Lingerie chain Hunkemöller has managed to increase its 2013 turnover to 272 million euro, but its net loss also grew to 2.6 million euro, a quarter more than the losses in 2012. With another 500 new German stores, the chain hopes to turn the situation around.
From sales party to designer
Hunkemöller has had both good and bad news. The good was that its turnover grew from 252 million euro to 272 million euro, but its net loss also increased from 2.07 to 2.6 million euro. That is Dutch business paper FD's conclusion after it browsed through Hunkemöller's numbers.
The turnover increase is mostly because the chain opened another 47 stores, which means Hunkemöller now has 596 stores in the Netherlands, Belgium, Luxembourg and Germany. The increased losses are mostly because of the chain's transformation in the past few years. "The company that used to sell practical underwear has turned into a serious lingerie brand gunning for the higher echelons of the market with its own designs", FD writes.
It costs more to create your own collections and bring them to market, but CEO Philip Mountford believes it is essential because he feels the middle segment will die out. "We notice that luxury brands are performing exceptionally well and that discount brands are performing equally well, but the middle segment - once the heart of retail - is shrinking", he told Fashion United.
500 new stores in 5 years
The French investment firm PAI Partners purchased Hunkemöller in 2010 for 260 to 280 million euro from Maxeda and with Brit Mounford at its helm for the past 5 years, it has focused on Germany. He wants to open another 500 German stores in the next 5 years, as there is still growth potential and "obviously, because it is a big country".
Currently, Hunkemöller is ranked number 4 in Germany, but Mountford wants to become the country's largest lingerie retailer. According to Mountford, the chain should be able to take advantage of its brand name as plenty of Germans believe it is a German brand.