Who Does Bezos Turn to for Advice? Brunello Cucinelli
The head of the Italian fashion house talked about meeting the world’s richest man as the brand continued its stellar growth.
MILAN – Even the world’s richest man needs wardrobe advice.
Brunello Cucinelli, on Tuesday discussing his fashion brand’s continued rapid growth, revealed that he met with Amazon founder Jeff Bezos in San Francisco in September when the designer was there as part of the “Dreamforce Conference.” Cucinelli said he and Bezos talked for two hours, noting that the Internet titan was not wearing a hoodie but a jacket without a tie.
“He asked me for [wardrobe] advice,” said Cucinelli.
Cucinelli used Bezos as an example of how there is still plenty of opportunity for the brand’s men’s wear to grow, adding that he attended a dinner in San Francisco with 19 wealthy young men, who all wore jackets. This led him to speak of the sartorial service he recently launched in 25 stores which he would like to expand, with young tailors offering wardrobe suggestions to customers.
“I don’t accept the idea that men’s wear is suffering — it’s just that there is a need for a fresher product,” said Cucinelli, adding that businessmen still need suits, but that these must be adjusted with modern details. “And they need someone to advise them. You don’t know how many wives of rich men ask us to help their husbands to wear clothes that look fresher.”
That spells lots of opportunity for his brand — and the executive sees plenty of growth potential ahead. Discussing his namesake company’s sales in the first nine months of the year, which grew 8.3 percent to 422.1 million euros, compared with 389.9 million euros in the same period last year, Cucinelli said he expected double-digit growth in revenues for the full year.
During a call with analysts at the end of trading on the Milan Bourse, Cucinelli, who is chairman and chief executive officer of the luxury company, said he also expected “more than proportional” earnings before interest, taxes, depreciation and amortization and profits. Based on the positive performance of the brand’s winter collections and the orders for next summer, he expected double-digit growth in 2019.
Cucinelli was upbeat about the growth in all relevant markets in the nine months ended Sept. 30 and said that he did not see any slowdown in China, “on the contrary,” echoing peers such as Gucci and Moncler. “It will be the market of the future, this is the century of China,” he contended. In the period, revenues in Greater China grew 29.2 percent to 38.1 million euros, accounting for 9 percent of the total, lifted by the increasingly sophisticated Chinese consumer, said Cucinelli, appreciative of Italian craftsmanship and special items, with a growing focus on a no-logo offering.
The company is looking to sell online in China by mid-2019, and is evaluating a partner to this end. Asked by one analyst if he had considered partnering with Alibaba, Cucinelli said he could not respond yet and expressed his belief in “true, absolute luxury,” as his main guideline.
“We have just come back from several trips around the world and we are now back with renewed, great confidence in our country. Abroad there is still strong admiration for our culture, our handcrafted products, and our ability to find the best and beautiful side in all things,” said Cucinelli. “Maintaining the quality of products that the world expects from us will be increasingly important. This will be the future for our company: preserving the harmony of places and people we are renowned for; maintaining the creativity, craftsmanship and exclusivity acknowledged to us by experts and customers; designing fresh, modern and contemporary collections of very high standing, representing the true essence of luxury.”
Cucinelli said that online sales account for around 10 percent of the total globally, including the web sites of multibrand retailers, and said he expects the amount of smaller multibrand online platforms to increase as more physical stores open worldwide, citing the growth of banners in China as an example.
In the nine months, sales in Italy were up 5.5 percent to 74.4 million euros, representing 17.6 percent of the total, lifted by both local and tourist spending.
Revenues in Europe rose 9.7 percent to 127.4 million euros, representing 30.2 percent of the total, lifted by all relevant markets and a positive tourist trend, both as concerns Asian tourists, with an increased presence of Chinese customers, and those arriving from other parts of the world.
Growth continued in North America, which was up 3.3 percent to 135.7 million euros, representing 32.2 percent of the total, boosted by both the monobrand and multibrand channels and the consolidated relationships with leading luxury department stores.
Sales in the Rest of the World area grew 9.5 percent to 46.6 million euros, representing 11 percent of the total.
The retail monobrand channel grew 6.8 percent to 206.1 million euros, representing 48.8 percent of the total.
The company had 100 boutiques at the end of September, with two openings in the first nine months of 2018, in addition to the four conversions to the wholesale monobrand channel of the two Singapore boutiques in June and the St. Petersburg and Copenhagen boutiques in July.
Sales of the wholesale monobrand channel grew 11.2 percent to 24.2 million euros, with 27 boutiques, including four conversions to the direct channel and the opening at the prestigious Dubai Mall in the first quarter of 2018. The wholesale multibrand channel grew 9.5 percent to 191.8 million euros.
In the next two years, Cucinelli expects investments of between 7 and 8 percent of sales.
He spoke of the event he held in Solomeo, Italy, home to the company’s headquarters, in September, which was attended by 500 journalists, saying that he counted 129 interviews in the month. On that occasion, Cucinelli presented the conclusion of a project first unveiled in December 2014 and carried through by the Brunello and Federica Cucinelli Foundation, which sees the restoration of the outskirts of Solomeo. Cucinelli recovered 173 acres of land near his manufacturing plant and tore down six old industrial buildings, planting vineyards, olive trees, sunflowers and wheat, among other things, building a monument in travertine as a tribute to human dignity and a wine cellar, with a statue of Bacchus placed at the entrance. Spirituality is so evident in Solomeo, Cucinelli said, that he decided to call the town the “Hamlet of the Spirit.”