The king of cashmere has found himself in the news most recently, this time for being one of the newly minted billionaires to come from the fashion industry. He joins the illustrious ranks of Georgio Armani and Ralph Lauren, as well as recent fashion billionaire Miuccia Prada. Last April, Brunello Cucinelli took his eponymous company public, while maintaining a controlling 63% interest. Since then, the company’s stock has doubled, catapulting Mr. Cucinelli’s wealth into the billions. Particularly inspiring are Mr. Cucinelli’s infamous business practices.
Plenty of fast-fashion retailers have achieved financial success by marginalizing employees and finding ways to dupe consumers into purchasing lower-quality products for higher prices (think: Zara). A number of luxury brands have struck it rich by using their luxury marquee on mall-grade products (aka: Ralph Lauren and Armani by way of Armani Exchange). However, the group of brands that offer actual hand-made luxury goods, produced humanely, is usually smaller and not nearly as lucrative.
Fortunately, Mr. Cucinelli’s recent success provides us with a counter-example of how to succeed in the fashion industry. Investing in “human capital,” as Mr. Cucinelli puts it, has allowed him to build an empire founded on treating both his employees and his customers with dignity. He even went so far as to buy a 14th Century Castle in Solomeo, Italy, where his company is located, and went about rehabilitating the town itself for the benefit of his employees. While most designers won’t be able to actually buy a city to lodge their workers, Mr. Cucinelli’s attitude towards his brand can be shared by anyone.