MILAN (Reuters) – Italian entrepreneur Alessandro Bastagli set his sights on Shanghai Tang two decades ago and having finally bought the brand in 2017 from Richemont (CFR.S) he aims to increase the group’s sales by 15-20 percent next year.
Bastagli told Reuters on Wednesday he will invest “an important amount” in the brand for its relaunch.
“We bought a Ferrari, we now have to spend money to fill the tank,” Bastagli said, declining to say how much was spent on the acquisition because of a confidentiality agreement.
The Swiss luxury conglomerate sold a controlling stake in the Chinese fashion group to a consortium of investors led by Bastagli last July.
Founded in 1994 by late Hong Kong businessman David Tang as a high-end tailor, Shanghai Tang sold Asian-inspired clothes for men and women as well as accessories and homeware.
The group now has 40 million euros ($49 million) in sales, and 16 boutiques in China, Singapore and Macao, as well as some airport outlets. Its London shop was closed months before the group was bought by Bastagli.
The entrepreneur, who owns Italian brands that make leisure wear, aims to open “a couple” of European shops in the next years, ideally Milan, Paris and London. The aim is to extend its reach in the West and target “Millennials” — young customers born between 1985 and 2000 — who account for almost a third of the luxury market.
Production of clothes and accessories has been moved to Italy while that of homeware items remains in China.
Bastagli concedes that a big investment will have to be made on communication, particularly in Europe, where the brand is less well known, positioning it in a “high-end niche… but not necessarily too expensive.”
The creative helm of the Asian brand was handed to Massimiliano Giornetti, creative director at Florence-based luxury group Salvatore Ferragamo (SFER.MI) until March 2016.
Giornetti told Reuters his first collection for Shanghai Tang, with Chinese-inspired details, quilted pieces, animal-print patterns and damasqued silks, was a “dream-like trip between two millenary cultures that are linked by the Silk Road.”
Giornetti added that it was his intention to maintain the Chinese heritage but blend it with a contemporary look that would be appreciated by Western and Eastern customers alike.
Reporting by Giulia Segreti; Editing by Keith Weir