Byline: Melissa Drier

HAMBURG — The recent opening of Jil Sander’s newest flagship on Neuer Wall here had plenty of people asking, “Why did it take so long?”
Hamburg is not just the city the designer calls home and headquarters of Jil Sander AG, it’s where the company’s story began, with the opening of the first Jil Sander boutique in 1968. Yet Sander put the Hanseatic port on hold and chose Paris and then Munich and Berlin to present her rigorously pure new retail concept.
“It was personally difficult for me to separate myself from Milchstrasse,” site of the original Sander boutique, which recently closed, the designer said, standing in the new flagship. And finding a space with the right proportions to accommodate Sander and American architect Michael Gabellini’s jointly developed store design was no easy matter.
“The competition in today’s designer market is not merely a battle over market share, but also the right location,” remarked Roland Bohler, managing director and board member of Jil Sander AG. “And we wanted to find the right spot.” A new building on Neuer Wall, Hamburg’s emerging “Madison Avenue,” which already has designer tenants such as Giorgio Armani, Hermes and Ferragamo, provided the long-sought site.
With approximately 5,400 square feet of floor space, ceilings almost 20 feet high and a 130-foot stretch of windows, the corner store not only has ample room for Jil Sander women’s, men’s, fragrances and accessories collections, but is most accommodating to Sander’s open and spare retail style.
“This space was so perfect,” said Sander. “We’re constantly working on our [interior] concept, regarding the function, quality and the proportion of the rooms. But with this store, we didn’t have to make adjustments or fill holes anywhere.”
Like the Paris flagship, the Neuer Wall store emphasizes indirect lighting and materials such as granite, sandstone, Venetian glass and nickelplated silver.
The store here is the seventh company-owned flagship. Milan is next; a 6,500-square-foot shop is set to open in March on Via Verri No. 6.
By next year, Jil Sander AG expects to just about double the number of its flagships, Bohler said, some through franchise partners. New stores are slated for Osaka; Costa Mesa, Calif.; Zurich; St. Moritz, and Basel, Switzerland. A site in Miami is being discussed, and the search is on for spaces in Korea and Tokyo.
A decision may be imminent on a site in London, Bohler noted. “It’s too early to disclose, but it would be a megastore,” he said, adding that a New York flagship is also on the horizon.
“We were very close to taking a very traditional and familiar New York location, but we weren’t sure, so we waited. We’re working on it with a very successful partner, and if they’re not ready to do a flagship, we will. In our worldwide picture, New York is missing,” Bohler stated.
In addition to the Jil Sander flagships, there are 46 joint-venture or franchise shops, and shop-in-shops. Bohler expects the number of franchise and shop-and-shops to grow to 100 in the next three years. In all, the Jil Sander collections are sold to about 300 retail customers in about 350 doors worldwide.
In Germany, where the company’s sales have been flat in a generally depressed market, Sander has rolled back the number of accounts it sells to, from 130 to 110. “We felt 130 was a bit overdone, and when a retailer retired, we simply didn’t look for a replacement,” Bohler explained.
“It’s clear that if the market is suffering, we’re flat, too, but with $85 million [DM 150 million] turnover here as a monobrand, we’re the [designer] market leaders,” he declared.
As previously reported, Jil Sander group sales rose 5.5 percent to $51.4 million (DM 90.5 million) for the first six months of 1997.
The Jil Sander men’s collection, available since mid-June 1997, accounts for $2.6 million (DM 4.6 million) of that figure, and FOB men’s sales for the first year are expected to reach “close to $22.4 million (DM 40 million),” Bohler said.
Domestic sales, on the other hand, dropped 4.4 percent for the period, and profits before taxes declined sharply to $2.9 million (DM 5 million) compared with $6 million (DM 10.5 million) for the six-month period last year.
“Strategic investments” of about $28.5 million (DM 50 million) since 1995 are due to be completed in 1997. The establishment of Jil Sander America Inc. and Jil Sander Italia SpA, the building of the flagship stores, the purchase of the Via Verri property in Milan, the palatial new showroom here and start-up costs for the men’s collection all cut into earnings, Bohler said.
Nevertheless, both Bohler and Sander were very upbeat about the company’s future.
Sales growth for 1997 is now projected at 2 percent, and while 1997 profits are expected to fall short of 1996’s, by 1998 “we will be in a break-even situation and by 1999 we’ll have a clear return on our investments,” Bohler told WWD.
“We know we can grow a lot,” he continued, although a second line or new licensees — there are currently three, for cosmetics, leather and eyewear — are not being considered.
Instead, the company will focus on building the men’s collection and making the most of its accessories business.
Compared with Gucci and Prada, where accessories generate the lion’s share of sales, Bohler noted, “We do only 5 percent of our turnover with leather and bags. I think we could grow that business to 25 to 30 percent of sales.”
A new men’s fragrance is planned for a mid-1998 launch.

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