After its strong penetration of the Russian market, the Italian company is targeting China as its priority for territorial expansion. It is attacking this challenging market sideways, building up Fabi's image as an all-around brand of accessible luxury covering products other than footwear, such as jewelry and clothing.
Nello Membro, a former executive of Nine West and Guess? who has been Fabi's commercial manager for the last six years, recently indicated that the Italian brand will introduce its footwear gradually in China only later this year, starting with a network of about 20 stores. The shoes will be made in Italy to add further clout to the brand.
Before this move, Fabi struck a licensing agreement with a Chinese partner for a network of Fabi branded jewelry stores, starting at the beginning of 2010. There are 17 such stores now in operation in China, and their number is set to increase to 70 by 2015.
Fabi already has its own line of silver jewelry, which is sold in its own stores in Italy and elsewhere, but because of import restrictions, the jewelry sold in China is manufactured locally. The beauty of the agreement is that it has allowed the Fabi brand name to become known in an interesting segment of the overall fashion market with zero costs for the Italian firm, whose minor investments in China have been covered by the royalties from the license.
Another step in Fabi's conquest of the Chinese mainland was a partnership signed last June with Erdos, a big local manufacturer of cashmere clothing. The company has agreed to set up a network of Fabi men's wear stores, offering a range of products priced below those of Zegna, which has a big presence in the country. The garments will use Italian fabrics, but they will be made in China.
Including licensees' sales, Fabi's total revenues amounted to €46 million in 2011, up from €41 million in the previous year. In the Russian market, its turnover grew by 18 percent to €20 million, but the company grew also on the Italian market, up to €14 million from €12.1 million in 2010. Fabi is projecting total revenues of €50 million for the current financial year.
Fabi already has 45 single-brand stores around the world, excluding the nine Fabi jewelry stores in China. Four new stores were opened in Russia in 2011.