Brioni

Brioni

Saturday, February 01, 2014 12:18 PM

1. How should Umberto react to the email from Joe Barrato? Umberto Angeloni should clarify the situation with Joe Barrato whether the CEO of Neiman Marcus or the buyer is upset with the new women's line. If the CEO is upset with the decision, then Brioni should offer some incentive to carry the new line. 2. How big a gamble is the ladies venture for Brioni? It is as big of a gamble as the amount of money that already has been invested into the women's line. Initial investment: € 13M 3. Who do you think should be the target market for the women's line and by what means will those women gravitate to buying Brioni? One target mentioned in the study indicated those that accompany men who wear Brioni suits. The other target would be independent women who believe they should also project their presence with a suit. Aside from the fashion show that Brioni hosted, word of mouth is the primary means for advertising. 4. What sales do they need to achieve to declare the new line a success? Is that level of sales possible? The Pro Forma Projections for Ladies (Exhibit 10) states the 'break-even' Net Sales for each division of the company, which are as follows: Factory: €5229000 Milan: €2424000 €5229000+€2424000+$2411000=€10,064,000.00 New York: $2411000 Investment on stores= $7670000 + $3200000 + $713000 + $1215000 = $12798000.00 Employees = 47

Total Investment(2years) = Investment on stores + Employees

Revenue(2 years) = 36000 * 2500=$90000000 Profit(2 year) = $90000000 - ($12798000.00+Employees) = $77,000,000(approx) Profit(1 year) = $38,500,000 5. Is the women's line a good idea for Brioni? The idea of entering a different market provides many new opportunities if handled well. However, if the differences between selling men's and women's apparel are not overcome, the company will suffer severely. 6. Regardless of your answer to the previous question, do you approve of Umberto's

Discussion Page 1

6. Regardless of your...