion is top of mind for Kristina Blahnik, the designer’s niece, who oversees store planning.

“The Middle Eastern market is fairly new to us insofar as it has developed within the last 10 years, and sales have been fantastic and growing well. Russia also is a very fast-expanding territory for us, while Singapore is such an international place with a very transient [population],” said Blahnik.

The brand recently unveiled a boutique in Dubai Mall and is about to bow a shop-in-shop in Moscow’s Tsum department store.

“As a global brand, you need to be located in these key cities [to take advantage of growing demand] in that market,” Blahnik said. ♠

Pushing Prada

An interview with Prada SpA COO Sebastian Suhl yields details on the luxe’s giant plans for rapid expansion and the long-awaited IPO.

Published in Footwear News, September 13, 2010

By MICHELLE TAY

NEW YORK — Size matters at Prada.

From the expansion of its retail network — nearly 100 new stores this year — to its growing footwear business, it’s clear that for the Italian luxury house, bigger is definitely better.

Prada Group COO Sebastian Suhl said the firm is on track to sell nearly 3 million pairs of shoes this year, about 50 percent more than it did in 2009.

Suhl, who was in town for meetings last month, told Footwear News in an hour-long interview in the offices overlooking the Hudson River that the group is making a concerted effort to dedicate more retail square footage to shoes. For example, in Prada’s Las Vegas CityCenter outpost, there are 2,000 square feet of footwear in a store that measures 20,000 square feet.

“That’s big when you consider it’s one-tenth of the store for product that takes up such little space,” said Suhl.

“We’re also looking at large shoe-selling areas because it’s something that, from a design point of view, you can [use to] create a salon — making it not just functional but a point of attraction.”

Overall, Suhl, who works closely with Miuccia Prada and company CEO Patrizio Bertelli, said the firm is being “very aggressive” with opening new stores and expanding existing units, all part of the strategy to make retail sales the lion’s share of group revenue.

“Retail this year is budgeted to make up 70 percent of total sales, and we’ll beat that, probably up to 75 percent or even 80 percent between all our brands,” he said.

Among the glitziest global openings within the past year were the Miu Miu store in Las Vegas’ CityCenter; the Prada and Miu Miu stores in Shanghai’s IFC; and Asia Pacific’s largest Prada flagship (13,000 square feet), in Singapore’s Ion Orchard.

Next year, in Tokyo, Prada is moving from one end of the famous Ginza shopping strip to the other, while across the Middle East, freestanding stores are slated for Qatar, Doha and Dubai.

“These periods of crisis are the perfect opportunity for those who have the means to expand. Locations are to be had and it’s a good time to negotiate rents,” said Suhl.

The company’s plan for North America is to fan out across regional malls, where its brands lack presence.

“We view the U.S. as a high-growth area. Out of the 91 openings we’ve had this year, 21 are in the U.S. That’s significant,” said Suhl, who added that discussions are under way to open stores in shopping centers in Houston and Atlanta, as well as in malls such as the Beverly Center in Los Angeles and Short Hills Mall in New Jersey.

Wholesale continues to be an important part of the business, as well, and retailers said the Prada brand stands out in the footwear segment.

Cody Kondo, group SVP and GMM of accessories at Saks Fifth Avenue, attributed Prada’s success to its tremendous breadth in styles, spanning classic staples to cutting-edge looks.

“Season after season, Prada presents a line of shoes that merchandises well together, giving [customers] a range of options. As a merchandising team, we continue to be impressed by Prada’s commitment to quality and to pushing the creative envelope,” Kondo said.

Prada has recovered from the recession more strongly than many other luxury companies. Earnings before interest, taxes, depreciation and amortization in the first quarter of 2010 were 64 million euros, or $81.3 million at current exchange — up more than 500 percent on 11 million euros, or $14 million, recorded in the same period last year.

First-half revenue rose 29 percent to 930 million euros, or $1.24 billion, in the six months ended July 31. The luxury house did not reveal bottom-line figures for the half year, but Suhl said he is keeping his fingers crossed that the company will “be way ahead of our very aggressive bottom-line budgets.

“Newspapers keep saying Europe is tough, but we’re up 37 percent in that market. The U.S. is up 41 percent. Asia is up 70 percent. It’s amazing,” said New York-born Suhl.

“Our results show that there is money to be made and business to be done and more market share to be had.”

Prada COO Sebastian Suhl at the group's New York headquarters (Photo by Steve Eichner)

FN: How big of a focus is footwear at Prada?
SS:
Footwear has really been a part of our DNA since the early 1980s. We have historically been and still remain [among the] largest producers of footwear in the world. Last year, we sold well over 2 million pairs of shoes between Prada and Miu Miu, and [including] wholesale and retail. This year, we’re up towards 3 million. Footwear makes up roughly a third of sales, both in the U.S. and globally. One of [the] Prada and Miu Miu brand strengths is the remarkable balance of sales among core leather goods, footwear and apparel categories, [and] we expect to maintain this balance going forward. The main difference between footwear, leather goods and ready-to-wear is that the penetration of wholesale footwear is higher than other categories, as it’s much more of an opportunity to go beyond your own stores, [for example] into department stores.

FN: Did your wholesale strategy change during the recession, particularly as department stores cut prices?
SS:
Department stores remain a huge network and gigantic business. They have been an important part of our business for decades — and still are — but we’re working with the stores in a more qualitative way than we used to. We’ve pared down the number of doors in general. We had 230 doors across all Prada categories in department stores. We’re now down to about 170, and 140 of those are shoes. So when I say that wholesale has become a minority of our business, that’s simply because retail has grown so much bigger. That’s thanks to the investment in new stores and the investment in making existing stores sell more.

FN: Is luxury footwear more resilient in an economic downturn than other categories?
SS:
It’s hard to answer in general terms as it depends on the brand and the collection at any given point in time. To be honest, we’ve seen equal growth now between bags and shoes and ready-to-wear. But men’s, that’s a great category for us right now. The men’s market has become less of a niche, and our men’s footwear is certainly booming. The men’s business now makes up 30 percent of our worldwide revenue.

FN: What is your strategy for the Car Shoe and Church’s brands?
SS:
Prada and Miu Miu together contribute 90 percent to group revenue, so Church’s and Car Shoe’s share of the pie is very small. These brands are very footwear-oriented, but have developed under Prada to expand into women’s and, in Church’s case, into umbrellas, socks and ties. They’re both making money, and we believe we can grow them significantly. In 2009, we opened three Church’s stores and one Car Shoe. In 2010, we opened four Church’s and two Car Shoes.

FN: Is e-commerce going to be an important growth driver for you? And what is your response to criticism that you’re late to the game?
SS:
We do things when we’re ready — that’s the honest truth. Since we launched e-commerce in Europe last May and in the U.S. this July, we’ve seen very encouraging growth, especially since the merchandise is limited to leather goods and eyewear. It’s a good start and allows us to get our logistics and systems working properly. In my mind, it’s a success because one, we haven’t launched all categories, and two, we haven’t done much to promote it. By the end of this year, we expect to have completely redone the Prada website and launched one for Miu Miu.

FN: How much does e-commerce contribute to the group’s revenue?
SS:
Let me put it this way: It’s already equivalent to a midsize store. And it should grow to be at least the largest store in every country, and I don’t think that’s so far [off] in the future. I’d like to think it’s within the next few seasons. [However], I wouldn’t say we’ve exceeded sales expectations because we have very aggressive expectations.

FN: How much of your growth is coming from Asia?
SS:
We’ve had amazing growth the last four years in Asia, and while this year isn’t finished and we shouldn’t claim victory yet, it is [going to be a record year]. In fact, we’re outperforming the market in Asia, including China, South Korea, Hong Kong, Macau, Taiwan and Singapore. Of course, Prada has lost some sales in Japan, although Miu Miu hasn’t. The country [is dealing with] a macroeconomic issue beyond any brand’s control, and it remains a large and profitable market for us.

FN: Your IPO has been stalled for nearly a decade. Where are you hoping to list when it does happen?
SS:
It could be Milan, Hong Kong or London. We’re trying to figure that out. The performance in Asia is positive and definitely steers one in [the] direction [of the Hong Kong exchange] to a certain extent. But as I’ve said, we’ve seen significant growth in all markets. So it really depends on the condition and buoyancy of the capital markets because whoever is investing in our company will obviously have a global picture [in mind].

FN: Is the IPO’s aim mostly to pay down your debt or to fund expansion?
SS:
We’ve generally been generating consolidated cash flows that are well in excess of the huge capital expenditure that we’ve made in the last three years. Debt is not something that pressures us every day, [although] it’s something to be managed. But every group has debt, and many groups have higher ratios of debt to operating profit than we do; ours is less than 2 percent. Of course, the IPO will finance debt, but we really view it as fuel for expansion.

FN: Do you think the fourth time will be the charm?
SS:
Frankly, we’ve had a lot of bad luck, but it’s not like not having done the IPO in 2001 has harmed us. In any case, what’s important to keep in mind is that the IPO is of a minority stake, although the size of the stake has yet to be decided. This will remain a family group and its DNA will not be diluted or reduced by an IPO.

FN: Is the company considering any new acquisitions, or has the experience of the 1990s put you off?
SS:
We are a four-brand group, and the plan right now is to concentrate on those. We’re concentrating on what we
do best. ♠