Italian fashion houses get refashioned for future growth


MILAN (AP) — To stay on trend, Italian fashion houses are refashioning themselves for future growth.

Luxury label Ermenegildo Zegna, which opens fall and winter menswear previews at Milan Fashion Week on Friday, made its first move to expand abroad with the Zegna Group’s summer acquisition of American brand Thom Browne. The Gianni Versace house’s entrance into the group owned by American designer Michael Kors, Capri Holdings Limited, was finalized last week.

A taste for mergers and acquisitions offers sources of cash and footholds in new markets to fashion companies that want to gain the scale for an international expansion, especially if their target is the tricky Asian market.

Charting a future path is important for Italy’s many family-run brands envisioning generational change and as various companies seek control of distribution channels. Missoni and Cavalli recently did deals with private equity investors to get cash infusions.

While French conglomerates snapped up such powerhouse brands such as Gucci, Valentino, Fendi and Bottega Veneta, the Versace sale to an American label not quite in the luxury tier created a disorientating sense in the Italian fashion world. A recurring question came up yet again: why hasn’t a fashion group emerged in Italy.

Was it Rigged? You'll Never Believe Who Beat Keanu Reeves and Tom Cruise For 2023's 'Best Action Star'

Carlo Capasa, the head of the Italian Fashion Chamber, dismissed concerns that a world centered in Milan was in peril.

“Many Italian companies don’t have Italian owners. But that doesn’t diminish their heritage or their attachment to Italy,” Capasa said. “They become much stronger. Bottega Veneta opened more stores and has increased its sales.”

The main challenge facing brands is distribution and the significant investment required to gain control of it.

“Before, only a few brands controlled distribution from the beginning to the end. Now it is common to have control over a good part of retail, which can bring more profits by taking out the middle man,” Capasa said. “But more control requires more investments. Retail drains a lot of cash.”

In the United States, he said, the decline of department stores has meant brands have had to invest in creating their own retail presence. An e-commerce launch also requires a lot of cash to get right.

Maurizio Tamagnini, the CEO of the FSI investment group that took a stake in Missoni last year, said the Italian fashion industry remains strong, representing nearly a quarter of top luxury brands and 20 percent of the fastest growing.

But despite the innovation in Italian fashion, Italy’s family-run fashion houses “have less inclination” to create a big group, Tamagnini said.

“It is easy to do, if you want to do it” by combining “the genius of our entrepreneurs with the boringness and the structure of finance,” he said.

Milan fashion stalwart Giorgio Armani is from time to time identified as having the necessary liquidity to create an Italian fashion group. But the designer has said he believes that staying small allows for the flexibility necessary to adapt to market changes.

Penalties Announced for NBA Players Involved in Scuffle: Suspensions Enacted and Salaries Docked More Than $100K Each

“I have always believed that economic independence is a fundamental value to work with full freedom,” Armani told the Italian financial publication MF Fashion. “For this, I have never thought of seeking investments that aren’t my own.”

While he acknowledged that the sale of iconic Italian brands to international groups “can touch our national pride,” Armani said they had to be squarely acknowledged as signs of changing times.

“I remain a supporter of independence, but what works for me doesn’t have to be universal law,” he said. “These brands have Italian spirit. If they manage to maintain that intact, then welcome to the international groups.”

The Western Journal has not reviewed this Associated Press story prior to publication. Therefore, it may contain editorial bias or may in some other way not meet our normal editorial standards. It is provided to our readers as a service from The Western Journal.

Truth and Accuracy

Submit a Correction →

We are committed to truth and accuracy in all of our journalism. Read our editorial standards.

The Associated Press is an independent, not-for-profit news cooperative headquartered in New York City. Their teams in over 100 countries tell the world’s stories, from breaking news to investigative reporting. They provide content and services to help engage audiences worldwide, working with companies of all types, from broadcasters to brands. Photo credit: @AP on Twitter
The Associated Press was the first private sector organization in the U.S. to operate on a national scale. Over the past 170 years, they have been first to inform the world of many of history's most important moments, from the assassination of Abraham Lincoln and the bombing of Pearl Harbor to the fall of the Shah of Iran and the death of Pope John Paul.

Today, they operate in 263 locations in more than 100 countries relaying breaking news, covering war and conflict and producing enterprise reports that tell the world's stories.
New York City