Prior to their EXIM investment, Hungarian fashion brand, Nanushka was close to follow other smaller fashion brands from Hungary and shut down – but they rather started everything from zero, successfully.
Head designer and owner of the brand, Szandra Sándor and co-owner Péter Baldaszti talked about their new business model, transformation of Nanushka, lessons and difficulties in the 12 years of the brand’s existence and the future plans to hvg.hu.
They were a couple of weeks out of the decision to close, just like another Hungarian brand, USE Unused, who shut down their clothing brand after 13 years, when they have received an HUF 300M (EUR 967 thousand) injection from EXIM Növekedési Magántőkealap, a private equity fund.
After the investment, they needed a rapid transformation to survive and they started a completely new strategy with the new partner. Nanushka continued with a new business model, including the transformation of their wholesale partner network – they set up a new global sales-team and took over the work from the former distributor.This means more administrative work, but this way, they also receive more information about their customers.
After a full re-branding, Nanushka’s webshop was renewed this March and their traffic grew tenfold. Szandra Sándor said, the good quality of their product is just a very small part of success, as the market is extremely competitive. Every day, new, world-wide competitors are coming up to dominant positions and they have to tackle them.
Baldaszti said, they could not get to this point five, or ten years ago. Today, the focus of their marketing is social media, which is a cheap way to advertise the brand and Nanushka builds its social media presence on Instagram.
Although it is hard to compete with bigger, international brands for the tailors, modelers or sewers, 75 to 80 percent of Nanushka products are made at home. Szandra said: “Nanushka is a Hungarian brand. In the worst case, we still want to keep 60-65 per cent of the production at home, for control purposes. We are a contemporary luxury fashion brand, the production may be more expensive, but we need quality products. We work with smaller workshops with 10-15 sewers.”
For a long time, Nanushka has been struggling to produce the minimum orders – now they have to maximise the orders. In November, they had a place at the Galeries Lafayette in Paris, where the brand outperformed the expectations of the department store, as they sold out the whole stock in just one week. They are now discussing another cooperation, but Szandra’s dream is to get into Le Bon Marché in Paris, the first and still one of the most prestigious department stores of the world.
The brand has been existing since 2005, but as they are thinking back, they had many mistakes. Szandra Sándor designer said, her biggest mistake was to rely on external advices too much.
They have many great plans for the coming months, they are now managing the production of the next half-year – as a new brand can appear anytime, they have to be prepared for everything.
Nanushka will strengthen the online presence, many improvements are planned for the webshop and they are preparing a new line of accessories. In January, they will held a big press conference in London and in February, their new shop will open in Bécsi út. Later, they will take part in New York Fashion Week and in April, they are opening a pop-up store in Los Angeles.
Szandra and Péter are hoping that within two years, Nanushka can get closer to being a self-sustaining, international fashion company and attract investors. This year, their revenue is expected to be around 760 million forints, nearly 2.5 times the last year – 90 per cent of it comes from foreign sales, with their biggest market in the US.
featured photo: monocle.com