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Benetton initiates three-year program to refocus business
29
Nov '13
The Benetton Group’s Board of Directors approved the three-year program to refocus the business.

This project is designed to provide maximum market competitiveness for Benetton Group brands through comprehensive innovation in the corporate structure, with a refocusing of the areas of the company’s activities.

The program also aims to complete the process to rethink, refocus and relaunch which began in 2012, an action that is starting to give its first results, including improved cash generation and disposal of a limited number of properties no longer in line with the positioning of Group brands.

The three-year program approved entails in particular the organization of Benetton Group into three distinct realities: one with a clear focus on the brands, a manufacturing component and a real estate management component. All three realities will be directly controlled by Edizione S.r.l.. It is the evolution of a model and structure already rewarded by financial markets even at the time of the Group’s first listing

Following this new organization, the Benetton Group brands, among the most renowned and well loved in the world, will be able to respond with increased effectiveness to market scenarios. United Colors of Benetton and Sisley are, in fact, particularly strong brands with very high levels of markets.

In this context, the refocusing strategy for the reality dedicated to the brands will be chiefly represented by the following elements:

- Aan increasingly marked separation of the two main Benetton Group brands in the diverse competitive arenas of the market;

- Focus on investment in directly controlled key and flagship stores;

- Further development of new concepts for retail outlets;

- A strong geographic focus to target key countries;

- A progressive development of the potential of accessories and licenses, such as the agreement recently announced with Puig for fragrances.

The manufacturing component will be mainly dedicated to serving the Group’s brands through the first rate production platforms that already exist in Serbia, Tunisia and Italy.

The real estate component will be better able to develop and obtain a return on locations that are either no longer strategically viable or whose features and spaces no longer comply with the sales format of Benetton Group brands present on the market

The main objectives of the program, at the end of the three years, are to maintain substantially constant turnover, to offset the exit from no longer strategic countries with like-for-like sales growth, and to improve profitability.

"From the outset, we wanted to lay out a strategy for rethinking our business, based on discontinuity and renewal,” said Alessandro Benetton, Chairman of Benetton Group, “without, of course, forgetting our rich history. There are early signs, yet we are still only at the beginning of a journey in a marketthat remains uncertain. Today, our efforts are focused on recovering profitability by simplifying the business model and focusing on our brands.”

Benetton

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