THE NEW BOSS
Byline: Samantha Conti
MILAN — When Grit Seymour was hired last July as chief designer of the start-up Boss Hugo Boss women’s collection, her first instinct was to destroy, not create. Together with her product manager, the mild-mannered — but strong-minded — Seymour ripped apart the classic Boss men’s jacket to discover its essence, and to find the map she needed to guide her in building the first major Boss women’s collection.
“We knew the Boss brand was best known for the suit, so we tore it to pieces, picked it apart and put it under a magnifying glass. We wanted to see its inside life,” said Seymour, 34, during a recent interview at Boss’s high-tech women’s headquarters on the outskirts of Milan. “We looked at the fabric, the fit, the hanger appeal, and then began thinking about a feminine interpretation,” added the German-born Seymour, who has worked for Donna Karan, Daniel Hechter and Max Mara.
Seymour’s first prototype was a single-breasted jacket she described as “the perfect girlfriend, or wife, for the Boss man.” But the jacket was only the beginning. This week, retailers from around the world will begin taking an exclusive look at the 600-piece, spring 2001 women’s collection that will make its runway debut here in October, during the ready-to-wear shows.
The Boss women’s project is an ambitious one: Werner Baldessarini, chairman of the German men’s wear giant Hugo Boss AG, has said the company’s goal is to make Boss an “international market leader in the women’s fashion segment.”
Massimo Suppancig, chief executive of the new women’s company, Hugo Boss SpA, sees the line as designer sportswear that blends Boss’s German spirit with Italian flair — and manufacturing muscle. And in a clear message to the industry, Suppancig has decided to show — and sell — in Milan rather than at the CPD trade show in Dusseldorf, Germany’s leading fashion event. “This is an international, designer rtw collection, which means it belongs in Milan and not at a trade show in Germany,” said Suppancig.
And while any start-up is risky, especially in an industry overcrowded with designer sportswear lines, the Boss women’s collection has a very important edge: one very wealthy, well-connected parent.
“Boss is such an excellent brand name, and is strong in a variety of markets,” Julie Statham, an equities analyst at Deutsche Bank in Frankfurt, told WWD. In a report published last spring, Statham wrote: “While we believe the men’s wear collection has the potential to grow around 10 percent a year… we see the group’s real upside potential lying in the new Boss women’s wear collection.”
Both Deutsche Bank and CAI Cheuvreux, also based in Frankfurt, say that in the long term the Boss women’s business could equal, or even outpace, the men’s wear in terms of sales and profitability. In 1999, the Boss men’s lines generated $714 million (DM1.5 billion) and a consolidated net income of $52.6 million (DM110.5 million). (Dollar figures are translated at current exchange.)
Hugo Boss AG is quoted on the Frankfurt stock exchange; just over 50 percent of shares are owned by the Italian textile and apparel giant Marzotto. While Marzotto officials are clearly supportive of the women’s project, for which start-up costs totaled $33 million (DM70 million), they have had no direct involvement in it.
Analysts not only point to Boss’s brand strength across a variety of markets and the fact that the women’s wear market is generally larger than men’s wear, they also say they’re encouraged by the Boss women’s retail outlook. Some 45 new Boss franchises are slated to open in 2001 in Europe and Asia, and most of them will carry the women’s line only. About half of the new stores will be operated by veteran Boss franchisees.
“Retailers earn good money with the Boss brand,” said Statham. “It’s one of the labels with the lowest proportion of reduced-price sales at the end of the season.” Statham estimated that 500 to 800 international retail clients are targeted to carry the new line, and “probably around 50 percent of… sales initially will be clients that already stock the men’s wear line.”
And in another retail development, Boss officials indicated that they plan to open a store in New York on Fifth Avenue next spring that will carry both the men’s and new women’s line. The store will most likely be wholly owned by Boss, and the combination of men’s and women’s is meant to provide a unified global image for the brand, officials said. Deutsche Bank’s 2001 projections are in line with those of Boss, which is expecting $48 million (DM100 million) in sales and a negative impact on overall group earnings. For 2002, Boss is expecting the women’s line to break even, but Statham thinks that’s too conservative: she sees earnings before interest and taxes (EBIT) reaching a healthy $8 million (DM16.8 million). For 2005, Statham is projecting sales of $262 million (DM550 million) and earnings of $38 million (DM80.3 million), compared with Boss’s more conservative $167 million (DM350 million) sales projection.
This is the company’s third — and most serious — launch of a women’s collection. In 1998, Boss launched Hugo, a young and trendy collection that generated $7 million (DM15 million) last year. That collection is perceived more as a youthful and experimental line, and is still developing its identity in the market. In 1990, before Marzotto bought a majority stake in the house, the company had launched a small women’s line, but that lasted only one season.
“This project is everyone’s baby,” said Suppancig, 40, former vice-chairman of the Escada group, and one of the industry’s youngest and most progressive managers. “We’re all depending on one another to make this work.” When he was hired in 1998, Suppancig insisted that the headquarters be in Milan, rather than at the Boss base in Metzingen, Germany. He wanted both to take advantage of Italian manufacturing know-how, fabric expertise and professional talent, and to signal to the market that Boss Hugo Boss was to be an international — and not simply a German — clothing line.
After pondering a joint venture, a licensing agreement or the purchase of another company, Suppancig and the Boss brass decided on a start-up. “Why delegate your know-how and your profits to someone else?” said Suppancig, during a tour of the factory.
Then there was the appeal of creating something from nothing. “I wanted to start from zero and make sure I had the best personnel and structures the industry had to offer. My goal was to gather as much fashion experience and expertise as possible,” said Suppancig. “My idea was to recruit worldwide and put a new, fast machine behind the staff, a machine that would leave them free to develop their ideas.”
Suppancig, who before joining Escada was managing director of the European branch of clothing manufacturer GFT, did the job in record time. He hired Seymour last July, and by March she and her all-women’s team had pumped out a sample collection of some 900 pieces.
Key members of the management team include: Giuseppe Tosco, former chairman of Kurt Salmon Associates in Italy, who is operations director; Roberto Cappelli, formerly of Max Mara, who is director of sales; Hansjoerg Flassak, already a member of the Boss group, is financial director; Seymour, formerly women’s apparel designer at Daniel Hechter, also worked for Donna Karan in New York on the Signature line; and Caterina Salvador, the product manager and an integral part of the Boss design team, had worked with Calvin Klein and Giorgio Armani. By next year, the staff at Hugo Boss SpA will number 100, and by 2005 it should rise to 250.
Also new to Boss is a computer system that allows Seymour to feed a sketch into her computer and zap it to the patternmaker downstairs who, after adapting it, zaps it to the sample studio. When the sample is finished, Seymour and the product manager work with the merchandise team who are able to simulate the garment on a hanger in a Boss store, complete with the price tag. The system also allows employees to follow the development of a garment, from sketchpad to sample, via the click of a mouse. “This fully-integrated system really differentiates the Hugo Boss women’s project from other clothing companies,” said Jurgen Kolb, an equities analyst at CAI Cheuvreux. “In the future, it will allow the company to adjust easily to the changing trends and react quickly to market demand.”
Suppancig has been both the material and spiritual leader of the project: He found the minimalist, 86,400 square-foot headquarters — designed by Antonio Citterio — and called in the feng-shui architects to guarantee his staff a positive energy flow. He ordered up the state-of-the-art computer system and flew in the plots of fresh grass from Holland to complete the Zen-like garden, with its big olive tree, at the building’s center.
A key word at the headquarters is transparency: Big windows in the management offices and the design studio look down on the lower floor where the pattern makers, fabric researchers, knitwear and jersey experts work. Suppancig said about 80 percent of the building, formerly designer Antonio Fusco’s headquarters, was unused, and his goal was to make it as modern, feminine and airy as possible. Floors and walls in the offices are a warm white, and the glass doors are framed in white steel. The lower floor, with its soaring ceilings, has a more industrial feel with gray cement block walls, exposed pipes and shiny gray cement floors.
Seymour and Salvador said their big challenge in developing the collection was how to create the right fit for a wide variety of body shapes and sizes. “In this collection, there isn’t one global look or size: there are shapes for every woman,” said Salvador. “The collection includes every type of proportion and that means different waistlines and different rises in the trousers. We were careful with the shapes, careful in trying to cover a woman’s defects.”
The two are also sensitive to the “emotional aspect” of fashion. “In the Seventies fashion was about making a statement,” said Salvador. “In the Eighties it was about power dressing; in the Nineties fashion was all-natural, and I think now it’s about emotion and having fun with what you’re wearing. We’re offering them that experience, with the quality and fit to back it up.”
Seymour said the collection is also about offering well-tailored clothing at reasonable prices. “Buttons are handsewn, the top stitching is done in grosgrain. It’s traditional tailoring done in an industrial way — at a reasonable price,” Seymour said. The target is an “emancipated, professional” designer sportswear customer, a 25- to 45-year-old woman who is always “25 in her head,” said Seymour. Retail prices for the collection range from $600 to $800 for a blazer.
The first ad campaign will be shot by Peter Lindbergh in October, with Fabien Baron as the creative director. The model is Mini Anden. Suppancig said the women’s campaign would be “in harmony” with the ones for the Boss men’s collection. “It was important for me that there be a united corporate identity for the men’s and women’s collections,” said Suppancig. Indeed, Lindbergh and Baron have worked in the past with Boss and will be producing their upcoming spring campaign.
That same creative team has also just finished shooting the women’s fragrance campaign, which also stars Anden, in the Camargue region of France. The Boss Hugo Boss women’s fragrance, made under license by Procter & Gamble, will make its debut in Europe and Asia in September and in the U.S. next spring. In addition to producing the Boss fragrances, P&G also helped management carry out its initial market research before launching the women’s collection.
Despite the potential pitfalls of tardy or incomplete deliveries, analyst Kolb said he has “strong confidence” in the project and above all in the management of Hugo Boss SpA. He said he believes that the company will turn a profit as early as 2002 and that the company’s projection of $167 million for 2005 was “too conservative.”
A fashion industry consultant, who asked not to be named, said the company also does not have the pressures of a fashion-forward designer line: “This line does not have to be at the cutting edge; it has to be modern, wearable, professional. There really isn’t a question as to whether or not it’s going to be the next Gucci. And that’s a positive thing: It means the team can focus simply on turning out great collections.”