H&O Fashion Ltd. (TASE:HAO) has signed a contract that grants the company a franchise to market the Reserved international chain in Israel.
Considered a high-growth brand name, Reserved currently has 461 stores worldwide, and is owned by the LPP group, which has 1,700 stores worldwide. Reserve is regarded as a fashion brand comparable to Zara, with a similar design, but lower prices. The brand name will reach Israel in the first half of 2018. H&O will invest NIS 70 million in the operation.
H&O plans to open 30 stores of the brand in Israel, with the first three opening in mid-2018. Each store will have 1,500 square meters and separate departments for women, men, and children.
The sales of LPP, which has five different fashion brands, totaled NIS 6 billion in 2016. H&O will have a franchise for all five brands. The fashion industry often compares LPP to Inditex, owner of the Zara brand, because both groups have a number of different brands with different positioning. Reserve, LPP's leading brand, is presented by super-model Kate Moss.
LPP operates stores in 21 countries, including in cities such as London, Berlin, Moscow, Warsaw, Bucharest, Prague, Budapest, and Belgrade. The group has 25,000 employees, including 900 designers and collection-makers, and rents one million square meters of space in shopping malls worldwide. The group's logistics center is responsible for creating weekly up-to-date collections, and issues new collections every week all over the world.
H&O CEO Amir Moshe said, "One of the brand's advantages, beyond its cheap prices, is that it is considered to be the fastest growing brand in the world. The stores in Israel will update their merchandise every week. Prices in Israel will be the same as in Europe. The brand will offer easy prices, for example, women's trousers for NIS 80, men's tricot shirts for NIS 39, and women's dresses for NIS 89-99."
Under the agreement between the parties, H&O is scheduled to open stores in Israel for the other LPP brands three years after the Reserve stores are opened. The other brands involved are Cropp, a brand for teenagers; House, an urban fashion brand for young women and men; Mohiro, a tailored fashion brand for women; and Sinsay, a club culture fashion brand for young women.
Published by Globes [online], Israel Business News - www.globes-online.com - on October 15, 2017
© Copyright of Globes Publisher Itonut (1983) Ltd. 2017