D&K Distribution is taking over gradually Conte of Florence, an iconic Italian brand of sports clothing with 60 years of history in the sector. The process should be concluded by mid-2013, after a settlement with the bankrupt company's creditors, but D&K has already agreed to take over its management, starting last Oct. 1. D&K's chief executive, Massimo Tassinari, has taken the place of Renato Guardini as chief executive of the company on an interim basis, pending the appointment of a new general manager.
The first contacts between the two companies date back to March, when the Florentine brand was experiencing a severe crisis due to the changing market, the difficult economic situation in Italy and the need for a generational change: the company was controlled by the family of the founder of Conte of Florence, Romano Boretti, is now 75 years old.
Under the terms of an agreement with the company's receivers, D&K has formed a new company, Conte of Florence Distribution, which will manage the commercial distribution of the Conte of Florence brand, both at retail and wholesale, until its assets change hands and its debt is settled. The agreement followed the voluntary liquidation last August of Florence Sportswear, former owner of Conte of Florence.
Neverthless, D&K has already agreed to make investments of €10 million into the brand to revitalize it. The longterm plan is to raise its sales to €100 million in three years' time from this year's level of less than €45 million, with most of the growth starting in 2014, driven by expansion into new markets such as China, Japan and South Korea. The export rate is set to grow from 35 to 50 percent.
To help accomplish this, D&K is providing its know-how in product design and marketing. Synergies are expected in sourcing and international distribution. D&K expects to end the present year with sales of €24 million, 40 percent of which should be generated outside Italy.
The new owners also envisage expanding the number of Conte of Florence stores, starting in July 2013, and to apply an innovative concept which would be later replicated in the existing stores. China and Japan will be the primary targets for the new store openings.
The Italian retail network of Conte of Florence currently includes 40 directly operated stores, 20 franchises and 16 outlets, plus 600 wholesale accounts. Outside of Italy, Conte of Florence has five mono-brand stores between Bulgaria and Russia, two franchises and 400 multi-brand clients.
Based in Tuscany like Conte of Florence, D&K Distribution specializes in casual outerwear. Its clothing is sold under trademarks such as Dekker, Dek'Her, Kejo, D21, D-Twice, and 10East. The company was founded in May 2006 from a collaboration between Tassinari, a former official of Geo Spirit and current chief executive of D&K, and Riccardo Coppola, a fashion designer. Kejo stands for casual down-filled outerwear. Dekker for men's and Dek'Her for women stand for military-inspired fashion clothing.
The first Conte of Florence collection developed with the collaboration of D&K's team will be marketed for autumn-winter 2013-2014. A preview will be presented at Pitti Uomo in Florence, on Jan. 8-13, and the full collection will be presented at Ispo in Munich in February. A new creative team is already working to add new products to the basic collection as well as to capsule collections for golf, skiing and canoeing, the brand's key sports.
Conte of Florence experienced its boom in the mid-seventies, when it became a sponsor of the Italian ski national team. Its popularity increased in the 1980s, when the company entered the world of golf.
D&K has been specifically attracted by the distribution structure of Conte of Florence, which is mainly focused on directly operated stores, which the new management intends to maintain. In contrast, the distribution structure of D&K is mainly wholesale-driven.
