Prada’s heir-designate vows to keep group in family hands
Lorenzo Bertelli, the eldest son and designated heir of Prada CEO Patrizio Bertelli, has pledged to keep the family-controlled luxury fashion group independent when he takes the reins.
Lorenzo Bertelli, a 33-year-old former rally driver, is currently Prada’s chief marketing officer and has helped bolster the group’s digital business, which aims to account for 15% of retail sales in the medium term compared to just 2% before. the pandemic.
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In a presentation to investors last week, his father officially crowned him as his successor, saying he could pass the baton to him in three to four years.
Earlier this year, Patrizio Bertelli described Lorenzo as a “key element in the group’s turnaround” that he and his wife, top fashion designer Miuccia Prada, have put in place to boost sales.
The overhaul strategy, which focused on moving Prada upmarket by eliminating markdowns and reducing wholesale distribution, has paid off and Prada is often cited by rival groups as an attractive potential prey.
However, like his father, Lorenzo Bertelli said the Hong Kong-listed group, in which the family owns 80% of the capital, was not for sale.
“It’s a question for my parents but for me absolutely yes,” he said in an interview that will be broadcast in full at the next Reuters Next conference on December 1, when asked if he wanted to keep the group in family hands.
“I don’t see any other directions, also because I hope I still have a long way to go and therefore I have to do something with my life. So I would like to remain independent”, he added, s ‘voicing at the group’s industrial headquarters and prototyping center in Valvigna, Tuscany.
He did not rule out acquiring other brands, believing that there were no opportunities for the moment, but “tomorrow we do not know”.
And he ruled out, at least for now, the possibility that the group’s main labels – Prada and the young Miu Miu line – sell on Amazon.com, which seeks to attract prestigious luxury names to its platform.
“We tried with one of our smaller brands (Car Shoe) just to give it a try,” he said. “We don’t think Amazon is ready for the biggest brands right now… We don’t see Prada or Miu Miu on the Amazon platform at this time.”
Instead, he reiterated that Prada might be interested in taking a stake in an e-commerce joint venture that Cartier owner Richemont and US online retailer Farfetch are discussing.
Richemont said earlier this month that he was in advanced talks with Farfetch to sell him a minority stake in his online business Yoox Net-a-Porter (YNAP). He added that he would also invite other companies to participate in transforming YNAP into an industry-wide platform without a global controlling shareholder.
A direct investment in the platform “could be an opportunity,” said Bertelli.
The group unveiled last week a medium-term objective of increasing its operating profit margin to 20% of sales, below that of its larger competitors like Louis Vuitton or Gucci and Prada’s profitability margin of 27%. at its peak.
Bertelli said that in the long run, the group could return to that kind of level of profitability. But he said Prada would rather set reasonable goals and, if possible, do even better, rather than aim too high and risk disappointing.
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