Luxury brand Brioni, renowned for its men’s formal wear, is facing significant challenges due to the impact of the COVID-19 pandemic on consumer behavior. As a result, the company is planning to lay off 320 employees across its production plants in Italy. Brioni’s competitors in the Italian men’s ready-to-wear market, Corneliani and Pal Zileri, have also been affected by these changes.
To address these difficult circumstances, Brioni has developed a new restructuring plan as part of its 2021-2025 business strategy. The plan was presented at a meeting attended by representatives from the Italian Ministry for Economic Development, the Ministry of Labour, the regions of Lombardy and Abruzzo, and trade unions.
Brioni recognizes the significant transformation that the luxury men’s formal wear market has undergone in recent years, a transformation that has been further exacerbated by the ongoing pandemic. Sales in this segment dropped by an estimated 30% last year, according to industry estimates compiled by Altagamma.
This is not the first time Brioni has faced difficulties. Since its acquisition by Kering in 2011, the brand has experienced a significant decline in sales and production volume. In 2016, the company announced plans to reduce its workforce by a third, impacting around 400 employees out of its total workforce of 1,150. However, only 140 people were ultimately affected by the restructuring plan.
Despite investing in marketing, events, and creative direction, Brioni has been unable to fully recover. The brand attributes this to excessive production capacity and an unstable imbalance of industrial costs within the luxury men’s formal wear sector. In an effort to maintain its presence in Italy and uphold the high quality of its products, Brioni has determined that it must streamline costs and restructure its three production sites in the Abruzzo region.
Brioni plans to lay off up to 320 workers directly and indirectly involved in production to implement necessary actions for the brand’s recovery and development. However, the brand remains committed to producing products that are 100% made in Italy.
As part of its new strategy, Brioni aims to expand its presence in accessories and other product categories, particularly luxury casual wear. This expansion seeks to broaden the brand’s customer base and shopping potential. Additionally, Brioni plans to optimize its investments in communication and distribution channels, streamline overhead costs, and reorganize production to achieve long-term efficiency and profitability.
Under the leadership of Mehdi Benabadji, who assumed the role of head of Brioni in 2020, the brand has entrusted its collections to Austrian designer Norbert Stumpfl since September 2018. In 2019, Brioni collaborated with Brad Pitt as a brand ambassador and recently launched a capsule collection with the actor.
This latest restructuring plan and strategic focus are crucial for Brioni as it navigates the challenges posed by the pandemic and secures its future in the luxury men’s formal wear market. While the road ahead may be challenging, Brioni’s dedication to maintaining its high production quality and made in Italy ethos will undoubtedly play a pivotal role in its ongoing development and success.
Useful Links:
1. Brioni Appoints Mehdi Benabadji as New CEO
2. The Future of Brioni
