La Rinascente eyes expansion outside Italy

"I want to have seven to eight big stores in major European cities with very big tourist penetration in five years," chief executive officer Vittorio Radice said yesterday.

He has set a five-year plan to expand to other major tourist cities in Europe, such as Paris and London.

The company has two Italian flagship stores in Rome and Milan and a Danish flagship store in Copenhagen. It has eight small stores in other cities in Italy – Genoa, Turin, Florence, Palermo, Catania, Cagliari, Padova and Monza.

"We will concentrate our effort in big stores, like the Central Chidlom store here in Bangkok, for any future expansion," he said.

After taking over the chain in 2011, Central Group – Thailand’s largest retail conglomerate – set a goal to expand its retail business throughout Europe with dominant positions in cities popular with tourists. La Rinascente then gobbled up Denmark’s Illum outlets in 2013.

The goal was supported by Radice, an Italian who joined the chain in 2005. He accumulated extensive experience in the business as the manager of Habitat, part of Marks and Spencer, and Selfridges.

Under the expansion plan, annual sales were expected to surge from 600 million euros last year to more than 1.5 billion euros in five years.

La Rinascente has two business models for store expansion – acquiring existing properties in prime tourist cities and building from scratch by buying interesting buildings and transforming them.

For example, Milan has 60 million people. More than half of La Rinascente’s business in Milan comes from tourists.

"We have interpreted our store in Milan to represent Italian and Milanese lifestyles," he said.

In Copenhagen, Scandinavian products and lifestyles would be the first things shoppers see when they come to the store.

"We will invest about 50 million euros in store renovation, which started last year and will be completed in four to five years. By the end of this year, about 20 per cent of the renovation work will be finished," he said.

La Rinascente would also focus on sourcing innovative products for its stores, including from Thailand.

The world has been moving into more and more emotional needs and less of the products themselves when buying goods. Shoppers don’t need to buy anything. They want to buy things.

"At La Rinascente, we are talking to customers about their learning experience over time, not about price," he said.

La Rinascente will organise various collective ideas and activities related to sustainability of resources to serve the Expo Milano to be held from May 1-October 31, which is expected to attract more than 20 million visitors.

The theme is to promote sustainability of the food supply as well as energy saving forever.