Wednesday, October 29, 2008

Samsonite Aims to Add $100 Million to Sales With Footwear Unit

Oct. 29 (Bloomberg) -- Samsonite Corp., the luggage maker owned by CVC Capital Partners Ltd., plans to add about $100 million to revenue in the next five to six years through a new shoe-making unit, Chief Executive Officer Marcello Bottoli said.

``Our strategy aims at building up our brand with products related to traveling,'' Bottoli said yesterday in an interview in Milan, where Samsonite presented its shoes. The company is in talks with potential partners for eyewear and watches, he said.

Samsonite, the world's largest luggage maker, plans to open 180 stores, including franchises, this year and will add about 100 outlets in 2009 to keep sales growing as economies weaken, the CEO said. The global financial crisis is only just beginning and will take ``two to three years'' to pass, he said.

``We haven't seen anything yet,'' said Bottoli, who is based near London. Samsonite began cutting costs in July to become ``slimmer and more competitive during hard times,'' while maintaining investments on its brands and products, the CEO said.

Revenue will show ``modest growth'' next year, according to Bottoli, who forecast sales of about $1.3 billion in 2008.

``We're being conservative with our estimates given the general economic situation,'' he said.
The Mansfield, Massachusetts-based luggage maker may make acquisitions should opportunities arise, the CEO said, adding that Samsonite may spend as much as $400 million on takeovers.
The new footwear unit will be headed by Velimir Soskic, a former executive at Geox SpA, the Italian shoemaker that patented ventilated soles. The company already sells a limited collection of shoes, mainly in Italy.

Advertising Campaigns
Samsonite, which has about 1,000 stores, will also distribute the footwear through wholesaling, the CEO said. The collection will initially be available in Italy, Germany and other European countries such as Spain.

The introduction of footwear will be supported with advertising campaigns and marketing initiatives, Bottoli said. Actress Isabella Rossellini, French actor Jean Reno and Virgin Group Ltd. founder Richard Branson have appeared in Samsonite's commercials, according to the company's Web site.

Samsonite competes with luxury companies such as LVMH Moet Hennessy Louis Vuitton SA after adding the Black Label range three years ago to spur growth and create more allure for the brand. Black Label, which this week unveils the first collection designed by Viktor & Rolf, is going ``very well and has the highest growth rate among our brands,'' Bottoli said.