Sole Bearing

Italian shoe label Sergio Rossi new CEO wants to bring sexy back

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Riccardo Sciutto understands the profound relationship between a woman and her shoes. That’s why, to know a woman, he will glance at her feet. Her choice of footwear reveals more than where she is going or where she has been to.

“You can understand a lady a lot with her shoes,” Sciutto said. To illustrate his point, he pointed at a working woman wearing white moccasins. “For a lady to wear flats, she is projecting self confidence. She dares to break the mold.”

The almost psychic ability to decipher a woman’s mind is a necessary occupational hazard. Sciutto is chief executive of the Milan-based footwear company Sergio Rossi.

The label is known for its high-octane creations that add oomph and unabashed glamor to the female wardrobe. Its iconic monotone stilettos and thigh-high boots are must-haves for the well-heeled.

Sex appeal is the name of the game, and Sergio Rossi excels in it. However, Sciutto is attempting to redefine sexy.

“Wearing short skirts and high heels was the definition of sexy. We need to destroy that preconception,” he said. “Today the ladies are much more confident and ready to live life. They can wear pants and shorter heels and still look sexy.”

The past year saw great changes at Sergio Rossi, with ownership changing hands from the Kering Group to Investindustrial in December 2015. The private equity firm also retains the car manufacturer Aston Martin and furniture company B&B Italia in its investment portfolio.

Sciutto was appointed in April 2016. A fashion veteran, Sciutto brought with him a wealth of senior managerial experience he gained at the jeweler Pomellato.

His credentials in clothes are equally impressive. Born in Bra, Piedmont — an Italian city famous for its wine and truffles — Sciutto came from a family whose company had produced merchandise for Max Mara.

Sciutto has also worked for leather goods and footwear label Hogan, where he pushed forward a project to continue the label’s tradition of making luxury sneakers.

Sciutto had been working with the new owner a year to relaunch the footwear label. He started with a bold proposition: rather than betting on a celebrity designer, he and a team of young designers would lead the creative vision.

“My idea was for customers to fall back in love again with Sergio Rossi. We looked at our DNA, but at the same time, we are thinking about the future in order to establish a new line that would represent a new family of shoes and the rebirth of the label.”

The new collection, called sr1, was conceived with innovative concepts. Exotic sky-high pumps were replaced with wearer-friendly daywear. An example is a new creation that merges the design of moccasin and slipper, and features an elongated tongue.

The collection is evergreen. It will keep expanding every season. But all the pieces added are meant to be season-less.

“Squared-toe is the direction but pointed-toe will be added. There will be different proportions and lower heels. Our shoes are meant for walking,” Sciutto said.

“Modern women are revolving every day. They no longer carry many pairs of shoes for different occasions. They love to have one style that they can wear to work for the entire day. Our heels were 10 or 11 centimeters high. Now, we make more six-centimeter heels.”

While balancing femininity and functionality is the goal, it is a challenge for a company that takes a couture-like approach to footwear. The “beauty is pain” mentality still lingers in high-street fashion. And Sciutto will need to rewrite the book.

“The risk about being a visionary is that at the beginning you may be seen as a little bit crazy. I see what is going to happen in the next one or two years but I need to explain it to the team and get their trust before I can tell it to the customers,” he said.

“For me, shoes are where the magic happens. I can put three ladies in front of you, and by dressing them with different shoes, they will each show a different mentality and attitude. It’s a kind of magic that a dress and a bag cannot give you.”

The article first appeared in the Standard on May 19, 2017.

Brilliant Tactician

Folli Follie’s numbers man has descended from Greek warrior and swapped spears for spreadsheets

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Ioannis (John) Begietis may be known as the numbers man for FF Group, a family-run fashion company that owns the Folli Follie and Links of London labels. He’s the company’s global chief financial officer, and chief operating officer at its Asia-Pacific headquarters.

But little do people know that the Greek is, literally, a present-day Spartan warrior.

He’s descended from a historical military family that can trace its roots back to the reign under Leonidas, the Spartan king portrayed by Gerard Butler in the 2006 film, 300.

Begietis and his brother are the first generation in the family who have exchanged spears and shields for spreadsheets. “Some say my forefathers were the descendants of King Leonidas. My grandfather was an army general. My father was an admiral in the navy,” he said.

“I joined the national service right after my studies in the United States. I was in the air force as a finance officer for two years. I got to try some new anti-aircraft weapons and really cool guns,” the 50-year-old recalled.

Undergoing a different rite of passage – marked by expat assignments in the business world – Begietis relocated to Hong Kong in 2011.

He now oversees about 320 retail stores in East and Southeast Asia, and his main responsibilities include the overseas expansion of Folli Follie.

Folli Follie has been expanding rapidly in Asia, with the Asian market now contributing significant revenues to the Athens-based FF Group. Its annual sales have risen from 300 million euros (HK$2.54 billion) to 1.3 billion euros in the 11 years since Begietis climbed aboard.

In Hong Kong, the label has accelerated the pace of setting up stores in prime shopping districts. Last October, it opened a new outlet store at E-Max WearHouse in Kowloon Bay, followed by another at Florentia Village in Kwai Chung in March. This summer, it plans to add two or three regular stores in the SAR.

Including locations at Horizon Plaza in Ap Lei Chau and Plaza Hollywood in Diamond Hill, Folli Follie now has four outlet stores in Hong Kong.

In the past, brands opened such stores to liquidate unsold inventory but modern practices are changing. Outlet shops form a part of the present-day omni-channel retail strategy of top fashion labels. They stock not only past-season items, but also special collections.

An example is Japan, where Begietis has restructured the Folli Follie brand after the acquisition of a joint venture partner in 2008. A new marketing image and merchandise offers helped the label recruit young female office workers as loyal customers.

“In Japan, we have a sizable number – 16 outlet stores. They are located far away from the main cities. They have not overtaken the local market sales, but are a very profitable segment,” Begietis said. “The most successful outlet venture usually happens in a mature market. You have to have a clientele who knows what the full price items are, and can differentiate them from the special lines or discounted items.”

In the local outlet stores, past-season items account for only 15 percent of the entire catalog. They are sold at a minimum 30 percent discount. The rest are specialty products: for example, men’s watches exclusive to the outlets.

Begietis intends to use the stores to tap a new clientele, and slowly lead them into adopting the habit of purchasing full-price items.

“Everybody talks about the retail business going down, but nobody talks about the local people as a shopping power,” he said. “They are all looking at the tens of millions of travelers coming, which is fantastic. But it’s a chance business. So local customers are always our target.”

Begietis relies on his staff to keep a finger on the pulse of the market. He is one of the few expatriate managers who work at the group’s Asia-Pacific headquarters in Hong Kong.

“I am a tactician. Retail is like chess. You should always make the right steps to go to the top. Of course, when you play a game, you should prepare to lose. But nobody plans to lose. Everybody plans to win.

“I think you have a better chance of winning if you involve the local people. This is true, not just in Hong Kong but everywhere.”

The article first appeared in the Standard on May 12, 2017.

A-List Couple

Meet the couple every Hong Kong fashionistas want to be friends with

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Shopping is a national sport of Hong Kong. So is lining up. If you merge the two together, you will get a recipe for success — at least according Diego Dultzin Lacoste and Delphine Lefay.

The French couple, who moved to the SAR three years ago, founded a flash sale business, On The List, a little more than a year ago, and have carved out a niche in a city which provides a staggering array of shopping options.

A recent event that Dultzin Lacoste and Lefay organized for British fashion label Ted Baker attracted 1,100 people in just two hours. Bargain hunters started to queue up as early as 6.30 am, waiting for an hour and a half to enter.

“The first time we did Ted Baker was during typhoon signal No 8. We really thought it would be a disaster,” Lefay recalled. “But we received phone calls throughout the day asking when we would open. The queue stretched two blocks.”

“We didn’t expect people would come out and shop but we discovered that Hong Kong people are really shopaholics,” added Dultzin Lacoste.

On The List operates on a business model different from traditional flash sale organizers. It does not have online retail but employs a bricks-and-mortar concept similar to outlet operators.

And rather than opening a store in the outskirts, they eyed prime shopping locations.

Two months ago, they set up a two- story shop on Duddell Street in Central, after a trial run of pop-up events. They plan to have other locations in central Kowloon and the mainland next year.

Another key concept is that On The List serves only registered customers. It currently has a membership base of 50,000 and has worked with many fashion and lifestyle labels – including Armani, Calvin Klein, Ferragamo, and Ports 1961.

Members have access to discounted past-season clothing, fashion accessories, electronics, and wines every week. The markdown averages about 75 percent.

“Each flash sale lasts three to four days. The time period protects the brand’s image. And from the brands’ point of view, they are able to sell all the inventory that they have in the warehouse,” Dultzin Lacoste explained.

The store can move a large volume of goods in days. They once helped Brazilian label Havaianas sell 13,000 pairs of flip flops in four days. “Some companies have stopped organizing flash sales themselves because we can sell a lot more,” Lefay said. “We are not competing with their outlets because we have items that can’t be found there.”

The business model that bridges luxury and mass market retail is not new. Dultzin Lacoste and Lefay got their idea from the success cases in France and the United States. But implementing the idea in a foreign market can be tricky.

It took Dultzin Lacoste and Lefay time to find the right strategy. The pair don’t always agree with one another.

In fact, when Dultzin Lacoste first met Lefay, they had a philosophical debate about rational and impulse purchase. Coming from a background in luxury retail, he valued sensibility over sense while she was in the mass marketing industry and preferred rationality.

“Delphine said her industry had much more figures to work with,” Dultzin Lacoste recalled the night they met. “I told her my industry made people dream. It was not only about the products, but the whole package and storytelling. So we had a big argument.”

Said Lefay: “I was not attracted by luxury brands because I could not afford them. I was 23 when we met, freshly out of university. Now, I can see why people are attracted to luxury products – with a good price. Diego has convinced me.”

Even so, the response from Hongkongers was a surprise. Brands have consigned expensive items, such as jewelry and watches. The most costly was a Frederique Constant watch priced at HK$450,000 before discount.

“The biggest order came from a woman who spent HK$92,000,” Dultzin Lacoste said. “She bought five items: a jacket and some jewelry. If she had bought them at the store, she would have paid a lot more for any one of those items.”

The married couple still fight over their own area of expertise. Said Dultzin Lacoste: “We argue about everything, which is good. But it’s more like we are brainstorming.”

Lefay agreed. “When we want to implement a new process, it always starts with an argument. When I want to insist on my idea, I sometimes don’t listen to Diego. But we are complementary.”

The article first appeared in the Standard on May 5, 2017.

 

Feets of Joy

Jimmy Choo: designer to the well-heeled

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There are those who measure their achievements in life by the number of designer shoes they have in the wardrobe.

Then there is Jimmy Choo. Not that the celebrity footwear designer is not crazy about shoes. He has three cabinets filled with stylish shoes at home.

But Choo, a Buddhist, sees life through the lens of benevolence. The goodwill of others has made the Malaysian Chinese the world’s famous footwear icon that he is today. Choo feels obliged to reciprocate by promoting the virtue of education and bringing up young designers from Asia.

“A Chinese saying goes: a master should always have a few tricks up his sleeves, lest his apprentice outstrips him one day,” Choo said after attending a British Council award ceremony held in Hong Kong. “I don’t believe that. A true master shouldn’t be afraid that his proteges would become better than him. I teach mine everything I know. It was how I learnt the craft. My father was my master.”

Choo’s father Choo Kee Yin, an immigrant from Mei County in Guangdong, was a shoemaker. Born in Penang to a Hakka family, the junior Choo learnt about design and pattern-making at the family’s shoe factory.

At 11, Choo made his first pair of shoes: dog-patterned leather flats for his mother’s birthday. “I made that because my mother liked wearing slippers. And my childhood nickname was Doggie,” he said. “Many parents in Malaysia gave their children an animal nickname, hoping they would grow up strong like an animal even in difficult circumstances.”

Although Choo moved to London in his teens and lives there ever since, he hasn’t forgotten his roots. He speaks fluent Cantonese and Hakka. And after selling his shares in his eponymous label in 2001, he started another company named after his Chinese name, Zhou Yangjie.

“I used to speak Cantonese a lot in London because there were a lot of Hongkongers there,” said the 68-year-old. “Most restaurant staff spoke Cantonese. Some spoke Hakka.”

London made Jimmy Choo famous. In 1983, he graduated with a degree in footwear design at the Cordwainers Technical College, today’s London College of Fashion. Three years later, he opened Lucky Shoes in Hackney.

Choo’s father-in-law suggested the name. Choo is married to a designer from Hong Kong.

“My father-in-law said the name would bring me good fortune so his daughter wouldn’t starve,” he recalled. “I was quite handsome when I was young. So I didn’t need much effort to court my wife. When we were dating, she often invited me to her place for dinner. She said Hongkongers are good at making soup. In return, I made her shoes.”

Good fortune didn’t come immediately – even though Choo was selling his handmade shoes at £50 (HK$472) a pair. “No one wanted my shoes because I was a nobody. My parents gave me their retirement savings to keep the business afloat,” he recalled.

To make ends meet, Choo went into making cheap sandals and uncredited pieces commissioned by theater producers and famous fashion designers. Although his creations would appear in fashion magazines, he was only paid £6 per pair sold.

Luckily, it didn’t take long for his reputation to grow. Within two years of opening Lucky Shoes, his works were featured in an eight-page spread in the UK Vogue. Then Choo went into business with society girl Tamara Mellon – and the rest was history.

Throughout the years, many celebrities and royalty have stopped by Choo’s shop – Princess Diana, the queens of Jordan and Brunei, Michael Jackson, Kylie Minogue, and Kristin Davis, to name a few.

“When Katie Holmes was in London for the premiere of Batman Begins, she visited my shop on 18 Connaught Street,” he said. “Turned out, that location really brought me good fortune.”

Choo’s niece Lucy Choi has taken over his London shop but he is still accepting bespoke orders from close friends. “I’ll never stop making shoes – not even when I am 100.”

When he is not busy entertaining clients and scouting for young footwear talents, he would fly to Kuala Lumpur to get his suits and shirts made at Lord’s Tailor. The man is, in his own right, a purveyor of fashion.

“Being a designer is not only about making fashionable shoes. It’s also about making shoes that bring joy, comfort and a sense of wholesomeness.”

The article first appeared in the Standard on March 10, 2017.

Razzle Dazzle

How Carat London grew to become a mega global jewelry brand

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In the eyes of an outsider, Scott Thompson, a long-time Hong Kong resident, had a pretty good stroke of beginner’s luck when the former pilot decided to dive into jewelry retail without any relatable experience.

Even the Briton himself agrees.

“Piloting does not set you up for doing any businesses,” he said. “In fact, pilots are the worst investors next to doctors when they retire. They usually lose most of their money on some crazy business ideas.”

Lucky for Thompson, he was an exception.

His jewelry brand – Carat London – has grown to become a global name today. The brand has more than 250 retail locations worldwide today, employing 140 staff across three countries.

In the last two years, it has opened in over 40 new locations worldwide. It has also ventured into travel retail in Asia after signing up the Hong Kong-based DFS Group. Another achievement is that pop stars Rita Ora, Ellie Goulding, Lily Allen and Lady Gaga all wore Thompson’s pieces.

Thompson, the son of a pilot and a realtor, founded the jewelry brand in 2003 when he was 28. His first retail store was installed in the street of Lan Kwai Fong.

“I saw a sign on the door. So I called up the landlord and did the deal directly. I did not use a real estate agent,” he recalled. “My mother is a very successful entrepreneur. I learnt from her about how to negotiate.”

Not long after he rented the three-story space, the SARS outbreak ravaged Hong Kong. Although Thompson was able to negotiate the contract down to HK$100,000 a month plus a big rent-free period, his friends thought he had gone “completely bananas.”

That’s because he was building the appeal of Carat London on three seemingly discordant propositions: women’s jewelry designed by a man, fine jewelry at affordable price, and laboratory-created diamonds, not natural ones.

“When we first launched the business, everything we did was in 18-karat gold because, back then, gold was quite cheap at US$220 an ounce,” he recalled. “And we were doing very high quality, hand-cut stones.”

Lane Crawford was the first major business customer. In 2008, the brand opened its first overseas shop in Covent Garden. Shop-in-shop deal with department stores Harrods and Selfridges quickly came.

And when wholesalers approached for partnership opportunities, he thought it was time to open more free-standing locations in Canary Wharf and Burlington Arcade in Mayfair.

Good times did not last. As the financial crisis came, Carat London struggled like everyone else. “I saw a lot of retailers going out of business during that time,” Thompson said. “I remember in one particular shopping mall where we had a shop, almost every shop around us went bust, starting with HMV.”

Britain, where 70 percent of its revenue comes from, is a major market. Thompson believes there is still room for the firm to grow there. However, Asia is a different story. While Thompson does want to build a bigger presence in Hong Kong and the mainland, he remains cautious, calling the two markets “an experiment and a proof of concept.”

“The Asian market, and Hong Kong in particular, has been difficult,” he said. “China is okay, not doing quite as bad as Hong Kong.”

This month, he opened his sixth local store in the V City shopping mall in Tuen Mun. The move signifies a new model of operations – venturing into non-core tourist districts to tap “regional opportunities.” A similar strategy will be deployed in the mainland.

Also, the brand has been trying to hasten production, building in faster and trend-driven product cycle to drive customers’ spending. At the moment, it releases six to eight collections – 300 to 400 pieces – every year. That’s almost one item every day.

Thompson has since designed more accessible collections, such as Heroines and Stella, to woo younger women. His wife Heidi, who manages marketing and public relations at the firm, helps out as a sense checker.

“We can’t rely on a single purchase to make our budget. Our business is about agility and tactics,” he said. “We try to be not ahead of a trend, but when something is trending, we hit it right.”

The article first appeared in the Standard on December 2, 2016.