In 1811, the Commissioners’ Plan laid out the grid system of streets and avenues between 14th Street and Washington Heights that would become the literal skeleton of New York. A year later, New York City Hall was built, and five years after that, the New York Stock Exchange was unveiled.
All those dates show how nascent the future metropolis of Manhattan was in 1818, the year the 45-year-old Henry Sands Brooks opened a men’s haberdashery, H. & D.H. Brooks & Co., in a small wooden storefront on the northeast corner of Catherine and Cherry Streets, within blocks of the East River and the site of the future Brooklyn Bridge, which wouldn’t be built for another 52 years.
Brooks’ mission was a simple one: “To make and deal only in merchandise of the finest quality, to sell it at a fair profit and to deal with people who seek and appreciate such merchandise.”
Two-hundred years later, the business that Sands founded — and which was later renamed Brooks Brothers in honor of his four sons: Elisha, Daniel, Edward and John — continues to adhere to that mission as it has grown to become a household name in the U.S. and around the world. And tonight, it will celebrate that milestone with a star-studded black-tie event at Lincoln Center that will also be live-streamed on its Facebook page.
Over the course of its long history, the company has survived depressions, recessions, wars, the twists and turns of fashion and a slew of ownership changes. Today it has sales said to be in excess of $1.1 billion and counts about 250 full-price and outlet stores in the U.S. and more than 700 units internationally in 50 countries.
Brooks Brothers remained in the family’s hands until 1946, when it was sold to Julius Garfinckel & Co. The company operated within a retail conglomerate named Garfinckel, Brooks Brothers, Miller & Rhoads Inc., which was sold to Allied Stores in 1981. Under Allied, Brooks Brothers experienced aggressive growth that wound up undermining its historic strengths.
Then along came Robert Campeau, a reckless Canadian real estate developer, who purchased Allied, and in 1988, sold Brooks Brothers to the U.K. retailer Marks & Spencer. The British company’s constant changes of strategy and its focus on the bottom line led to an even more diluted message and Brooks Brothers’ quality and reputation continued to deteriorate.
But in 2001, Brooks Brothers found its white knight when Italian billionaire businessman Claudio Del Vecchio — chief executive officer of Retail Brand Alliance and son of Luxottica founder Leonardo Del Vecchio — bought Brooks Brothers from M&S for $225 million.
Sitting in the conference room at his office within the Brooks Brothers Madison Avenue flagship, Del Vecchio said matter-of-factly that if he hadn’t stepped in to save the retailer, “there’s very little possibility that we would have made it to our 200th anniversary. The brand might have still been alive, but it wouldn’t have been what it historically was.”
But rather than simply purchasing the business, Del Vecchio set out to return it to its former glory — but carefully and respectfully. “We fixed Brooks Brothers, we did not transform it,” he stressed.
Slowly, he set out to significantly upgrade the merchandise mix, revamp the stores, expand overseas and add several product categories.
His deliberate and low-key approach to revamping the business speaks volumes about Del Vecchio as a person as well as a businessman.
Although the 61-year-old’s net worth is believed to be in excess of $1 billion, he remains unpretentious. He lives in a large, but not ostentatious, home on the north shore of Long Island with his American wife, Debra, and their two children. He’s an avid golfer, a soccer fan and a foodie.
With his wealth, he could easily sit back and hit drives on the golf course all day, but that’s not Del Vecchio’s style. Although his father is believed to be worth nearly $23 billion — making him the second richest man in Italy and 47th richest person in the world — the elder Del Vecchio was raised in an orphanage and developed an enviable work ethic that he passed down to his son.
Claudio Del Vecchio started working at a Luxottica factory when he was 14, and then joined the company full-time after two years of college and an obligatory stint in the Italian army.
At 22, the younger Del Vecchio was charged with heading Luxottica’s sales force in Italy, and two years later he was sent to Germany to establish the company’s first direct foreign distribution. A week later, he was sent to America to help manage the company’s U.S. distribution. He was 25 years old and spoke little English, but within four years he had increased U.S. sales from $28 million to $100 million. Then, in 1990, he spearheaded Luxottica’s public offering on the New York Stock Exchange. “We were the first foreign company to go public in the U.S. before we went public in our own country,” he recalled.
By then co-ceo of Luxottica with responsibility for the Americas, Del Vecchio had some business dealings with Brooks Brothers around this time when he negotiated the retailer’s eyewear license, the first in its history. But his familiarity with the brand came long before that. His attraction began in his youth when he realized that the famed chairman of Fiat, Gianni Agnelli, a global fashion icon in men’s wear, was a Brooks Brothers customer. (Agnelli particularly favored Brooks Brothers’ button-down collar shirts.) That stuck with Del Vecchio and when he arrived in the U.S. in 1982, the first store he visited was Brooks Brothers. He was hooked.
So when M&S put the business on the block, Del Vecchio was all in.
Bids for the company were originally due on Sept. 12, 2001 — the day after the terrorist attacks, which delayed the auction and caused other potential suitors to drop out, including Men’s Wearhouse, May Department Store Co., Polo Ralph Lauren and Dickson Poon.
On the day after Thanksgiving, Del Vecchio’s bid was accepted.
But be careful what you wish for. Returning the company to its former glory was going to take time — and money, lots of it. And the business climate wasn’t especially robust.
“When we bought the business, the economy wasn’t great,” Del Vecchio said. An understatement perhaps, but he stayed the course, knowing that Brooks Brothers’ business wouldn’t get better until the merchandise was improved and the core mission restored.
“Our first priority was to fix the product,” he said.
He talked to longtime employees and asked a simple question: “What should the company be?” The answer from one veteran? “We should be Brooks Brothers.”
So he visited the company’s vast archives and immersed himself in the photographs, fabrics, colors and designs that illustrated Brooks’ original mission, which Del Vecchio has called “one of the most beautifully articulated and longest-running mission statements in American business history.”
What he found in those archives, for example, “was not the jacket to build, but the reason for it and the motivation behind it,” he said at a presentation about a decade ago.
Del Vecchio’s strategy was to return Brooks Brothers to being “an innovator, not a conservator.”
For his time, Brooks was considered a dandy and a disruptor, always looking for the newest, most-fashionable styles and pushing the envelope on design.
Many of the company’s innovations — now considered classics — were radical when developed or introduced into the American market, including the first ready-made suit (1849), the foulard tie (1890), the four-button Number 1 sack suit (1896), the button-down polo collar shirt (1900), the Shetland sweater (1904), the repp tie (1902), madras fabric (1902) and wash-and-wear shirts (1953).
That strive for innovation continues to this day. Gianluca Tanzi, chief operating officer for Brooks Brothers who oversees manufacturing, pulls up the company’s Wikipedia page and proudly points out all the bullet points under the Clothing Innovations tab. But the final bullet point — or dot as the Italian native calls it — is the non-iron 100 percent cotton dress shirt in 1998. “After 1998, there are no other dots,” he said. “We are trying to get some more dots.”
Under Tanzi’s tutelage, Brooks Brothers hired a team of product engineers, most of whom are originally from Italy, responsible for specific manufacturing functions. For example, one is in charge of knitwear, another materials, a third outerwear, a fourth tailored clothing, and a fifth shoes.
As a result of their expertise, Brooks Brothers has upgraded the internal construction of its tailored clothing so it’s better “balanced,” he said; some sweaters are now created with 3-D knitting, eliminating seams; there are washable wool shirts that are naturally resilient and offer stretch, and chinos have been infused with stretch properties and are dyed in a richer color palette.
But Tanzi is perhaps most proud of the company’s outerwear, where Brooks Brothers has really moved to enhance its technical quotient, using fused fabrics in the highest-priced Golden Fleece collection that provide water- and wind-repellent properties in everything from classic raincoats to reversible Windbreakers.
The footwear offering has also been enhanced. The Golden Fleece shoe collection boasts the sophistication of a dress shoe with the comfort of an athletic one. They are made in Italy from calfskin leather and feature Goodyear welt construction and a removable Ortholite insole for soft cushioning.
Innovative product is found in all three levels of Brooks Brothers’ offerings, Tanzi said: its mainline, Golden Fleece and Red Fleece, the younger-skewed collection. And while the technical attributes in Golden Fleece are the most costly, similar details are found in the lower-priced lines as well.
Tanzi believes that in addition to product, innovations can be used to engage customers in other ways, including enhanced service. So the company plans on instituting a concierge service and one day soon offer made-to-measure customers a way to get up close and personal with their garment by creating a video of the production in the plant where they’re being made.
It helps that Brooks Brothers owns its own manufacturing facilities. Ties and baseball caps are produced in Long Island City, N.Y.; shirts in Garland, N.C., and suits, sport coats, trousers and dress coats in Haverhill, Mass., in the Southwick facility.
In 2008, Del Vecchio came to the rescue again, this time buying the Southwick plant, which was in danger of closing. Brooks Brothers was the factory’s biggest customer, so it made sense, but Del Vecchio then invested some $20 million to create a state-of-the-art facility and retained all of its 300-plus employees.
“It’s a major competitive advantage,” Del Vecchio said of owning the factories. He said 100 percent of the neckwear and more than 80 percent of the suits in the full-price stores are manufactured in the company’s own facilities, along with the made-to-measure and oxford shirts.
Del Vecchio’s reliance on his own factories is just another indicator of his quest for quality — quality that can be controlled best with internal oversight.
This shows in his strategy toward international operations.
Today, 35 percent of Brooks Brothers’ sales are international. Japan, where the company has had a presence for 40 years, is still the brand’s largest market outside the U.S., but China will soon overtake it as the fastest-growing, Del Vecchio said, with India not far behind.
With the exception of a few small markets where it still has licensees, the company controls its business in foreign countries either by holding the majority stake in a joint venture or owning it outright. “It’s how we maintain consistency,” Del Vecchio has said.
Maintaining consistency is at the core of his mission for Brooks Brothers, despite the roller coaster ride that defines the retail business.
“There was the Civil War, two world wars, the Depression,” he said. “But the beauty is finding a way to adapt and adjust for 200 years.”
Del Vecchio believes it’s the company’s unwavering focus on its customer that is key. “As their needs change, we’re better at adapting to those changes than other people,” he said. “And we’ve been able to follow the needs of our customers for 200 years.”
Today he believes the customer is still seeking the same thing he did two centuries ago: “great quality product that lasts and makes him feel comfortable and confident in every situation.”
The company has succeeded in that, he believes, adding, “I don’t think we’ve ever had better product than we do today.”
The merchandise today is overseen by Lou Amendola, chief merchandising officer, who has been with the brand since 1998. Before joining Brooks he was with Macy’s for 17 years as well as Donna Karan and now is the chief architect who steers the retailer’s product offering.
Amendola said that when Del Vecchio bought the company, the new owner received reams of letters from loyal customers asking him to bring back a quality product. “That was an era in retail when price was the most dominant attribute, but what Claudio instilled in us was to not just look at what something cost, but what we could add to improve the value and quality,” Amendola said. “That was the big change.”
While price will always play a role for retailers, Brooks Brothers has worked instead to educate customers on why an item costs what it does and not get caught up in the promotional game. “That’s the future of Brooks Brothers,” he said.
Like Del Vecchio, Amendola has a healthy respect for Brooks’ history while keeping a close eye on current trends to ensure the chain stays up to date. That’s often a tough juggling act. “Not being a fashion-forward house is an advantage,” he said. “It’s the engineering of the product that is important and will make us different in the future than our competitors.”
So while Brooks still sells a classic navy blazer, “that blazer performs differently than the one your grandfather or father would buy,” he said.
While Brooks Brothers may not lead the fashion parade, it has made some truly out-of-the-box moves over the years. The most stunning was hiring designer Thom Browne in 2007 to design Black Fleece, a new collection that blended classic Brooks Brothers fabrics and tailoring with the edgy, shrunken silhouette of the designer.
Del Vecchio readily admits that signing Browne started out “as a public relations exercise” that he never expected to become a real business. But Browne’s popularity with fashion insiders and his knack for reinventing the company’s American classics actually resulted in a business that at its peak had sales of $10 million.
“It was a great opportunity for us at a time when we were fixing the business,” Del Vecchio said. “We needed to tell people something had changed at Brooks Brothers in a positive way. It also created traffic in the stores. Black Fleece was one way to bring curiosity and attention around our name. And it was a good thing, it became more of a business than we had expected.”
The deal with Browne was supposed to last three years and wound up lasting seven.
But for all the sales it produced, Black Fleece also had a downside. “Our traditional customer got confused,” Del Vecchio said. “The newer, younger customer may have rediscovered Brooks Brothers, but we did not do a good job explaining what we were doing. Black Fleece was a great combination of what Thom Browne is and what Brooks Brothers is. From a quality standpoint, it was more Brooks Brothers, but from its aesthetic, it was more Thom Browne. So [when the partnership ended], the guy who bought Black Fleece stayed with Thom Browne and the people who appreciated quality stayed with Brooks Brothers.”
It’s that consistent quality that Del Vecchio believes sets Brooks Brothers apart. “We’ve never been the hottest brand in 200 years, but we’ve probably been in the top 10 for 200 years — and the other nine have changed,” he said. “We are consistent in how we serve that customer.”
Serving the customer has also changed dramatically since the days when Brooks opened up shop in lower Manhattan.
Today, Del Vecchio said business is OK and the company is breaking even, but “the work never ends. The business model is changing and like every other specialty retailer, there are major adjustments we have to make.”
He said traffic in the stores is down, but e-commerce continues to gain in importance. And social media is also becoming a bigger part of the mix. “We’re not where we need to be yet, but we’re more active. That’s one of our major projects and opportunities. The good news is that social media is all about telling stories, and we have more stories to tell than anyone.”
But at the end of the day, it all comes down to product.
“New customers walking into Brooks Brothers today are surprised by what they see,” he said. “They may know the name, but they don’t know the product. We’re one of the best kept secrets.”
The 200th anniversary gives the company “a good opportunity to talk about the brand,” he said, reiterating a mantra that has become part of the fiber of his being. “We’re not good because we’re old, we’re old because we’re good.
“But the good news is that our brand is not tarnished, and that’s a major asset we have.”
Brooks Brothers continues to attract new shoppers, whether it’s through the company’s Instagram page or its traditional newspaper advertising.
To appeal to the younger shopper, the company created Red Fleece, which is targeted to the Millennial. Interestingly, 60 percent of the sales in Red Fleece are online, and it’s only on sale two times a year.
The main line is slightly more promotional, but Del Vecchio’s attitude is consistent across all categories of business. “We can’t have quality and offer the same level of promotions as others do,” he said. “In the end, we want to sell great quality merchandise at a great price.”
With Red Fleece, there’s a store dedicated to the line in the Flatiron district of New York with a café that is consistently busy. “We had to learn how to manage the coffee business,” he said with a laugh, “but our goal was to create an environment that people are comfortable in, and I think we’ve accomplished that.”
In the future, Del Vecchio said although the company is “still experimenting, we believe this is a concept we will have more of.”
The Red Fleece store is a street-level location and Del Vecchio said about half of the stores in the company’s U.S. fleet are on the street, while the other half are in malls. They’re mainly located in all major metropolitan downtowns, with seven in New York City alone.
“The challenge is to balance the rent we pay with the [revenue they achieve],” he said. And despite the struggles with malls around the U.S., he said Brooks Brothers actually has the same number of stores it had a year ago. “One reason is that we’re only in the top malls in the U.S.,” he said, and these mall stores are still performing well.
“We have the benefit of being in many different places and good locations. Some are not profitable at all,” he admitted, “but we’re adjusting the reality to today’s traffic, resizing a lot of the stores and working closely with the landlords. And we’re still opening stores.”
In the meantime, online will continue to gain in importance. “We need to be very good at that and keep investing there,” he said.
E-commerce accounts for 30 percent of the business in the U.S. and nearly 20 percent overseas. He said there’s no goal for how large the business can ultimately be, and “we’ll let the customer decide. It’s a service, not a strategy,” he said. “We’re not trying to push the customer one way or the other. We find that the majority of customers — maybe 80 percent — shop both ways.”
Del Vecchio said retail is “different today” than when he first started. “Five years ago, the majority of people in the store came after they’d seen something online. Now, people come in, learn about the product and shop online. The store and e-commerce are much synergistic today.”
In addition to e-commerce, Del Vecchio believes there’s also a lot of growth possibilities outside the U.S. borders.
“International today is 35 percent of our business and we would like to see it closer to 50 percent,” he said. “We don’t think it will take many years.”
Women’s wear is also viewed as a major growth driver. It currently accounts for around 20 percent of overall sales and four years ago, Del Vecchio hired designer Zac Posen as creative director for its mainline women’s collection and accessories. His first collection hit stores for spring 2016.
Del Vecchio said that right after Posen started, there was “a little dip” in sales, “but that was planned.” He said there had been an “inconsistency between Mrs. Brooks and Mr. Brooks” in terms of product design, and “we weren’t top of mind” for most women.
So much like with his move with Thom Browne, Del Vecchio reached outside of the company’s ranks to snag Posen. “It’s small enough of a business to take risks and wait for the right customer to come in,” he said. Ordinarily with a significant design shift, “you lose a lot of the old customers,” he said, “but after the first couple of seasons, we saw that we were selling more to people who were our customers before as well as to new customers. In fact, women’s for the last year has been our must successful category.”
Despite the success, Posen’s name doesn’t appear anywhere on the label. Neither did Browne’s.
“Zac is the designer of our women’s collection and it’s been a great relationship, but in 200 years, we’ve never put anyone’s name on our collection and we’re not about to change that,” he said.
All told over the past 17 years, Del Vecchio has done a fine job maintaining the Brooks Brothers identity and setting up the company for future success. But he remains modest about his role. He has no plans to retire anytime soon but when that does eventually happen, he’ll need to decide who will be handed the reins.
Although his son Matteo is ceo of Deconic, the company’s jewelry business that includes Alexis Bittar and Carolee, his appointment isn’t a slam dunk.
“My father is 83 and still working. I’m still young and having a lot of fun,” Del Vecchio said. “Eventually, someone else will run it, but if I feel it’s my son, a lot has to happen. He has to want to do it, he has to have the qualities that it takes to run the business and we still have to be here as a family.
“The Del Vecchios are not the reason for Brooks Brothers to exist,” he continued. “My job is to do the best I can. I’m just one chapter in the book. When I bought the company, I wanted to make it strong enough to celebrate its 200th anniversary and we did that. Everything else, we have to earn. This is all about Brooks Brothers, it’s an institution.”