Hugo Boss

German company of men’s ready-to-wear. There are 8 plants operating in 6 countries with 2,000 employees. The company was established in 1923 in Metzingen, near Stuttgart, by the commercial agent Hugo Boss. Before the war the firm supplied clothing to the army and police. It later became the most significant German company of men’s clothing, thanks to the careful management of Uwe and Jocken Holy, the founder’s grandchildren. International success occured in the 1980s, with the appearance of yuppies and white collared males, for whom Boss is a status symbol. In the 1990s the company created two more brands: Baldessarini, the more refined, and Hugo, a line targeting a young and casual public. The company was acquired by the Italian group Marzotto in 1991.
Boss joined the womenswear sector, targeted to exploit new segments of the international market. The initial total investment amounted to 75 million German marks.
After consolidating the Boss brand in the Italian market, the group focused on the Baldessarini and Hugo brands. Hugo was strong in Germany, Northern Europe, and the UK. However its quota in the Italian turnover of Hugo Boss was marginal, as well as that of Baldessarini, the leading brand of the group. This line is characterized by a high tailoring content and is manufactured completely in Italy. It is distributed through ten multibrand boutiques.
The Collection Boss Woman, launched in late 2000, had a turnover of 48 million Euros, incurring a loss of 28 million Euros compared to the projected 14 million. The group admitted that the line was not to break-even in 2002. This was a big problem for Boss Woman.
The total turnover amounted to 1.095 billion Euros, up by 195 compared to 2000. The net profit amounted to 107 million Euros, a growth of 8% compared to the 99 million of the previous year, but below the growth expected by the company. The Boss brand recorded a 16% growth, Hugo 48%, and Baldessarini 52%.
Following the negative trend of Hugo Boss Woman, the mother company brought the style and development back to Metzingen to the group’s headquarters to regain direct control of the line. Cristina Salvador was replaced by Lothar Reiff as the designer of the woman’s Collection. Reiff is the creative director of all of Boss’ Collections.
The German group closed the year with a turnover of 1.093 billion Euros in line with 2001 results of 1.095 billion. The turnover only grew by 1.3% due to the exchange effect. Profits amounted to 74.7 million Euros, a clear decline if compared to 117.6 million of 2001.
The turnover of the first quarter closed with a decline in sales of 5%, arriving at 340 million Euros. Estimates concerning 2003 foresaw a stable situation compared to the previous year. Not taking into account the impact due to the strengthening of the Euro, the turnover remained unchanged compared to the same period of 2002. The net profit of the period diminished to 44 million Euros, from 53 of the first quarter of 2002 at comparable exchange rates.