3 Aug 2012
Polish fashion sector still brand crazy
|Brand building underway. (Photo courtesy of ©iStockphoto.com/ juanmonino)|
The boom of the 1990s, when local and international brands charted the Eastern European markets, ended up in market consolidation. Currently, global companies and regional leaders dominate the Polish scene.
Competition has since stiffened, consumers have become choosy and the Eurozone crisis has destabilised major international players.
Also, investment in the fashion business has become more risky, costly and requiring long-term calculation. Branding is more important than ever.
Companies are either putting their money into brand building or are acquiring brands that are already recognised.
The Polish fashion market has opened up to high-end international brands, which has caused major realignments.
Polish brothers Arkadiusz and Krzysztof Bajolek, Jan Pilch and Adam Skrzypek have been particularly successful as brand builders. The Bajoleks and Jan Pilch successfully launched chain stores for fashion-conscious teenagers under the Mohito and House brands.
They sold their company for around Euros100 million to LPP in 2008, when the chains jointly comprised 260 stores in Poland and 100 abroad.
Later, instead of launching a new chain they decided to invest in existent ones because chains run under brands were losing popularity among Polish consumers. So, they created Bytom, Gino Rossi and Simple Creative Products (SCP).
The programme to develop brands as the European economic crisis hit was difficult, but turned out successfully in all but one case.
Bytom gained recognition as a conservative, high-end, men's wear brand. The fashion wear brand, SCP, too, won youth appreciation and soon became the pillar of the Gino Rossi group.
However, the shoe division of Gino Rossi has slowed markedly since last year and only a buyout of competitor Kazar seems to have been well-received by investors.
Investor Pilch seems to recognise the limitations of the Gino Rossi brand and his strategy is to move it eastwards to Ukraine and Belarus where global luxury brands are less available.
Having successfully built up the Reserved and Cropp brands, LPP concentrated on acquiring chains which already enjoyed recognition despite disappointing sales.
New purchases - Mohito and House - have constantly grown. The company also profitably sold Esotiq, a franchise chain incompatible with LPP's model.
LPP's largest chain is Reserved (with 304 stores). The youngest, smallest and fastest developing is Mohito.
LPP now expects net profits of Euros71 million this year after opening 160 stores in Russia by the end of last year, with 2011 turning out to be a banner year for profits.
In 2013, LPP is to launch a new clothes and accessories chain store for young women.
Bamboo eco fashion
|The new, green look. (Photo courtesy of ©iStockphoto.com/kzenon)|
Bamboo wear is emerging as the most promising niche for the mid- and high-end fashion market.
Without much advertising, bamboo underwear has appeared in numerous online and traditional stores and has sold really well.
Bamboo clothing is considered functional and ecologically sound. Less water and pesticides are used for bamboo than for cotton, while bamboo is held to have antibacterial qualities, is light, soft and resistant to tearing.
Bamboo thread has appeared on the Polish market as a basic component of sports underwear, socks and, most recently, high fashion.
The pioneers among sock manufacturers and importers are RiSocks (which is online as risocks.pl) and Wola (or www.wola.pl).
These leading manufacturers have recently been joined by Regina (regina.low.pl), another big producer.
In each case the bamboo collections are the season's best sellers. Men's bamboo socks in dark colours are the most popular. Surprisingly enough, bamboo novelties are freely available to average Polish consumers.
Bamboo sport sweatshirts and lingerie have also been a big hit in Polish sport stores.
Tencel, a new fabric composed 70% of bamboo, is joining the range of high-tech sport materials such as Gore-Tex, Polartec, Lycra and Spandex.
Since designer Luiza Jacob appeared on the cover of Wysokie Obcasy, a weekly women's magazine, every Polish city dweller has learned about her brand Dream Nation (www.dreamnation.eu).
Many consumers have already placed orders for bamboo leggings and jumpers. Most importantly, Jacob's imaginative designs and strong commitment to ecology have opened up the Polish market.
Dream Nation is going global. Jacob revealed her plans for the upcoming season: the next collection will not just be shown in Poland but also in the US.
from Gabriela Chan, Warsaw Consultant
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