Wintex Italia, the company that took over the management of the Sergio Tacchini brand four years ago, has stopped working with Sport Finance as its licensee in France, which used to be the second-largest market for the brand in the old days, and replaced it with another French licensee, Movin, which has done a good job for the brand in Algeria and other countries in Africa, the Middle East and the Balkans.
François-Xavier Chupin, the president of Sport Finance, regrets the decision, considering that his company had succeeded in getting the brand sold in 600 stores, generating an annual turnover of €8 million, thanks in part to important sponsorships like the Montecarlo Rolex Masters tennis tournament. Ten months ago, when he found out about the termination of the agreement, Sport Finance decided to stop also the distribution in France of Prince, which is now handled from the U.K.
Sport Finance has decided to concentrate more of its efforts on its Kappa license, which covers France, Switzerland, the U.K., Spain and Portugal. Discussions are taking place with the brand's owner, BasicNet, about a possible extension of the agreement, after an increase in annual wholesale revenues from €40 million to €63 million in the past three years. It is doing particularly well with Kappa footwear, which represents 60 percent of the turnover, with team sports and lifestyle apparel. Premium styles from the Kappa Kontroll collection have been sold in the famous Colette store in Paris.
Kappa has sponsorship agreements with more than 30 football, rugby, basketball and sailing teams in the countries covered by Sport Finance. It recently took the place of Adidas as the sponsor of a French first division football club, FC Lorient, joining those of Bastia and Angers in the same league. The new contract lasts until the 2021-22 season. Kappa will also be the technical sponsor of a Spanish women's football club, Kappa Santa Teresa CD, under a new three-year contract.
For its part, Wintex says it had ended the deal with Sport Finance, which covered France as well as Belgium, because of differences over the positioning of the Tacchini brand, which is different from the image being given to it in other markets where it is doing well. While Sport Finance was covering also the mass market, as it has been doing with Kappa, Wintex wants to concentrate on the medium segment of the market, feeling that Tacchini cannot compete with the privatel label offerings of many retailers.
All the products are designed in Italy by Wintex, about half of whose 15 employees were working with Sergio Tacchini before it went under. In contrast with the business model adopted by BasicNet and Sport Finance, the same collection is sourced from the same factories and offered for sale worldwide.
Besides, its new agreement with Wintex will provide Movin with greater economies of scale for its operations in other countries such as Serbia or Saudi Arabia. Its annual revenues from the Tacchini brand amounted to only about €3 million until recently.
Movin has been very dynamic at the retail level. A few weeks ago, Movin opened a Sergio Tacchini store in the Al Garawi Gallery in Jeddah. It already manages various Tacchini store corners in Algeria and various Balkan countries. Tacchini had closed all its numerous stores in Italy and France a few years ago but a few days ago one of its licensees, United Brands Company (UBC), opened a branded shop-in-shop inside one of the major sports shops in Milan, Leoni Sport.
Tennis-Point, Tacchini's licensee for Germany, Austria and Switzerland, already operates a dozen Tacchini corners in its territory. The brand's new licensee for Japan, Tamurakoma, has opened 50 Tacchini corners in AEON department stores in the country.
The Tacchini brand generated wholesale-equivalent sales of €43 million in the rest of the world last year through its licensees, driven by increases of 40 percent to €15.5 million for apparel and 18 percent to €14.5 million for cosmetics, watches and textile accessories.
After pulling the brand out of the mass market in the U.S. and Southern Europe, sales of Tacchini branded footwear declined last year by 28 percent to €13 million. UBC, which has the footwear license, is investing heavily to reposition it for distribution in better sporting goods stores, especially in Germany, Italy and France, but no major results are expected until 2018.
For this year, Wintex Italia has budgeted flat sales of €13 million with footwear, €17 million for apparel and €16 million for accessories, leading to a total wholesale-equivalent turnover of €46 million for the year.
Sergio Tacchini, which celebrated the 50th anniversary of the brand last year, has been the property of a Chinese investor since 2008, but is not yet distributed in China. Preliminary discussions are being held with potential licensees for that market for a possible introduction at the end of 2018. As previously reported, the Batra Group recently became Tacchini's new licensee for the U.K. and Ireland. Other licensing agreements should be announced in the next months.
