Jan
 28
 2019



Caroline

Hello,

Welcome back to The Spin. This week, European companies are at the center of attention. Italy wants more than €1 billion in unpaid taxes from Kering. British retailers are piling up inventory in case England exits Europe without a deal. And all eyes are on LVMH's full year results. On a lighter note, Catherine Deneuve just auctioned her Saint Laurent's Smoking and it got a hefty price. Enjoy the read. Best, Caroline.



markets

Lost in translation. French Kering, the owner of Gucci and Yves Saint Laurent, is facing (paywall) an Italian claim for €1.4 billion in unpaid taxes. Auditors say that Kering's subsidiary, Switzerland-based Luxury Goods International, was billing business which were in fact carried out by employees in Milan and Paris. The reason for LGI involvement? Lower tax rates in Switzerland. Kering contests the Italian finding and claims that it employs 600 people at its logistics center in Switzerland.


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Piling up. Major UK retailers increased their inventory to the highest level since the 2008 financial crisis, in case England exits Europe without a deal at the end of the March deadline. Brits are stockpiling food, medicine and even non-perishable goods. For example, MI Supplies, an online work clothing seller that sources garments from Europe, has increased its stocks 60% to be able to satisfy its customers quickly, whatever happens on the Brexit front.


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Chinese big question. As one of the first major luxury players, LVMH will report its 2018 full year results on Wednesday - and it is expected (paywall) to be a blueprint for the whole industry and an indicator of the impact of the slowdown of the Chinese economy. Edouard Aubin, head of luxury research at Morgan Stanley, recently wrote a report on LVMH's Louis Vuitton, the cash machine that accounts for 47% of the group's profits, and wonders if the brand became too ubiquitous to keep its desirability.





brands

Nike to the rescue. Nike and Fanatics will be the next jersey suppliers for Major League Baseball. The 10-year agreement starting in 2020 was originally signed by Under Armour (UA) and Fanatics, but last year UA backed out to cut costs. Nike, which also designs the players' uniforms on the field, jumps in to expand its baseball business. Meanwhile, the Fanatics' plant in Palmer Township (Pennsylvania) stays in charge of manufacture and distribution of all MLB products to consumers.



United Colors show. The Italian Benetton Group will hold (paywall) its first show with designer Jean-Charles de Castelbajac on February 19, kicking off Milan Fashion Week. Jean-Charles de Castelbajac joined the company last October after returning Luciano Benetton asked him to come. The boss, coming out of retirement to battle dwindling sales, said at that time that Benetton and de Castelbajac both share a love of strong colors and irreverent touch.



Grab Le Smoking. The auction result of Catherine Deneuve's Yves Saint Laurent couture collection surpassed all expectations, fetching more than $1 million. The famous Smoking alone, a custom tuxedo pant suit made by Saint Laurent in 1982, sold for €20,000. Catherine Deneuve reluctantly auctioned her Saint Laurent souvenirs, following the sale of her Normandy house, where the garments had been stored. There's even more to come: 146 items are available in an online auction until 30 January.





people

From Saks to Peerless. Canadian manufacturer Peerless clothing is bringing (paywall) in Eric Jennings as vice president of creative direction. The former men's fashion director of Saks Fifth Avenue will head up Tallia and Tailored, two brands owned by Peerless. He will also supervise the licenses for brands like Lauren Ralph Lauren, Calvin Klein, Michael Kors and Tommy Hilfiger. Eric Jennings has more than 20 years of experience in luxury fashion. He worked at Armani, Hugo Boss and Hickey Freeman before Saks Fifth Avenue.





tech

Peer to peer rental. New Yorkers don't need to buy nice clothes for a night out, they can just rent it on the Wardrobe platform. This new app, created by Adarsh Alphons is the Airbnb for clothes. Women who don't use their wardrobe on a regular basis can bring it to a dry cleaner like Next Cleaners or J Cleaners, which operate as a storefront for Wardrobe. Renters will pick up their selection for a week and bring it right back there. The average fee is about $45.







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