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The Brunello Cucinelli Story: Combining Elegance and Ethics
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Brunello Cucinelli, a name synonymous with luxury Italian craftsmanship, established his eponymous company in 1978. Based in the quaint village of Solomeo, the brand is renowned for its high-quality cashmere and commitment to ethical manufacturing practices. What makes Brunello Cucinelli truly stand out is its soulful approach to business. Dubbed "humanistic capitalism," the company not only produces high-quality apparel but also invests in its people. Naming a few things: employees are paid 20% more than employees at comparable companies, working overtime is not allowed, and the whole company takes ninety-minute lunch breaks (including recommended post-lunch naps). Today, being one of the world's largest single-brand luxury companies, Brunello Cucinelli is celebrated for its exquisite garments and role in championing sustainable luxury and social responsibility. Let's take a closer look.
Key Insights
Ethical luxury: Brunello Cucinelli combines high-end craftsmanship with strong ethical principles, setting a standard in the luxury industry for responsible business practices.
Humanistic capitalism: Cucinelli's business philosophy, which he calls "humanistic capitalism," emphasizes the welfare of employees, including fair wages and good working conditions.
Cultural heritage: The company headquarters in Solomeo and its dedication to preserving this historical site underscore Cucinelli's commitment to cultural heritage, using it as a cornerstone for brand identity and community involvement.
Growth strategy: Despite its traditional approach to craftsmanship, Brunello Cucinelli continually innovates, recently expanding into new product lines like perfumes and maintaining healthy growth in global sales.
The Early Life of Brunello Cucinelli
Brunello Cucinelli was born on September 3, 1953, in Castel Rigone, a small hamlet near Perugia, Italy, into a family of modest means. His early life was marked by a rural-to-urban transition when his family moved to the city for better job opportunities, leaving the pastoral beauty of the countryside behind. This move exposed young Brunello to the harsh realities of industrial labor, as his father, a factory worker, often came home disheartened and humiliated by the treatment he received at work. These experiences deeply influenced Cucinelli, contributing to his lifelong commitment to human dignity and respect in the workplace.
Cucinelli’s education was not straightforward. He initially trained as a building surveyor and later enrolled in engineering at the University of Perugia but dropped out after three years, having completed only one exam. His interest in philosophy and the humanities, sparked by his time spent in local cafés discussing various topics with friends, eventually led him to fashion. At 25, inspired by the colorful wool sweaters of the Italian clothing group Benetton, he embarked on his entrepreneurial journey with a bold idea: to create a line of brightly colored cashmere sweaters. Despite financial constraints, he managed to launch his business by persuading a friend to lend him some cashmere, which he dyed and sold successfully in the north of Italy.
His philosophy of “Humanistic Capitalism” evolved from these formative experiences and his deep readings in philosophy, influencing not just his business practices but also his contributions to society, including significant restoration projects in Solomeo, the village he adopted as both his home and the headquarters of his company.
The Founding of Brunello Cucinelli
Brunello Cucinelli founded his namesake company in 1978, starting with a small collection of brightly colored cashmere sweaters. This venture was born from his desire to bring dignity and respect to the workplace, a stark contrast to the harsh conditions his father endured in factory work. With an initial investment of just €500, Cucinelli’s approach was innovative, introducing cashmere in a variety of colors which was not typical at the time.
The company was officially established in the picturesque hamlet of Solomeo, Italy, where Cucinelli purchased a 14th-century castle to serve as the headquarters. This location not only provided a beautiful backdrop but also symbolized the brand’s commitment to cultural and artistic heritage. Over the years, the brand has remained dedicated to its “Made in Italy” ethos, emphasizing a handcrafted quality that has become globally recognized.
Brunello in a 2015 interview, speaking about the company’s 8-to-6 rule, and other important cultural values:
“Then in our Company, we set these rules and these rules come from our Umbrian heritage, from Saint Francis and also Saint Benedict. I follow what Saint Benedict says.’You should try and be very straight and very sweet, a demanding master and a loving father.’ Now, the 720 employees in our Company, everybody start working at 8 o’clock in the morning and then we finish at 6 and no one is allowed to work after 6, because the human being needs to freshen up and if the human being have time to rest, then the morning after they will be curious and creative.
No, it’s not 24/7, because here in the company, you start at 8 AM, and at 5:30 PM you are forbidden to work any further. No emails can be sent to more than two addresses, just one or two. No group mailing. Why must a single email be read by 10 different people, unless it’s the 10 people who are interested in that specific issue? In order to disperse responsibility?
Here, we have no meetings with mobile phones. No one is allowed to bring them into the meeting room. You must look me in the eye. You must know things by heart. You must know all of your business with a 1 to 2 percent error rate. It is also training for your mind. It is also a question of respect, because I have never called someone on a Saturday or a Sunday. No one is allowed to do so. We must discover this, because if individuals rest properly, then it is better.”
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And there’s more than just the 8-to-6 rule, as stated by Brunello in a 2010 interview:
“The whole company takes a ninety-minute lunch break; employees can go home to feed their families or eat at the heavily subsidized company cafeteria – they pay less than three euros – and still have time for a nap afterward. (Given the quality of the cafeteria – where long tables are set with bottles of Pellegrino and wine, and local ladies serve minestre, pastas, platters of grilled meat, and salad – a nap is recommended.) Cucinelli has also installed a small library, near the theater, where workers and visitors are encouraged to browse volumes that look as if they had been selected by an eager undergraduate: there are works by Dante, Kafka, Proust, Ruskin, Rawls, Nietzsche, Derrida, Deleuze, in many different languages.”
In 2012, Cucinelli took the company public on the Milan Stock Exchange, not just for financial reasons but also to widen participation in his vision of business. The company’s growth continued with expansions such as the Solomeo School of Arts and Crafts, established in 2013, which aimed to preserve traditional craftsmanship and pass these skills on to future generations.
Here’s Brunello on the concept of luxury in his 2011 shareholder letter, the first one published in English:
“Whereas fashion is seasonal and changes every year, the luxury market is independent of time and is based on a solid tradition. The process whereby a brand becomes an authentic luxury brand is a long one and takes decades of experience, history and tradition. Luxury is not a concept we would define as being either accessible or democratic.”
The Company Brunello Cucinelli as of 2024
The Brunello Cuccinelli product range spans high-quality cashmere, ready-to-wear, and casual chic collections, embodying a refined, discreet, yet versatile everyday style. The brand has recently expanded its universe by introducing contemporary licenses in the eyewear and perfume categories, aiming to complement its looks and lifestyle. These new categories, launched in partnership with esteemed companies such as EssilorLuxottica for eyewear and Euroitalia for perfumes, symbolize “made well in Italy” and are distributed through the brand’s boutiques, high-profile opticians, and specialized stores.
Further reading: EssilorLuxottica: Global Dominance Through Strategic Acquisitions
Brunello on the Q1 2024 earnings call, touching on the company’s positioning in the eyewear and fragrances industries:
“Luxury must be something beautiful, well made exclusive, and rare for all product categories, so also for eyewear and fragrances, we do have the same positioning.”
As for the different distribution channels, there are two primary ones for Brunello Cucinelli: retail and wholesale. The retail channel, which accounted for 61% of total revenues in Q1 2024, saw a 15% year-on-year growth. According to management on the earnings call, this reflects a fair and healthy progress of the brand on a like-for-like basis across all geographies and markets, bolstered by new and exclusive store openings. The wholesale channel, contributing to the remaining 39% of total revenues, grew by 19% year-on-year. The Spring-Summer 2024 collections mainly drove this channel’s growth.
The sales are geographically spread across the Americas, Europe, and Asia. The Americas led in Q1 2024 with a 19.5% growth, followed by Europe (excluding Italy) with an 8.6% increase, Asia with a 16% growth, and lastly the home-market Italy with a 26.8% growth.
Brunello Cucinelli’s Geographical Split
All table data was fetched using the AI assistant in Quartr Pro, with full traceability and cited sources from the Brunello Cucinelli Q1 2024 earnings event.
Italy
27.6
35.0
+26.8%
Europe (excl. Italy)
67.9
73.8
+8.6%
Total Europe
95.5
108.8
+13.9%
Americas
95.5
114.2
+19.5%
Asia
74.3
86.1
+16.0%
The Impressive Growth Journey Since 2009
All this equates to Brunello Cucinelli’s trailing twelve-month (TTM) revenue of €1.14 billion, with an operating margin of 18.4%. And, despite the previously mentioned careful growth framework, the company has grown its revenue and EBIT by 621% and 1,608% respectively since 2009.
Brunello Cucinelli’s Ten Ideals for Life and Work
In 2021, Brunello was invited to speak at the G20 meeting thanks to his Humanistic Capitalism philosophy. There, he outlined his Ten Ideals for Life and Work:
Further reading: Brunello Cucinelli 10 Core Ideas
Wrapping Up
Brunello Cucinelli’s approach blends top-tier Italian craftsmanship with a deep respect for ethical practices. His brand showcases the impact of incorporating social responsibility into business, offering luxury while nurturing its workforce. As Cucinelli's brand evolves, it serves as a clear example of how integrating moral principles with business objectives can lead to sustainable success and influence in the luxury fashion industry.
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