MONDI MAKING MAJOR REVAMP
Byline: Melissa Dreier
MUNICH — There’s a new Mondi Group in the works. In a move to broaden its fashion and customer base, the Munich-based firm has repositioned all six of its independent apparel lines, including the Mondi collection, for fall/winter 1995-96.
The new strategy keeps Mondi as the group’s core collection. But the more expensive and fashion-directed Elementi and Portara lines — as well as the fashion-forward Chris line, the Patrizia S. large size collection and the sporty Braun line — will now support Mondi by having some overlapping themes and price points.
In the most radical move, Portara has been relaunched as a young fashion line priced 30 percent below Mondi, and 40 percent below its former levels. “Only the name remains the same,” said chief executive Hans-Peter Barbier of the new Portara line, which features kicky little mini-suits and dresses with trumpet sleeves.
Chris, introduced last season, continues to take fashion-forward strides. With more selective distribution, it overlaps Mondi’s higher-priced end while catering to a more daring customer. Elementi, now in its seventh season, still sits at the top of the Mondi Group’s price and fashion scale, overlapping with Chris. The collection of advanced knits has been chalking up the largest sales increases — between 40 and 70 percent — of all the group’s lines.
Braun has been expanded from an expensive golf-oriented line to a moderately priced active sportswear collection. And Patrizia S. has been priced at and below Mondi’s price points, which is expected to significantly boost the collection’s export performance. And the core Mondi line itself has also been freshened up, to make it visibly younger and more sophisticated.
“There are enough traditional Mondi looks in the line to make the existing customer base happy, but lots of new looks to appeal to new customers,” observed Thomas A. Andruskevich, president and chief executive officer of Mondi of America. New to the Mondi line are daywear looks such as a short, zipper-accented charcoal gray suit paired with a cropped mohair jacket in orange, yellow and pink blanket checks. Traditional looks, such as graphic sweaters, are more refined, and the Mondi Sport separates in winter fleece and terry strike a surprisingly youthful note. “There seems to be a seven-year cycle in market behavior, and brands [can] lose face,” said Fidelius Graf Von Rehbinder, director of international sales and distribution.
“You then have to do something for the next generation. It’s dangerous when you age with the customer,” Rehbinder added. Mondi’s trade up in fashion meant an increase in some prices. In Mondi’s linen and viscose theme, jackets will retail in the U.S. for about $390; skirts and pants for $190, and a suit for $580. This compares to the more fashion-forward Chris, where a sweater in metallic cupro will retail for $350; a skirt in acetate and viscose will sell for $250, and a body-hugging knit dress in viscose and cotton will be priced at $450. Mondi’s new looks and prices are appearing a little over a year after the investment company Investcorp became the sole owner of the Mondi Group. Under new chief executive Barbier, management and company organization was restructured, with a focus on establishing distinct profiles for the group’s individual brands. The core Mondi line generates about 70 percent of group sales, which were flat in 1994 at $273.8 million (430 million marks). But the reorganized group now blankets more price points and fashion levels than under its former structure, and sales are expected to grow 15-20 percent this year.
The Mondi Group exports roughly 75 percent of total sales to the United States, Canada, the U.K., the Netherlands, Switzerland, Austria, Belgium and Austria. The Far East accounts for only about 7 percent of the Group’s business, but Barbier says Asia will play a more dominant role in the future. To keep export sales strong and growing, the company is paying more attention to the particularities of local markets. Von Rehbinder explained that the company might offer an apparel group in lighter fabrics for warm climate markets. The company is also looking at how to do different cuts for the Far East. The U.S. market represents roughly 25 percent of total exports, a share that the company hopes will grow. “We have a very aggressive growth plan for 1995, and we expect to post double-digit sales increases,” said Andruskevich. “Our goal is to be the leading resource of ladies’ bridge apparel.” Currently, there are 48 Mondi stores, and 12 outlet stores operating in the U.S., which account for roughly 85 percent of Mondi’s American sales of about $45 million. The group also wholesales to about 175 accounts in the U.S., mainly to specialty and department stores. Wholesaling, however, “will be the fastest growing area for Mondi in the future,” Andruskevich said. While he would not disclose the stores he is currently negotiating with, he said that a store like Dillard’s, a current client, is “the best example” of the kind of account he wants to target.
On top of adjusting its fashion collections, Mondi has also set about changing the look of its freestanding stores, which number about 200 worldwide and generate 25 to 30 percent of the group’s sales. The new Mondi store concept debuted last September with a new three-level shop in the Grunwald area of Munich which showcases all of the Mondi Group lines. A flexible furniture system of stained maple is arranged in open cases on a light beechwood parquet floor. There’s a living room-like setting in the back for the friends or husbands of shoppers.
Barbier said five more stores are planned for Germany’s larger cities by the year 2000. Only large, or multilevel stores will carry all of the groups’ labels. Otherwise, they will remain strictly Mondi stores.
In the U.S., Mondi of America is embarking on its own retail strategy based on three kinds of stores: a flagship for major cities that could carry three to five of the group’s collections; mid-size stores that will sell two to three lines, and tiny stores that will likely carry only Mondi. The new look will be unveiled at the new Woodfield, Ill., and White Plains, N.Y., stores, slated to open in March.
Other stores scheduled to get the facelift include those in Short Hills, N.J.; Boca Raton and Palm Beach Gardens, Fla., and Atlanta. Andruskevich said that while these stores will sell the Mondi line, the company is studying which stores might retail other collections in the group beginning next fall. Currently some stores sell Braun and Portara alongside Mondi.
“I would like to see our segment of the industry improve,” said Andruskevich. “Designer and luxury are doing well, but bridge is tough. Fortunately, we’re outperforming the market. Sales are up, margins are up and our expenses have been controlled.”