Alain Mikli International is going through an interesting phase of transformation under the management of Antonio Bortuzzo, the Italian executive who led a major strategic reorientation at Marcolin and then at Allison. He was appointed chief executive of the French company last autumn.
The challenge is to turn Alain Mikli into a larger company with an industrial dimension, while preserving the French spirit and the elements of design and craftsmanship that are associated with the name of its chief designer.
The goal was roughly the same when Dominique Alba, former president of Logo, was appointed CEO at Mikli in 2009, in connection with the entry of an institutional investor, Neo Capital, which still owns 47 percent of the shares. Mikli himself holds the same number of shares. Alba started the reorganization process by eliminating many jobs and rationalizing the cost structure, but he didn't quite reach the sales and profit objectives that had been set, partly perhaps because of the economic recession. Alba resigned last spring, but he still has a minority stake in the company.
Mikli's consolidated sales amounted to only €52 million in the past financial year, ended in August 2011, the same as before Neo Capital entered the picture. Sales went up by 16 percent in the first half of the current fiscal year, ended in February, and Bortuzzo has a goal of reaching a turnover of around €60 million in the current calendar year, while generating a reasonable profit before amortization.
In an exclusive interview during the recent Mido fair in Milan, Bortuzzo indicated that he expects to get many important benefits from the reorganization and expansion of Mikli's own retail activities, which are currently delivering an annual turnover of about €18 million.
Alain Mikli stores will operate more as service-oriented optical stores in the future, helping customers find not only the right type of frame for them, but also the right type of lenses. For this purpose, the company has launched its own high-end line of private label lenses in France, reportedly in partnership with Optiswiss. Called Mikli Les Yeux (Mikli the Eyes), the new service is intended to customize the lenses for the wearer's vision and requirements, while optimizing the combination of frames and lenses.
This program, which stands to generate 70 percent of the stores' revenues from lenses, will be gradually deployed all over Europe, and subsequently in the U.S. Working with Tokai, Mikli already developed this type of service for the last three years in Japan, where it is managing several stores and department store concessions.
Mikli's retail sales are growing at an annual rate of around 8 percent on a same-store basis, but according to Bortuzzo, they could achieve a growth rate of 20 percent with this new service, with the establishment of a customer loyalty program and with special agreements with local firms and hotels to generate traffic to the stores.
Mikli has slowed down a plan to offer Vuarnet sunglasses in its own stores, despite its takeover of the license and related assets at the end of 2009, waiting for the development of a more vintage collection that would better target the typical customers of its Alain Mikli stores.
Meanwhile, Mikli has developed a new, more commercial line of aviator-style sunglasses with a distinctive look and special decorative features. Called Mileage, it will become a permanent component of the Mikli eyewear collection, like its Starck Eyes collection.
Bortuzzo is also relaunching the Mikli par Mikli (Mikli by Mikli) collection. He has hired a new product manager, Nathalie Mis, with the purpose of creating a younger diffusion collection. It will be launched at the company's sales convention in June and presented to the market at Silmo.
Mikli currently has a network of 30 stores worldwide, five more than at the time of Neo Capital's takeover, when Alba announced a plan to raise their number to 80. Declining to specify a long-term objective for the future number of Mikli stores, as Alba had done before, Bortuzzo said he wanted to see as many new stores in place as allowed by the company's cash flow. For the moment, the biggest planned investment is a new and better location for its Milan store and a shop in the Reel shopping mall of Shanghai, which is due to open next September.
The company is also discussing joint ventures and retail partnerships in Dubai, Russia, Turkey and Mexico. Like other bigger eyewear companies that were previously covering the Chinese market from Hong Kong, Mikli set up a full-fledged subsidiary office in Shanghai last November to obtain a larger and more direct presence in this promising market. The brand already sells more than 22,000 pairs of glasses through about 120 stores in China, 40 of which have an Alain Mikli corner. Mikli claims to be the No. 1 designer brand in Japan and Hong Kong.
Excluding its own retail stores, Mikli's subsidiaries currently generate annual sales of about €8 million in Asia and €9 million in North America. Bortuzzo recently made a couple of important management changes in the latter area. He appointed a new U.S. sales director, Donna Hoffmann, and a new agent for Canada, Fernand Silva. They had both previously worked for him at Marcolin.
Several managing directors have come and gone at Mikli in the past few years, reportedly because of the very demanding and temperamental nature of the designer. However, Bortuzzo and Mikli told us during the same interview that they were in total agreement. Mikli spoke of a new energy within the company that should speed up the transformation process. While Bortuzzo is mainly an operational manager, Mikli indicated that he was also providing some useful input in the area of design.