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Diesel Opens German Flagship

Diesel is set to celebrate the opening of its 10th and largest German store today in a landmark building on Munich's Residenzstrasse.

BERLIN — It’s been a big week for Diesel in Germany.

Diesel founder and boss Renzo Rosso was presented with the Textil Wirtschaft Forum prize for his life’s work in Heidelberg on Wednesday, an award bestowed on designers such as Gianni Versace, Jil Sander and Gabriele Strehle.

Rosso was characterized at the awards ceremony as someone who combines the courage to go his own way with a keen commercial sense that has helped Diesel generate 2004 sales of more than $1 billion without losing the brand’s edge. He is, as one industry source enthusiastically commented, “still crazy after all these years.”

Diesel is to celebrate the opening of its 10th and largest German store today in a landmark building on Munich’s Residenzstrasse. The 4,850-square-foot unit offers the complete Diesel women’s and men’s assortment on two floors, including Diesel Denim Gallery, which each month offers a new pair of limited-edition jeans that sell for about $320 to $500.

“This is the first time in Germany that we’ve gone more premium in both the look of the store and the collections offered,” said Dietmar Axt, country manager of Diesel Germany. “And, it’s the first time bags and shoes are being offered in such depth.”

It took two years to find a Diesel-worthy location in Munich, which Axt considers “the most important fashion [retail] city in Germany.”

While he wouldn’t divulge first-year sales goals, he said Diesel stores normally generate 5,000 euros per square meter, which at current exchange rates would add up to about $2.9 million at the new store. Diesel’s own stores generate about 25 percent of the brand’s volume in Germany, and the ratio “will stay that way,” he added.

Germany is Diesel’s fourth-largest market. Over the last three years, Diesel has slashed its distribution in the country to 550 doors from 1,300, reflecting a more selective positioning.

“We’re now making the same turnover with the 550 as we did with 1,300,” he said. “Germany is difficult, but we saw and reacted to the weaknesses three years ago, and it’s paid off.”

However, when it comes to its own stand-alone stores, Diesel has been on an expansion kick. The Munich store brings the number of units opened since 2004 to 22, and brings the total number of locations to 174.