Armani gains direct control of UK sales business

(Reuters) – Fashion designer Giorgio Armani is taking direct control of his sales business in Britain to improve efficiency in the retail sector, which has become a revenue-spinner for luxury makers amid economic turmoil.

Armani said in a statement on Tuesday he had agreed to take control of his UK wholesale and retail business from long-term retail partner Club 21 after 23 years of cooperation.

The 1.8-billion-euro Armani empire is among top luxury makers that have moved to manage their businesses internally, reducing costs in the long term and boosting profitability.

Singapore-based Club 21, which manages brands such as Donna Karan, Balenciaga, Dolce & Gabbana and Paul Smith, will retain distribution of the smaller Armani Exchange sporty line.

“It is now time that a global brand like Armani runs its own interests in a market as significant as this one,” the designer said, ushering in a “new era” for his business in Britain.

Luxottica, the world’s biggest maker of designer sunglasses for brands including Giorgio Armani, is to spend more than 200 million euros over three years to increase production and cut delivery times to keep up with fast-moving fashion trends.

From Prada to Salvatore Ferragamo, top luxury makers have invested heavily in the opening of their own stores, where they have direct control of their sales forces and brand image. Stores are a cash cow for brands if managed well.

The unlisted Armani empire reported a 13.6 percent rise in revenues last year, helped by a 45 percent boost in China, the fastest-growing retail market.

The hands-on designer, who has repeatedly said he has no intention to sell his business, said last month he aimed to grow further this year despite concerns about the euro zone crisis.

The Armani group has six clothing lines, including the top Giorgio Armani collections. It also makes sunglasses, fragrances and make-up.

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