JOHN SAILER: Since you’ve been with Safilo, what changes have you made at the factory level?
LUISA DELGADO: Safilo started its craftsmanship in 1878. Although we had a different name and evolved since, the heart of Safilo’s reinvention strategy is product, brand-driven and design-inspired of renowned and sophisticated craftsmanship.
We’re proud of our Italian re-industrialization because Safilo’s industrial powerhouse made us big. In the 1930s, Safilo invented the scaled production of glasses.
We are nurturing this competitive edge by investing heavily in our plants. When I arrived over three years ago, our three Italian plants were working at half capacity with the other half subsidized by the state. The strategic challenge I had was how many to shut down. It was sad because we discovered we were buying 70% of what we were selling from outsiders. It was also encouraging because there was volume.
Our plants had not been invested in for many years and, as a consequence, we were not competitive. That’s why we were buying from the outside.
Now, not only have we filled out three plants and started to modernize them, but we also bought a fourth one that makes lenses with graphic designs and colors.
SAILER: You’ve also recently introduced 3D printing.
DELGADO: This comes from two angles. One is an Israeli company with whom we partner. We test their machines in our prototyping and, in the process, we discovered we wanted to make 3D sophisticated by combining it with metal frames as well as colors and, as such, came up with a totally new look for our Oxydo Lab collection, which now leads with Elie Saab, our atelier offer.
SAILER: Licensing changes continue. What are you experiencing?
DELGADO: After a lot of reflection, we declared that we wanted to become brand stewards. I have signed five or six licenses in the past three years, and when Elie Saab entrusts his brand, he entrusts his most precious asset, his name. He expects us to understand,
cherish and nurture his brand.
The licensing of 20 years ago, where the licensee drives volumes and the licensor controls it, are over. We manage design, product creation, manufacturing and distribution in a way that enhances brand equity.
We signed Rag & Bone, which we targeted because these up-and- coming brands will not remain niche but appeal to Millennials who look for brands that are not so big as their father’s, mother’s or grandfather’s brands. Swatch is also a different type of partnership than a license, and that works very well.
SAILER: You’re also relaunching Safilo brands.
DELGADO: They are our history. For many years, Safilo was enamored only with licenses. It was perceived as more sexy than working on our own core brands. We have changed that, and today we put our best people on our own core brands, from Carrera to Polaroid, Safilo and Smith. In the U.S. we also focus on brands such as Elasta Emozioni and Chesterfield. We see our core as our house brands, representing between 40% and 50% of our business.
SAILER: What changes are occurring in the U.S. market?
DELGADO: The U.S. is our most important single market worldwide, and in the past nine months Safilo has put an enormous focus behind building an organization that can lead trust with our ECP retail customers, chains, associations and all the customers who wish to provide quality product.
Having a choice of brands is key for an ECP in order to have a business model to win in the market. ECPs have a lot of pressures. They have people who want to tell them what to do, but it’s actually the ECPs who want to run their business in a way that has them in charge of what they offer, how they offer it and the service they provide. Safilo is truly committed to ECP choice, flexibility and independence.