By  on December 27, 2006

MILAN — Italian entrepreneur Maurizio Borletti firmly believes in the formula of department stores and is poised to prove its validity through the revamp of Italy's La Rinascente and the expansion of the Printemps banner in France.

Borletti, La Rinascente's chairman, tapped Vittorio Radice as the retailer's chief executive officer, and in a little more than 10 months the former Selfridges ceo has already changed the accessories, beauty and innerwear floors at La Rinascente's flagship in Milan, attracting top players such as Louis Vuitton, Fendi, Salvatore Ferragamo, Gucci and Burberry.

Here, Borletti tells WWD why he thought it was worthwhile to invest in both store chains, creating one of the few department store retailers to operate in more than one country in Europe, and what the future holds for the two retailers.

WWD: Why did La Rinascente, Printemps and other department stores around the world lose momentum, and what are the right steps to put them back on track?

Maurizio Borletti: We have to go back to superior service and to stimulate our customers with our product research and innovative and luxurious goods. In the Sixties and Seventies, department stores became about selling as much merchandise as possible, to pay the rent and to balance costs of personnel. Just as an example, Printemps closed a beautiful architectural part of its [Boulevard Haussmann] store to gain more space and extend its selling floor, while shutting out the natural light. Consumers today find cheap merchandise in thousands of ways — that's not what they are asking us. They want to know what is happening in the world, they turn to us as purveyors of new, sophisticated products.

WWD: What can department stores rely on, what are their added assets?

M.B.: There are no large retailing spaces smack in the middle of our cities, that's why I believe department stores can work. Of course, there are competent retailers and specialty stores out there, from Biffi to Colette and 10 Corso Como, to name a few, but these can't offer a wide selection of goods for each brand or designer in order to fully represent the essence of the label — they simply don't have the space. The locations are usually exceptional, and the fact that we know how to run this kind of business helped us in the transactions that led to the acquisitions. A number of potential buyers favored the locations but did not know what to do next. We looked at it in a different way: Here is a business that can do better, and we can add value to the location. And with more than 10,000 employees at stake, the vendors, who were socially responsible, were confident we would not put them out of a job.

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