The document discusses Brunello Cucinelli, an Italian fashion company founded in 1978. It provides background on Cucinelli, who was born into a poor farming family and drew inspiration from his father's factory work. He founded the company with no employees or money. Today, Cucinelli S.p.A. has annual revenues over €500 million, 1,400 employees, and is known for its focus on ethics, community, and high salaries. However, the company's future sustainability depends heavily on Cucinelli himself as leader, with risks if he departs and weak corporate governance.

1. Pierfrancesco Bresolini 4257378
Sebastian Kummle 4262679
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The humanistic approach of Brunello Cucinelli:
story and analysis of an Italian fashion company

5. Brunello Cucinelli (person)
• Born in 1953 in a family of farmers (poor but happy)
• When he was 15 they moved from the countryside to the city
• His father worked in a factory and was humiliated
• Brunello was getting bullied at school
• Wanted to do something for the wellbeing of humankind
• In 1975 left the university before finishing it
• Founded company in 1978, with neither employees nor money
• In the same year he sold the first 53 sweaters
(Nalley, 2013)

6. Our story starts from ...
Cucinelli:
practical
examples
Future Summary

7. Brunello Cucinelli (company)
• In 1978 he founded Brunello Cucinelli S.p.A.
• Sales of menswear & womenswear, home accessories
• HQ in 14th-century castle in Solomeo (Umbria/Italy)
• Really good facilities for employees
• Known for paying very high salaries
• Market capitalization of € 1.3 billion in 2016
• Currently 1,400 employees and 3,000 local contractors
• He is CEO and Chairman of the company
(Cucinelli, 2010; Proietti, 2015; Borsa Italiana, n.d.)

8. Brunello Cucinelli (company)

9. Brunello Cucinelli (company)
(Cucinelli, 2016)

10. Cucinelli’s revenues per geographical area
(Cucinelli, 2016)

11. "Those who work with us take part in the company’s
life. Everybody knows that their work is an
indispensable contribution to our shared growth"
- Brunello Cucinelli

12. Brunello Cucinelli (foundation)
• Donates 20% of his income to his foundation
• Important for relation with communities and stakeholders
• Important restoration projects for local communities
• Sponsored events for employees and their families
• School of Craftsmanship
(Gelardini, 2014)

14. Environmental analysis:
sector and competitors
Price
Quality / Perception
(Corbellini and Marafioti, 2013)

15. Resource-Based View (RBV)
(Penrose, 1959; Wernerfelt, 1984)

16. Beauty will save the world
Fedor Dostoevskij

17. SWOT Analysis
(Humphrey, 1960)

18. Porter’s Five Forces
Low risk:
- Many different commodities
and suppliers
- Also machines for clothings
enough available on the
market
Low risk:
- New entrants need:
experience, strong brand, name,
reputation, retailers, network
- Also many competitors
→ Red Ocean
High risk:
- Customers have no switching
costs and free choice of many
companies
- Target customer are rich people,
so only limited amount of potential
customers
- Company always needs to follow
the style and the trend → if style is
‘out’ company has a long way to
catch up
Low risk:
- Cheaper cloths no real substitute
for luxury
- Could be handmade cloths
Big competition & rivalry
inside luxury segment → Red Ocean
(Porter, 1979)

19. Sixth force Other
stakeholders
Customers
SubstitutesNew Entrants
Suppliers
Competitors /
Rivalry

20. Sixth force

21. Cost or Differentiation strategy?
What do you think?
MEN
Suit
£ 2360
Shirt
£ 330
Leather
outerwear
£ 3390
Trousers
£ 470
Sweater
£ 860
Document
holder
£ 1050
(Cucinelli, n. d.)

22. WOMEN
Bag
£ 1990
Dress
£ 3070
Sandals
£ 990
Crewneck
jumper
£ 1580
Leather
outerwear
£ 3310
Trousers
£ 950
(Cucinelli, n.d.)
Cost or Differentiation strategy?
What do you think?

23. (Porter, 2008: 39)
Porter’s Generic Strategies

25. Cucinelli where you did not expect...

26. Cucinelli where you did not expect...

27. Cucinelli where you did not expect...

29. Qui-Gon: "Don't center on your anxieties, Obi-
Wan. Keep your concentration here and now,
where it belongs."
Obi-Wan: "But Master Yoda said I should be
mindful of the future."
Qui-Gon: "But not at the expense of the
moment. Be mindful of the living Force, young
Padawan."
Star wars ep. 1 - “The Phantom Menace”
About the future …

30. Stay focused in the moment !
However ...

31. Our opinion about the future
Huge
competition
(red ocean) -
no time for
uncertainties
Doing well here
and now, but the
future is
uncertain
weak corporate
governance
Risk: company born and dies with him
Conclusion: at the moment no sustainability for the future
Overall “temporary” sustainable business:
Centrality of
Cucinelli (person)
cause
interrelation

32. Solutions:
• Improve corporate governance situation
• Try to detach himself from the company, try to split cucinelli person from
cucinelli company → new CEO, new executives?
• Talent attraction → new offices for talents/university graduates in important
cities
• He is trying to direct the future of the company towards the stock market, he
sees the stock market as future guardian ...
Will it be enough?
Our opinion about the future

33. Some examples ...

35. Summary - Key points
Shared values
Stakeholders relation
Employees relation
Leadership
Economic return
Good business
here and now !
HOWEVER:
Cucinelli dependency
Future sustainability ???

36. References
Borsa Italiana, (n. d.). Brunello Cucinelli. [online] available from <http://www.borsaitaliana.it/borsa/azioni/dati-
completi.html?isin=IT0004764699&lang=it> [5 April 2016].
Corbellini, E., and Marafioti, E. (2013). La CSR nella moda: strumento di marketing o elemento fondante della strategia di
impresa? [CSR in fashion business: a marketing tool or real heart of the company?]. Economia & management: la rivista
della SDA Bocconi, (3), 61-80.
Cucinelli, B. (n. d.). Spring Summer Collection 2016. [online] available from
<http://boutique.brunellocucinelli.com/gb/men/fashionshow> [5 April 2016].
Cucinelli, B. (2010). “Dignity as a Form of the Spirit”, lectio magistralis at The University of Perugia, 11th November.
Cucinelli, B. (2016). Annual Report 2015. [online] available from ˂http://investor.brunellocucinelli.com/yep-
content/media/07_CUCINELLI_INGLESE_11042016.pdf˃ [2 April 2016].
Gelardini, M. (2014). ‘Brunello Cucinelli, re del cashmere e mecenate del nuovo millennio’ [Brunello Cucinelli, king of
cashmere and mecenate of the new millennium]. La Repubblica, March 2014. [online] available from
˂http://www.repubblica.it/next/eccellenze-in-digitale/2014/03/07/news/brunello_cucinelli-79864672/˃ [2 April 2016].

37. Humphrey, A., Dosher, M., Benepe, O., Stewart, R., & Lie, B. (1960). The SWOT analysis method. Mento Park, CA,
Stanford Research Institute.
Nalley, R. (2013). ‘Life by design’. Forbes Life, 28th March, 78-84. [online] available from
˂http://www.forbes.com/sites/richardnalley/2013/03/28/brunello-cucinelli-life-by-design/˃ [1 April 2016].
Penrose, E. T. (1959). The Theory of the Growth of the Firm. New York: John Wiley.
Porter, M. E. (1979). How competitive forces shape strategy. Harvard Business Review.
Porter, M. E. (2008). Competitive strategy: Techniques for analyzing industries and competitors. New York: Simon and
Schuster. (First Free Press Edition 1980).
Proietti, M. (2015). ‘Cucinelli, le figlie e il cashmere “non si butta mai, si tramanda”’ [Cucinelli, daughters and cashmere “do
not never throw away, hand down”]. Corriere della Sera 28th November, p.33.
Wernerfelt, B. (1984). A resource‐based view of the firm. Strategic management journal, 5(2), 171-180.
References