Ferragamo Ends Venture With ICR-ITF
FLORENCE — Ferragamo Parfums has terminated its Italian distribution agreement with Italy-based fragrance giant ICR-ITF Group.
Lodi, Italy-based ICR-ITF will officially cease its Italian distribution for Ferragamo Parfums on Jan. 1 and will hand the reins over to the Florence-based company, which will directly distribute to the Italian market.
In Italy, Ferragamo Parfums has 1,200 points of sale. Regarding the consolidation of its Italian distribution, Ferragamo Parfums aims to start a “selective national distribution network” to “manage the distribution of the Italian market, coherent with our company strategy.”
The move is considered part of a restructuring of Ferragamo to maintain a stable, 20 percent annual growth rate of its fragrance division. The goal is to have the fragrance division generate 15 percent of company sales within the next five years, from about 6 percent today, as noted by Salvatore Ferragamo Group chief executive officer Ferruccio Ferragamo in an interview last year.
Ferragamo Parfums recorded a 50 percent rise in wholesale sales last year to 30 million euros, or $34 million, at average exchange rates. Recent launches Incanto Pour Homme and Apparition by Ungaro are expected to drive a 70 percent jump in the firm’s sales by year-end, pushing revenues to 50 million euros, or $60.9 million at current exchange rates.
Despite having lost the Italian distribution rights, ICR-ITF Group, headed by ceo Roberto Martone, will continue worldwide production of fragrances for the Salvatore Ferragamo and Emanuel Ungaro brands until 2009.
— Stephanie Epiro
Kenzo Eye Creams to Bow
NEW YORK — Kenzo Parfums North America will launch two eye creams next month under the Kenzoki skin care collection it introduced in the U.S. in March. The two creams, called Ice-Cold Eye Cream for day and Relaxing Eye Whipped Cream for night, are designed to yield protective and reparative benefits, respectively. Ice-Cold Eye Cream employs mamaku extract and mango butter, while the night cream uses white lotus plant water.
The duo will be introduced at 46 Sephora stores and at seven Nordstrom locations, an expanded distribution base for the Kenzoki treatment line, whose 21 items were originally launched in the U.S. at 16 Sephora doors. LVMH Moët Hennessy Louis Vuitton owns the Kenzo fragrance and apparel brand and the Sephora USA chain. Kenzo Parfums North America’s assortment of fragrances and skin care products are carried in 185 U.S. doors. It has been estimated that Kenzo’s beauty business generates more than $5.1 million in U.S. sales.
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More Closings at Boots
LONDON — More than a year after Boots plc closed its Boots Wellbeing Services, which offered facials, manicures and Botox injections — and scrapped in-store trials of alternative medicines such as aromatherapy and homeopathy — the retailer is to close additional service-oriented businesses by the end of the year. These include its laser hair removal, dentistry, chiropody and laser eye correction businesses, which have resulted in losses.
“Despite improvement in productivity, there is no prospect of the businesses [being exited] making acceptable returns for the group going forward,” Boots stated. The firm said the majority of its 54 dental practices, 52 chiropody clinics, 14 hair-removal sites and nine laser-eye clinics will be shut down by Dec. 31 at a cost of 55 million pounds, or $98.4 million, of which 29 million pounds, or $51.9 million, will be devoted to writing down assets. These figures are at current exchange rates. These businesses currently occupy 49,000 square feet of space in stores and will be converted into retail trading space in the next two years.
The company said losses in the fiscal year ended March 31 for dentistry, chiropody and laser hair removal were 16.3 million pounds, or $27.6 million, on sales of 28.9 million pounds, or $50.5 million. Laser eye correction sales were 19.4 million pounds, or $32.9 million, with a loss of 3.8 million pounds, or $6.44 million. Results for the fiscal year are at average exchange rates. The move affects 850 jobs across the U.K., but the company said it aims to re-deploy as many people as possible.
— Ellen Burney