Italy’s luxury groups set aside rivalries to keep it local

Newswire

Milan: Italy’s luxury fashion groups, which for decades jealously guarded their independence, have started teaming up to protect their supply chains and the Italian roots of smaller companies, showing a new spirit of collaboration.

Control of the supply chain has become increasingly important for luxury brands, ensuring products get to shops on time and avoiding reputational risks linked to sourcing of raw materials or labour conditions.

Italy’s patchwork of specialist artisan workshops and family-owned labels offer particularly rich pickings for larger companies with the cash to cement relationships through investment.

In this spirit, Prada (1913.F) and fellow Italian fashion brand Ermenegildo Zegna (JN0.F) in June acquired a minority stake in knitwear company Luigi Fedeli e Figlio, based in Monza, just north of Milan.

The family-owned company, which has a focus on cashmere and jumpers, was founded in 1934 and is distributed in 13 own-brand boutiques and around 400 multi-brand stores worldwide.

Prada and Zegna had previously invested jointly in Filati Biagioli Modesto S.p.A. in 2021, acquiring a majority stake in one of their suppliers, specialised in the production of cashmere and other luxury yarns.

“We invested in Biagioli to relaunch a company that was in crisis, while for Fedeli it’s a case of helping the company to grow,” Patrizio Bertelli, leading shareholder and chairman of Prada Group, told Reuters.

Bertelli, 77, added that smaller Italian companies have in the last two decades had to juggle the handover from one generation of the family to the next with more complex issues such as expanding in new markets.

“Italian brands have wanted to go it alone for too long, and then suddenly they realise you can’t always go it alone and you start to look around,” he added.