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MILAN — Fueled and supported by its new owner, London-based investment firm NEO Capital, Valextra is laying out the next five to 10 years with the end game being an initial public offering.
This story first appeared in the June 24, 2013 issue of WWD. Subscribe Today.
In the first interview since the sale of his family’s 60 percent stake in Valextra, chairman Emanuele Carminati Molina and new chief executive officer Marco Franchini said NEO Capital succeeded in securing control of the Italian luxury accessories brand because it guaranteed it would protect its exclusivity, quality and Made in Italy craftsmanship. “Valextra must remain a flag for Italy,” said Carminati Molina, crediting NEO Capital founding partner David Belhassen for his vision and understanding of the brand.
Prior to the sale, Carminati Molina, who had acquired a majority stake in Valextra from Samsonite through his holding company Carfin 92 and relaunched the brand in the early Aughts, was also its ceo.
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Carminati Molina said Valextra is aiming to reach sales of 80 million euros, or $105 million at current exchange, in 2018, compared with current revenues of 13 million euros, or $17 million.
“Our objectives are feasible both in terms of quality and quantity. We want to safeguard the product in line with its essence, focusing on its evergreen values, while developing the company,” said Franchini. In his previous post as chairman and ceo of Bally, he orchestrated a major overhaul of the brand, returning the company to the black, and leaving in 2009 after seven years at the helm.
Prior to Bally, Franchini was Gucci’s general manager for Europe for eight years ending in the late Nineties.
Franchini said he starts from a better vantage point this time, as Valextra is “a healthy company that is growing, with no debt, with solid and fertile foundations, and a clear and strong identity. The press and the market alike view it as a credible brand and there are no serious emergencies.”
Franchini said that the first step is to set up an experienced managerial organization that will support growth around the world.
Carminati Molina pointed to a boost of production as the second step. The company has a manufacturing plant 20 miles outside of Milan and produces about 37,000 pieces a year. “Everything will remain produced in Italy, but we will push for a total of between 100,000 and 150,000 units per year,” said Carminati Molina. This does not necessarily mean an in-house boost, said Franchini, pointing to a “reinforcement of the production structure.”
The executive also said merchandising is a priority. Valextra has evolved from a maker of mainly men’s luggage and travel bags since its inception in 1937 into a women’s brand of handbags and small leather goods.
Carminati Molina said the best-selling Valextra styles are redesigns of models from the Sixties, such as the Boston tote, the Babila or the Tammy Bag, seen carried by First Lady Michelle Obama. None have a visible logo. “With their clean lines and strong identity, they have a very long lifespan,” said Carminati Molina.
Franchini concurred, adding that they “generate carryovers and are not very seasonal.”
Asked if a creative designer might be tapped to take over from Carminati Molina, who said he has been designing “according to his own personal taste and for his own pleasure,” both demurred. Carminati Molina said “someone will surely take over and dedicate more time than I am capable of,” pointing to his other business ventures outside fashion. “We need someone dedicated, as Valextra is capable of realizing everything.” Franchini said there is still “great untapped potential in the DNA of the brand” and expects to introduce “relevant, more modern, visible and effervescent models.”
In terms of distribution, Franchini said he was looking at locations in Paris and London for statement stores. “We plan to open four or five stores in three or four years and the same number of franchised units,” he remarked, adding that the Middle East, Russia, China and Hong Kong are key potential markets for the brand.
Valextra currently has six stores, including the stately flagship in Milan’s Via Manzoni, in a historic building that also houses the brand’s showroom and offices. Franchini said the company is looking for an additional location in Milan’s golden shopping triangle in the Via Montenapoleone area.
One freestanding boutique opened in Tokyo at the end of April, which is showing “exceptional results, beyond our expectations,” said Franchini. There are also four units in Korea.
A new venue will open in Singapore at the Paragon Mall in October in an agreement with FJ Benjamin Holdings Ltd.
In the U.S., Barneys New York is Valextra’s exclusive distributor and carries the brand in eight doors in the country. “We are very happy with this agreement,” said Franchini.
Valextra is also available at 12 other shops-in-shop and 27 corners around the world.