Vicunha refocuses on Europe
Vicunha was back this year at Munich Fabric Start, which began on Monday—specifically in the Blue Zone after a half dozen-season absence.
The Brazilian denim giant also announced that it will return this May to Denim by PV in Barcelona. "The reason for our absence is simple and positive. We’ve been focusing on our development in Latin America and our production capacities weren’t great enough to target new European customers at all costs. But now the focus is on internationalization. Europe is not easy, but it’s an important market," said Thomas Dislich, managing director of Vicunha Europe.
Besides participating once again in trade shows, the denim maker has reshuffled its organization in order to optimize costs. It established a subsidiary at the end of 2014 in the Netherlands, although Vicunha Netherlands won’t become operational until next spring. The goal is improved inventory management and logistics, which have long been managed from its European headquarters in Switzerland, where, as a result, its team has dropped from 16 to 7 people.
Besides costs linked to the spike in the value of the Swiss franc, this decision allows the company to be closer to the contractor that manages a permanent stock of over three million feet. It is also tied to the concentration of its business with regards to certain key clients.
"Ten years ago we had 300 active customers in Europe. Today, with ten major clients, we cover two thirds of the mid-range market. However, we have to be as close to them as possible. Before, we largely needed agents. Now our sales teams have the profiles of key account managers," said the executive.
Thomas Dislich said that in ten years, Vicunha’s net sales worldwide had doubled to 443 million for a net profit of 38 million.
Le Vieux Continent, où il travaille avec une cinquantaine de clients, n’en pèse que près de 4 %, soit environ 16 à 17 milions d’euros. D’ici à quatre ans, il vise la barre des 50 millions. Il espère, rien que cette année, enregistrer un bond de ses commandes en volume de 25 % à 9 millions de mètres.
Europe, where he works with some fifty clients, only makes up about 4% of the company’s business, or about 16-17 million euros. Within four years, Dislich plans to see that number rise to 50 million. This year alone, he is aiming for a 25% jump in orders by volume to 30 million feet.
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