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Alain Rabec takes over struggling business that includes Castorama and Brio Dépôt

Kingfisher, the UK home improvements group, said on Friday it will bring in Alain Rabec, a former executive at the hypermarkets unit of Carrefour, to head up its struggling French operations as the incoming group chief executive seeks to make his mark.

The appointment of Mr Rabec, who begins on Tuesday as chief executive of Kingfisher France, comes two days after Thierry Garnier took over the role of group chief executive from Véronique Laury.

The do-it-yourself retailer has struggled particularly in France, after the UK its biggest market, where last week it reported a 12.2 per cent fall in retail profit, in the six months to July 31. Like-for-like sales, which Kingfisher termed as “volatile”, fell 4.4 per cent to £2.2bn. Its French unit Castorama, which will be under Mr Rabec’s stewardship, was hit in the six month period by logistics and stock inefficiencies, the group said on September 18.

Mr Rabec will be responsible for 200 stores, 20,000 employees and £4bn of sales. In December he left Carrefour where he had spent many years in senior roles, most recently as executive director of Carrefour Hypermarkets, Kingfisher’s statement said on Friday. There he handled 230 stores and €17bn in sales.

Before that role, he had been in charge of reorganising Carrefour’s supermarket business, including a shake-up of its product offer and he introduced a loyalty scheme.

“He is one of the most experienced and respected retailers in France and will bring a wealth of deep operational experience to Kingfisher,” said Kingfisher chief executive Mr Garnier. “His knowledge of the French retail market is second to none.”

Mr Rabec’s LinkedIn entry states he had led Carrefour’s hypermarket unit since June 2016 and after his departure in December became a retail consultant based in Rennes.

“Castorama and Brico Dépôt are businesses with great potential and many growth opportunities ahead in an attractive market,” said Mr Rabec, who takes over from Christian Mazauric, who has taken time out to recover from an operation.

Fierce competition in France from privately owned Adeo, which owns brands such as Leroy Merlin, particularly hit Brio Dépôt in the first three months of the fiscal year but also hurt Castorama.

Shares in the FTSE 100-listed group rose 2.4 per cent on Friday in London.

Rome looks to seize on vigorous rally in bond market in recent weeks

Italy sold €7.5bn of new debt at record-low borrowing costs as the country’s new government capitalised on a powerful bond rally in recent weeks.

The sale of new five-year and 10-year bonds comes three weeks after the centre left Democratic party and the populist Five Star movement ended weeks of political uncertainty by agreeing to form a new coalition. Investors responded by piling into Italian debt, pushing yields to all-time lows.

Rome locked in those lower funding costs on Friday, selling five-year debt at a yield of 0.26 per cent and 10-year debt at 0.88 per cent. Both auctions attracted solid demand from investors, who are navigating markets where more than two-thirds of eurozone government bonds trade at negative yields. The majority of those yielding more than zero are Italian.

“In a world where interest rates are going to remain very low for a very long time, we would expect yields to fall further,” said Mark Dowding, chief investment officer at BlueBay Asset Management, which favours Italian debt in its portfolios.

Mr Dowding said the recent decline in yields — which has gained added impetus from the recent resumption of bond-buying stimulus by the European Central Bank — has created a virtuous circle for Italian debt. As yields fall, Rome’s massive debt pile of more than 130 per cent of GDP looks more sustainable, drawing in further buyers.

The new government replaced an unstable coalition between Five Star and the rightwing populist League party, which unnerved investors over the past 18 months with its anti-EU rhetoric. Markets were also uneasy about the prospect of new elections, which would have likely strengthened the position of League leader Matteo Salvini.

“The political changes have forced a lot of the bears to capitulate,” Mr Dowding said. “They were working on the assumption that Salvini would start another massive confrontation between Rome and Brussels and questions about Italy’s place in the single currency would re-emerge. That’s not how things have played out.”

The Swiss luxury-goods maker bought the Italian jewellery maison from Chinese investment company Gangtai Group for an undisclosed price.

GENEVA, Switzerland — Richemont is acquiring Italian jewellery brand Buccellati to bolster its existing portfolio of Cartier and Van Cleef & Arpels.

The Swiss luxury-goods maker bought the Milan-based brand from Gangtai Group Corp, a Chinese investment company, for an undisclosed price. Luca Solca, an analyst at Sanford C Bernstein, said it probably paid less than the €230 million ($250 million) the Shanghai-based investment company paid for Buccellati several years ago.

The new addition strengthens Richemont’s position in the branded-jewellery market. Jewellery has become more important for the company as it’s proven to be more resilient during economic downturns than watches. Richemont has been bolstering the unit, after Cartier introduced new lines such as Clash to attract more millennials to the brand.

“Buccellati is a brand with strong heritage and character, which can benefit from the expertise and scale of Richemont in jewellery,” Bernstein’s Solca said.

Buccellati, which celebrates its 100th anniversary this year, also makes watches and silverware, using techniques dating back to the Renaissance. Various bracelets in its collection are inspired by nobles in European history, such as the Caterina Bracelet, which features a honeycomb surface in gold and diamonds to replicate the yellow-white 16th-century silk gown in a portrait of Catherine de Medici’s wedding to King Henry II of France.

Corriere della Sera reported last year that the brand had sales of €50 million in 2017.

The acquisition will have no material impact on Richemont’s operating results in the current fiscal year, the Geneva-based company said in a statement Friday.

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Creative director Virgil Abloh’s hiatus comes at a turning point for his brand, which may need a degree of reinvention when he returns.

PARIS, France — A crowd of excited Virgil Abloh fans lingered outside the Centre Pompidou in Paris on Thursday night, waiting for something that would never materialise. The designer had promised that there would be some sort of crowd participation at the staging of his Off-White Spring/Summer 2020 womenswear collection. But inside, without the high-concept production that the industry has come to expect of Off-White’s shows, the runway only surprised by featuring minimal visible logos, focusing instead on sharp shirt dresses, cut-out leather pants and leggings with a front slit.

Abloh, as expected, was nowhere to be found. He announced at the beginning of September that he would work from home in Chicago for three months in order to recover from an overwhelming travel schedule, which included eight international flights per week as part of his work at Off-White and Louis Vuitton, where he is the men’s designer. (He also participates in myriad collaborations and is an in-demand DJ.)

For Off-White, Abloh’s temporary disappearance comes at a precarious time for the brand, which may be in need of reinvention when its founder does inevitably return.

In many ways, the retrospective on Abloh’s work in fashion and beyond on view at The Museum of Contemporary Art Chicago this summer felt like the end of a chapter for the designer, who has deftly recognised that fashion has become less about the intricacies of design and more about the significance of images and the way products build communities of like-minded people.

Many are wondering about the future of the brand, and what it might look like in the future with or without Abloh’s involvement. It was the topic of discussion last week in a closed Facebook discussion group called High Fashion Talk, as prompted by Iolo Lewis Edwards, a photographer and founder of the 25,000-member group of passionate fashion fans, many of whom are men.

“They can really benefit from that as a way to ‘refresh’ on their clothing which can be kind of redundant sometimes,” said one member. “Imagine a mass-produced Off-White hitting the middle markets instead, I reckon they could wipe the floor with high street brands,” said another.

Edwards said that he has seen a shift in recent months in the way that the group’s members regard Off-White, the sought-after luxury streetwear brand and collaboration machine founded by Abloh in 2014. Known for the sort of visual branding, tribal significance and tightly controlled distribution strategy that can turn a simple T-shirt into a coveted signifier of status and affiliation, Abloh pushed high-fashion to think differently about streetwear, limited-edition “drops” and community building. He has since been embraced by the mainstream, with LVMH naming Abloh men's artistic director of Louis Vuitton in 2018. More recently, Tom Ford appointing Abloh to the board of the CFDA.

But like all that goes up, Abloh’s ascent to the pinnacle of luxury menswear appears to be levelling off — and it’s not just fashion fans on Facebook groups. According to data from retail analytics firm Edited, demand for Off-White products at US retailers is slowing down. The number of sold-out products on Farfetch is down 50 percent year-over-year, and the number of discounted items is up 7 percent. During the sales in July, 40 percent of the brand's products were discounted, up from 30 percent the same period the prior year. For the year through August, the value of earned media about the brand on social media decreased 38 percent versus the same period a year earlier, according to Tribe Dynamics.

“It seems like the audience has moved over to Louis Vuitton rather than Off-White now,” said Edwards.

Off-White is at a turning point as the luxury streetwear cycle that Abloh helped pioneer starts to cool off. Last week, Balenciaga’s Creative Director Demna Gvasalia stepped down from Vetements, the only luxury streetwear brand to rival Off-White for its high-fashion influence, which has seen a more dramatic tumble in its relevance to both the industry and shoppers.

Abloh has already started to lay the groundwork for a new era at Off-White, pushing the collection in new directions on the runway in recent seasons, including more tailoring and evening wear. But the brand is still primarily known for its core offering of $300 T-shirts and $600 hoodie sweatshirts, as well as accessories and Nike collaboration sneakers, branded with his signature crossing arrows and quotation marks. These pieces are his major differentiators, much more so than the understated but elegant runway pieces which don’t have as clear a reason for existing in the market.

However, Off-White is hardily entering a tailspin. It is consistently at the top of Lyst’s quarterly list of hottest brands (based on Lyst and Google search data, conversion rates and sales and social media), alternating in the top spot with Gucci since the second quarter of 2018.

In the most recent quarter, Off-White’s Jitney bag — a ladylike style with “LOGO” and “CASH INSIDE” printed largely on the outside in Ablohs’ handwriting — topped the Lyst Index of most popular women’s items, and chunky Off-White Odsy 1000 sneakers ranked fifth in men’s products.

Currently, 16 percent of its US wholesale products are marked down, according to Edited, compared with an average of 37 percent for luxury brands.

And the community that Abloh has built around Off-White is still out there, waiting for the next Nike release or showing up to his show venues, motivated to belong as much as to buy. Its what inspires his fans to take in his work in a museum or cue up for his latest collaboration.

Luxury streetwear may have peaked among the jet-set youth, but there are still consumers discovering the brands that defined the trend. The larger societal movement of people dressing more casually, even at work and special events, should also keep the streetwear brands from fading fast.

Many luxury brands have also tapped into streetwear, making Off-White’s core market more competitive, said Mario Ortelli, managing partner of luxury advisory firm Ortelli & Co. But Off-White has a track record of giving customers what they don’t know they want yet, rather than reacting to the zeitgeist, he added.

“Off-White so far has shown great ability to adjust to what our market requests,” Ortelli said.

Meanwhile, however, big changes are coming to Off-White’s retail strategy, which will likely make the brand easier to shop and, as a result, cut into some of the hype it earns by being limited in release. This is particularly important for sneakers, which are seen as more desired based on how few pairs are available for sale. Last year, for example, releases of the coveted Yeezy sneaker did not instantly sell out because Adidas increased the quantities on the market.

The force behind the retail strategy change is Farfetch, which acquired the New Guards Group in August. The Milanese platform controls Off-White and other limited-release brands led by creatives with ardent followings, like Heron Preston and Palm Angels. Farfetch plans to launch, test and scale brands with New Guards through its own sales channels, effectively betting it can cash in on the rise of the next Off-White. The marketplace also plans to increase the volume of direct retail and e-commerce sales of existing brands, which only represents about 5 percent of New Guards Group revenue.

New Guards Group does not actually own Off-White, however, so it is unclear how much longer that relationship will last. New Guards is the majority owner of a company that licenses the Off-White trademarks, which are owned by Abloh. Once that agreement expires — neither side has said when — Abloh will be free to do what he wants with the Off-White brand.

What is clear, however, is that Abloh’s status as a leader in fashion isn’t going away anytime soon. He understands better than most that the business of fashion today is predicated on much more than innovative design.

Perhaps this self-enforced travel ban is a way for him to find his next approach.