MILAN — At a time of generational and ownership shifts at several Italian companies, a major shake-up is taking place at the family-owned Etro SpA.
This story first appeared in the March 25, 2014 issue of WWD. Subscribe Today.
Ippolito Etro will leave his role as general manager to “pursue new business horizons,” effective April 1, said his brother Jacopo, global communications vice president.
Their father, Gerolamo Etro, known as Gimmo, president of the Milan-based firm, will take on Ippolito Etro’s role ad interim.
“The Etro Group sincerely acknowledges Ippolito Etro’s worth and the profitable job he has performed over the years, which has allowed us to reach important goals in Italy and abroad,” said Jacopo Etro.
He underscored that his family has no intention of relinquishing the company’s ownership.
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A market source said future growth strategies may have been central in the reorganization. Ippolito and Jacopo Etro’s siblings, Veronica and Kean, are women’s and men’s wear creative directors, respectively. Jacopo Etro is also more of a creative mind, leaving Ippolito Etro to deal with the business and commercial issues, “often in conflict with the other three siblings,” said the source. “I believe Gimmo Etro and his wife were thinking of creating the conditions for the company to go forward and my impression was that they were balancing this axis, but tension must have built up and something must have happened that caused Ippolito to leave abruptly,” said the source, adding that a public listing “must have been considered, given the recent success of family companies such as Salvatore Ferragamo and Brunello Cucinelli.”
Armando Branchini, deputy chairman of Milan-based consultancy InterCorporate, said it’s “normal for conflicts to emerge in family companies, rarely based on personal issues but rather on potential solutions to help grow and develop the firm. When their name is on the tag, each individual believes their vision can help enhance and build the brand.”
The company’s revenues in 2013 totaled 325 million euros, or $429 million, up 4 percent compared with the previous year. The Milan-based firm last year stepped up its investments in China, and a big fashion show event and retrospective are planned to take place in Beijing on April 25 at the China Central Academy of Fine Arts. In 2013, Etro’s sales in the region grew 120 percent through 13 boutiques, which the fashion house plans to double in number this year.
Europe, where Etro operates stores in cities such as Milan, Paris, London, Barcelona, Munich and Vienna, accounts for 48 percent of sales, and Italy, in particular, represents 18 percent of total revenues. A first store dedicated to its Home collection will open in Milan on Via Pontaccio in the arty Brera district.
As reported in December, Etro is expanding its presence in North America, its second-largest market. It has recently opened a new store in Beverly Hills and last June relocated its Miami flagship in Bal Harbour. New units are expected to open in Atlanta this year and Houston in 2015. Etro also counts two doors in New York City, in SoHo and on Madison Avenue. The latter was refurbished in 2012. There is also a boutique in Manhasset, N.Y.