MILAN — Nobody dares provide forecasts as the coronavirus outbreak continues to disrupt — and take — lives and business is screeching to a halt around the world. Even less so Vittorio Radice, vice chairman of Rinascente, whose retail vision has helped revitalize the department store business in Europe.
“The truth is that whatever is said today can be contradicted the next day. The pandemic is an event that is so new and different and that has no comparable metrics,” said Radice.
Asked about possible correlations with the Lehman Brothers collapse in 2008 or the SARS emergency, Radice believes the COVID-19 pandemic can’t be compared because “those were isolated financial or industrial events, while this is touching every individual, it is total and global. The machine was forced to stop, restarting will also be a challenge.”
Radice has a bird’s-eye view of business. He cut his teeth as managing director of Habitat U.K., turned Selfridges around between 1996 and 2003 and, after a stint at Marks & Spencer plc, joined Rinascente as chief executive officer in 2005, with a mandate to revamp the then-sleepy department store.
Under a new owner since 2011, the Thailand-based Central Retail Corp., Rinascente is now part of a group that also owns Copenhagen-based Illum, and has a majority stake in KaDeWe in Berlin; Alsterhaus in Hamburg, and Oberpollinger in Munich. Central Retail is part of Central Group, the Thai group controlled by the Chirathivat family, and operates retail businesses in Thailand and Vietnam as well as Italy, listing as many as 2,000 stores in Thailand, 134 outlets in Vietnam under a variety of banners, and nine Rinascente department stores in Italy. In Thailand, only the food stores remain open, said Radice.
“Each one of our companies is unique and in a different stage of development,” he explained, which makes the situation even more complex. “At KaDeWe Group in Germany we are in the midst of investments, with open construction sites, and we are repositioning the brands. Illum in Denmark, is ramping up, while Rinascente in Italy is more mature.”
In addition, standing in different countries, the groups “are implementing the indications given by the Italian, Danish and German governments, which are all different. We are landmarks. As such, we are really waiting for each government to give us precise indications on what to do.” All of Italy’s Rinascente stores have been closed since March 11 and the company launched a campaign on social media called #stayhomestaystrong to convince people to avoid the risks of contagion, with dedicated images in its windows.
As industry insiders and observers question how the coronavirus will impact prices and discounting, the seasonality of goods and fashion in general, Radice said “the spring stock that is arriving will not be sold, and as for the fall orders, who knows, it depends on when the stores will reopen.” He is also convinced that “we can’t return to the methods, terminology, commercial calendars or promotions that belong to the past. We won’t pick up where we left. We work day by day, but it will not be business as usual when all this is over.”
Apart from the health of employees and associates, the key priority in terms of business now is cash and “understanding how to channel it.”
“For retailers, cash comes from the door of the store opening at 9 a.m. and closing at 10 p.m. and if that door doesn’t open, business is over.”