Specialist
Former Director at Prada SpA
Agenda
- Prada's (HKG: 1913) top-line growth scenarios due to the coronavirus pandemic, including re-opening programmes, customer behaviour and pricing expectations
- Supply-side challenges due to outsourcing model
- OPEX reduction opportunities and CAPEX postponements
Questions
1.
How should we understand the demand-side implications of the coronavirus pandemic in Europe and the organic like-for-like growth rates across retail and wholesale for Prada throughout 2020?
2.
What online growth, if any, has been experienced in the European market in 2020?
3.
How does that 5% share of online in Europe compare to the online penetration for the brand globally?
4.
Why is Prada’s online penetration so much smaller than the market average or some of the additional monobrands in the market?
5.
Have you picked up on any differences in the third-party online progress in Q1 or during the coronavirus crisis at all?
6.
What is your expected online share post-coronavirus? Are you anticipating a higher level of penetration in relation to net sales post-coronavirus?
7.
Are you expecting an increased level of online penetration at a normalised level of growth once sales stabilise?
8.
Is the online channel margin eroding for Prada? Can we anticipate that the growth in the online share will have a negative impact on EBIT margin?
9.
How do online EBIT margins compare, roughly, if we take online vs in-store in a retail store?
10.
Are you picking up on any positive growth in China that could potentially indicate the shape of recovery in Europe?
11.
What is the share of international customers for Prada in Europe?
12.
Are there any differences in the European vs Chinese customer that could indicate that the European customer might be more sceptical about returning to stores compared to the Chinese customers which, as you say, have bounced back relatively quickly?
13.
What is it about the northern European customers that typically means that you expect them to rebound slower than the Chinese customer?
14.
What is the share of classical vs seasonal products within Prada globally and are there any differences in Europe?
15.
Which channels do you think Prada will sell through? I know there has been a push away from discounting in the core retail channel. How are you expecting Prada to move through this inventory?
16.
What is the global outlet sales penetration for Prada?
17.
How are you expecting pricing in the wholesale channel to be affected?
18.
Do you think Prada would take back any stock to avoid aggressive discounting in the wholesale channel?
19.
Are you expecting a reduction in the number of wholesale doors, at least in Europe? What do you think is a realistic reduction?
20.
What do you think is the optimum wholesale-retail channel split for Prada?
21.
Given the onshoring of Chinese spend, are you expecting some form of global price alignment?
22.
What are your thoughts on the distribution strategy for the retail channel, given the current closures? What are you anticipating from a reopenings perspective, given social distancing considerations for Prada specifically?
23.
How do you think Prada’s stores can stay viable to the local customer if we are anticipating a reduction in international spend?
24.
Are you expecting any openings for the D2C channel over the next 12-18 months?
25.
Is Prada in a worse position than brands such as Louis Vuitton or Gucci due to the share of in-house vs outsourced production?
26.
Are you concerned around supply shortages in the medium term due to ateliers closing down or prioritising larger brands such as Louis Vuitton or Gucci?
27.
Are you expecting order cuts for the wholesale and department store channel for autumn/winter to match demand?
28.
What level of order cuts are you expecting and are there any agreements in place which limit the amount of stock that can be cut?
29.
What is the cost of rent as a percentage of net sales for Prada?
30.
Is Prada more challenged as a monobrand compared to the larger conglomerates? Are there less OPEX- reduction opportunities?
31.
Do you think that, in today’s climate, Prada could potentially be an acquisition target?
32.
Who do you think would be interested in acquiring the business?
