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Mar 13, 2020
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Gucci closes facilities in Italy; LVMH to continue operations

Mar 13, 2020

The Italian government's decision on Wednesday evening to close the country, along with its commercial sector, in order to curb the spread of the coronavirus epidemic has given some companies something of a dilemma to work through. Even those that aren't directly affected by the new containment measures are faced with the question of whether to continue with their operations or put them on pause. The issue is of particular importance for the luxury industry, as Italy has become a real hub for the sector, both in Europe and on a global level. 

The Gucci ArtLab, the brand's centre for experimentation - Gucci

Kering's flagship brand Gucci was the first to announce that it was putting its manufacturing activities on hold in Italy, where the brand has six production sites between Tuscany and Marche. "As a precaution to protect public health, the factories will remain closed until 20 March, but activities essential to the maintenance of our business will continue. This temporary closure will not affect the supply of our products to clients," explained the fashion house. 

Over the last few days, Gucci has also been encouraging its office employees to adopt flexible working practices, from remote working to the introduction of a four-day work week, from Monday to Thursday. As for the brand's commercial activities, all of its Italian stores are closed until 3 April, in line with the measures imposed by the government. The brand has, however, emphasised that it will continue to serve its customers "via Gucci.com and with the help of our customer support service."

Gucci is not the only one of Kering's brands based on the peninsula. The French conglomerate's other Italian brands include Bottega Veneta, Brioni, Pomellato and Dodo, not forgetting Kering Eyewear, which is based in Padua, in the Veneto region, and develops and produces the group's eyewear collections. 
Other brands owned by the group count on Italian manufacturing facilities, such as the leather goods factory recently opened by Saint Laurent in Scandicci, near Florence. Kering does not currently wish to discuss its plans for the rest of its facilities in Italy, offering only a terse "no comment."

"Protect workers by having fewer people working together, but with more shift changes."

Over at  LVMH – another luxury giant that's very active in Italy – the plan is not to stop operations. From the production of Louis Vuitton footwear in Fiesso d'Artico, Veneto, and factories for Fendi in Marche, and Berluti in Ferrara, to the manufacture of Bulgari jewellery in Valenza, Piedmont, and of leather goods in Tuscany, principally for Fendi, Bulgari and Celine, all of the group's factories on the peninsula, including Thelios, the joint venture run by LVMH in Veneto with eyewear maker Marcolin, will "remain 100% operational", as confirmed by the company to FashionNetwork.com.

Bulgari's factory in Valenza is continuing operations - LVMH

"Naturally measures have been taken to protect workers by having fewer people working together, but with more shift changes," emphasised the group. LVMH currently employs some 11,000 people in Italy, a figure that has doubled in the last five to six years, and operates 30 production sites. Although these sites are remaining open, this is not the case for subcontractors linked to the luxury industry, many of whom are suffering from the effects of the epidemic. The small craftsmen and SMEs working for the sector in Italy have already noted a decline in their orders. 

Giorgio Armani closed its factories in Northern Italy for a week at the end of February in order to disinfect them, but operations have since started up again. As for Tod's Group, the company told its suppliers that it was closing all of its Italian factories for five days until Monday, 16 March, according to the local press.
It's difficult to find luxury executives willing to speak on the subject, but Giuseppe Santoni, CEO of luxury footwear company Santoni, has offered a snapshot of the kind of actions being taken. In an interview with the Corriere Adriatico, he outlined the measures being implemented in his company's factories, including the obligatory wearing of masks, the constant disinfecting of workspaces, the reduction of travel, the division of workers into five shifts of small groups, and the use of multiple entrances and exits. 

The government's decision to allow factories and other manufacturing activities to continue their operations, while whole sectors of the economy, such as commerce, have been halted, has not been well received by workers. On Thursday, the day after the introduction of the stricter measures, a number of spontaneous strikes occurred throughout the country. 

Several groups of workers protested the lacking measures being implemented to protect them in factories, as well as the impossibility for many of them to work effectively under certain conditions. Others denounced the apparent double standards of the measures being taken to protect different social classes. Such was the case of workers at the factory of historic menswear brand Corneliani in Mantua, who refused to work on Thursday morning, as reported by the Repubblica website. 

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