THE GROWING WORLD OF CAROLINA HERRERA

Byline: Joshua Greene

NEW YORK — If expanding a business is all about timing, then Carolina Herrera’s time to grow is now.
April is a busy month for the designer, who opened her first shop-in-shop at the Saks Fifth Avenue flagship on April 9, kicking off a five-day fall trunk show featuring the designer’s fitted suits, tailored jackets and elegant gowns that have marked Herrera’s 20-year career.
The 600-square-foot space mirrors her Madison Avenue boutique, but more importantly furthers the relationship between Herrera and Saks, which has carried the label since 1982 and launched her latest fragrance, Chic, on March 3. Besides the shop, the collection is available at nine other Saks locations.
“Carolina’s collection has expanded greatly,” said Christina Johnson, president and chief executive officer of Saks. “The sell-throughs have been excellent and we are delighted to have her first shop in the city.”
The shop is situated on the third floor in a space formerly occupied by St. John Knits, which moved one floor below. Neighbors include Celine, Akris and Yves Saint Laurent.
Claudia Thomas, president and ceo of Carolina Herrera, said shop-in-shops are a way to build a business and signal customers that the company is expanding. She noted that double-digit growth at Saks and at other locations is expected this year. Total sales for the trunk show neared $250,000.
“We have enjoyed that kind of growth for the last few years,” Thomas said. “We had the same kind of economic downturn as everyone, but I’m happy to say that by December we saw business start to come back. I’m still cautious, but I think we’ll feel more confident by the time fall merchandise is in stores and feel a return to normalcy. We’ve had a lot of good things in place that are growing nicely.”
In addition to her already busy schedule, Herrera held a runway show at the company’s Seventh Avenue showroom on April 16 for her bridal collection, something the designer has not staged in over five years. This week, it’s off to Madrid to inaugurate the first collection retail site outside the U.S., which had a soft opening on Friday.
The new 1,000-square-foot Carolina Herrera New York boutique sits on Madrid’s Calle Serrano in the tony Salamanca shopping district. Its look resembles the formal yet comfortable feel of the 954 Madison Avenue space. Both boutiques, as well as the shop-in-shop, were designed by Toronto-based design firm Yabu-Pushelberg and feature materials such as brown and beige striped shantung fabrics, taupe carpets, exotic woods such as Macassar ebony and custom-made furniture throughout.
Though it’s the first time the Carolina Herrera New York collection will be available outside of the U.S., Spaniards know the Herrera name well. In addition to her fragrances, a licensing agreement with Ourense, Spain-based apparel manufacturer STL, Herrera’s secondary line — CH Carolina Herrera — has expanded rapidly to 11 stores since the deal was signed in March 2000.
“We have seen the results and made sure the product was appropriate,” said Carolina Herrera chairman Marc Puig, whose Barcelona-based, family-owned company Puig Beauty and Fashion Group holds a majority stake in Carolina Herrera.
Puig is also president of the Puig fashion division, which owns Nina Ricci and Paco Rabanne. Puig’s beauty division holds the licenses for Herrera’s five fragrances, which are distributed in over 120 countries, Herrera said.
According to Thomas, the Carolina Herrera brand represents worldwide retail sales of about $400 million.
“Five years ago, this number was probably half,” said Puig. “Do we see doubling this number again? That would be our objective.”
While on her Madrid visit, the designer will open the doors to the 12th and largest CH Carolina Herrera store, which sits adjacent to the new collection boutique. The CH stores, including the new 9,000-square-foot flagship, offer a masculine feel, reminiscent of a home with rich oaks, mahogany and Amazonian teak contrasted by striking accents of red.
Priced as a gold-range line, CH Carolina Herrera offers women’s sportswear for day and evening with retail prices of $350 to $2,000, tailored clothing and sportswear for men with retail prices of $300 to $1,200 and a full line of accessories priced between $40 and $700. Retail prices for the New York collection, however, run about 30 percent higher, from $2,500 for a daysuit to $25,000 for an evening gown.
“We’ve got a lot going on,” said Thomas. “We rolled out a huge number of [CH Carolina Herrera] stores. We basically went from one to 12 stores in the past year.”
In addition to the freestanding units, CH has shop-in-shops in nine El Corte Ingles stores, Spain’s major department store. But Spain is just the first part of a global expansion plan with STL — the deal calls for 40 CH Carolina Herrera stores worldwide to open over the next three to five years, including Asian capitals, Thomas said.
Puig said that with the acceptance of CH Carolina Herrera in Spain, he is confident that now is the right time to expand.
“I would say we’ll be in the U.S. market later this year or in 2003,” Thomas said. “We’re currently negotiating a freestanding store in London. One problem is the right space is very competitive.”
While manufactured and distributed out of Ourense, Spain, the design direction for the gold line stems from the watchful eye of Herrera and her New York design team.
“I have a fabulous team and I adore what I do,” Herrera said from her new shop at Saks earlier this month. “The more I do, the more I like.”
Beside the rapid growth of the CH line, Herrera’s signature line is also itching to expand, but on a smaller scale. For now, Thomas said, the less-aggressive expansion plan calls for the total of six collection boutiques in both the U.S. and abroad over the next three to five years.
Though Thomas said the the idea of freestanding bridal boutiques has come up, expanding the collection is a higher priority. For now, in the appropriate markets, she said bridal will be housed in the collection boutiques. But unlike CH, the signature shop expansion will be managed in-house.
“Our intention is to do it ourselves,” Thomas said. “We have a few small accounts in Europe, but no one with a presentation of the collection. I think when you have your own retail stores, you’re controlling your image and destiny.”
For Herrera, success is addictive.
“If you have a little success in something, then you want more and more,” said the designer. “Business has to have timing if you want to make it grow, and now is the right time to grow.”

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