Benetton halves the loss, relies on digital restart and rationalizes the sales network

The Benetton Group has more than halved its losses.

The Italian fashion group reported a minus of almost 100 million euros in 2024, an improvement by 57.5 percent compared to the previous year. In 2023, the loss of the group was still 235 million euros.

Five pillars of CEO’s plan: in Claudio Sforza

The plan launched by CEO Claudio Sforza to increase the efficiency and realignment of the Benetton Group’s business will continue. The plan is based on five pillars, the revival of the brand and strengthening the digital channels; the recovery of competitiveness by reducing the costs for the end product taking into account quality; the rationalization of the sales and trade network, process and organizational efficiency as well as the reduction of overhead costs.

Almost a year after the manager took office, the Benetton Group concludes the 2024 financial year with a trend reversal, which is supported both by the work of SFORZA’s team and the new course from Edizione.

All corporate functions were merged in a single location

As part of a comprehensive realignment, the company has bundled all corporate functions at a location in Castrette di Villorba. The goal is a more synergetic and efficient control of the organizational transformation process.

In addition, a broad program for increasing efficiency and redesigning the sales outlets and sales channels was started. In stationary retail, the directly managed shops in 2024 recorded average sales growth of seven percent compared to the previous year. At the same time, business relationships with partners were ended who were burdened with high defaults on payment compared to the Benetton Group.

The group also invests heavily in digital channels. An e-commerce expansion program was initiated that aims to increase the current online share of 13 percent in total sales to 20 to 25 percent in the coming years. In the course of this, a separate e-business department was set up, which reports directly to the Chief Executive Officer (CEO).

In parallel to the structural realignment, the Benetton Group has implemented measures to rationalize the workforce, which affect a significant part of the company’s employees. According to the company, the conversations with the unions were cooperative and aimed at keeping the social effects as low as possible.

In the area of ​​adapting the production processes to the market standards, the SFORZA plan has provided for a procurement strategy that can affect the costs, whereby the possibility is also being considered to contact specialized suppliers in order to overcome the production chain of the Benetton Group to the industry benchmarks and thus overcome the consolidated model in recent years Production of goods were awarded to third parties, while 40 percent were still produced by their own factories.

A situation that led to inefficient production in terms of both costs and the collections, whereby the development of the collections in relation to processing times was significantly reduced from twelve to six months. This acceleration had a double effect: on the one hand a financial, with a reduction in the bound circulation, and on the other hand a commercial one that enabled greater reactivity on market trends and a product range that is better tailored to the preferences of consumers.

In this context, the introduction of two new collections that have their roots in South Korea is one of the most important markets for the group, where it is represented with around 300 shops of their two brands, United Colors of Benetton and Sisley. On the one hand, Sisley K, a new premium line with an urban and refined style, debuts with a mono fire store in Rome and online and is aimed at a female audience with a demanding taste. On the other hand, BBOLD reinterprets the inheritance of United Colors of Benetton with the aesthetic codes of knitting, denim and strong colors, which merge with oversize volume and sporting details.