Dolce & Gabbana relying on new APAC CEO to relaunch China business
Dolce & Gabbana has restructured its Asian organisation, with a view to making up the ground it lost in China. Last June, following the storm that erupted in China as a result of a controversial advertising campaign, the Italian luxury label hired Carlo Gariglio to oversee its business in Asia-Pacific. The Italian manager has a significant experience in the luxury industry, having worked in Japan for several labels in the course of over 20 years.
Until earlier this year, Gariglio had been in charge of Salvatore Ferragamo’s subsidiary in Japan and South Korea. After gaining an Economics degree from Milan's Cattolica university, Gariglio started his career at Ermenegildo Zegna, where he worked in the finance department for nearly 10 years, before the luxury menswear label sent him to Tokyo, as the chief financial and operating officer of its Japanese subsidiary. In 2005, he moved to Max & Co. as the president and CEO of Max and Co. Japan, and in 2009 he was appointed president and CEO of Alfred Dunhill Japan. He took on the same role for Cartier Japan from 2013, before joining Salvatore Ferragamo in 2017.
As the new president and CEO of Asia-Pacific for Dolce & Gabbana, Gariglio has the delicate task of winning back market share for the label, especially in China, where it has suffered heavy losses. Sales in Asia-Pacific accounted for 22% of global revenue in the 2018-19 financial year, compared to 25% in the previous one, and the group has forecast a new sales downturn in China for the 2019-20 financial period.
According to a luxury industry expert, “business in China is recovering very slowly for Dolce & Gabbana.” It is estimated that, before the boycott on the brand triggered by the controversial video ads in November 2018, annual sales by Dolce & Gabbana to Chinese customers were worth approximately €450 million. Globally, the label generates a revenue of €1.3 billion, 80% of it through exports.
In a recent interview with Italian daily paper Corriere della Sera, founders and designers Domenico Dolce and Stefano Gabbana said: “China is recovering. After mistakes were made, things ground to a halt, but now it is all starting up again. Our clothes remain a quintessentially Italian dream for clients worldwide.” They added: “Brazil and Mexico are performing very well. When some markets slow down, we compensate thanks to growth in other markets.”
Dolce & Gabbana has 220 directly operated monobrand stores and 80 franchised ones, as well as 300 multibrand clients. E-tail accounts for 6% of its total sales. The company employs 5,500 people and, indirectly, it provides work for another 25,000 through its network of 200 sub-contractors and suppliers. Dolce & Gabbana has four factories in Italy: in Legnano and Lonate Pozzolo in Lombardy, in Incisa Val d’Arno in Tuscany and in Sarmeola di Rubano in Veneto, a recently acquired manufacturer specialised in couture and bespoke clothes.
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