Prada Corporate LogoPrada, SpA is an Italian fashion company
(also known as a "label" or
"house") with retail outlets worldwide.
The company was started in 1913 by Mario Prada
and his brother Martino as a leather goods shop - Fratelli Prada
(English: Prada Brothers) - in Milan, Italy. Initially, the
shop sold leather goods and imported English steamer trunks and handbags.
Mario Prada did not believe that women should have a role in business,
and so he prevented female family members from entering into his company.
Ironically, Mario's son harbored no interest in the business, so it was
his daughter Luisa Prada who took the helm of Prada as his successor,
and ran it for almost twenty years. Her own daughter, Miuccia Prada,
joined the company in 1970, eventually taking over for her mother in 1978.
Miuccia began making waterproof backpacks out of Pocone.
She met Patrizio Bertelli in 1977, an Italian who had begun
his own leather goods business at the age of 17, and he
joined the company soon after. He advised Miuccia-and she followed the
advice-on better decisions for the Prada company. It was his advice
to discontinue importing English goods and to change the existing luggage.
Miuccia inherited the company in 1978 by which time sales were up to U.S.
$450,000. With Bertelli alongside her as business manager, Miuccia was allowed
time to implement her creativity in the company's designs. She would go on to
incorporate her ideas into the house of Prada that would change it.
She released her first set of backpacks and totes in 1979. They were made out of a
tough military spec black nylon that her grandfather had used as coverings
for steamer trunks. Initial success was not instant, as they were hard to
sell due to the lack of advertising and high-prices, but the lines would go
on to become her first commercial hit.
Next, Miuccia and Bertelli sought out wholesale accounts for the bags in
upscale department stores and boutiques worldwide. In 1983, Prada opened
a second boutique in the centre of the Galleria Vittorio Emanuele in
Milan's shopping heart, on the site of the previous historic "London House"
emporium run by Felice Bellini from 1870 to the 1960s, reminiscent to the original
shop, but with a sleek and modern contrast to it.
The next big release was a nylon tote. That same year, the house of Prada
began expansion across continental Europe by opening locations in prominent
shopping districts within Florence, Paris, Madrid, and New York City. A shoe
line was also released in 1984. In 1985, Miuccia released the "classic Prada handbag"
that became an overnight sensation. Although practical and sturdy, its sleek lines
and craftsmanship exuded an offhand aura of luxury that has become the Prada signature.
In 1987, Miuccia and Bertelli married. Prada launched its women's ready-to-wear collection
in 1989, and the designs came to be known for their dropped waistlines and narrow belts.
Prada's popularity skyrocketed when the fashion world took notice of its clean lines,
opulent fabrics, and basic colors.
Prada's originality made it one of the most influential fashion houses, and the brand became a premium status symbol in the 1990s.
Sales were reported at L 70 billion, or US$31.7 million, in 1998.
Partrizio di Marco took charge of the growing business in the United States
after working for the house in Asia. He was successful in having the Prada bags
prominently displayed in department stores, so that they could become a hit with
fashion editors. Prada's continued success was attributed to its "working-class"
theme which, Ginia Bellafante at The New York Times Magazine proclaimed, "was becoming
chic in the high-tech, IPO-driven early 1990s." Furthermore, now husband and wife, Miuccia
and Bertelli led the Prada label on a cautious expansion, making products hard to come by.
In 1992, the high fashion brand Miu Miu, named after Miuccia's nickname,
launched. Miu Miu catered to younger consumers, such as celebrities. By 1993
Prada was awarded the Council of Fashion Designers of America award for accessories.
Men's ready-to-wear collections were launched in the mid-1990s.
By 1994, sales were at US$210 million, with clothing sales accounting for
20% (expected to double in 1995). Prada won another award from the CFDA,
in 1995 as a "designer of the year" 1996 witnessed the opening of the 18,000 ft2
Prada boutique in Manhattan, New York, the largest in the chain at the time. By now
the House of Prada operated in 40 locations worldwide, 20 of which were in Japan. The
company owned eight factories and subcontracted work from 84 other manufacturers in Italy.
Miuccia's Prada and Bertelli company were merged to create Prapar B.V. in 1996. The name,
however, was later changed to Prada B.V., and Patrizio Bertelli was named Chief Executive
Officer of the Prada luxury company.
In 1997, Prada posted revenue of US$674 million. Another store in Milan opened
that same year. According to the Wall Street Journal, Bertelli smashed the windows
of the store a day before the opening, after he had become deeply unsatisfied
with the set-up. Prada also acquired shares in the Gucci group, and later blamed
Gucci for "aping his wife's designs." In June 1998, Bertelli gained 9.5% interests
at US$260 million. Analysts began to speculate that he was attempting a take over
of the Gucci group. The proposition seemed unlikely, however, because Prada was at
the time still a small company and was in debt. Funding Universe states that "At
the very least, Prada had a voice as one of Gucci's largest shareholders (a 10
percent holding would be required for the right to request a seat on the board)
and would stand to profit tidily should anyone try to take over Gucci." However,
Bertelli sold his shares to Moet-Hennessy - Louis Vuitton chairman Bernard Arnault
in January 1998 for a profit of US$140 million. Arnault was in fact attempting a
take over of Gucci. LVMH had been purchasing fashion companies for a while and
already owned Dior, Givenchy, and other luxury brands. Gucci, however, managed
to fend him off by selling a 45% stake to industrialist François Pinault, for
US$3 billion. In 1998, the first Prada menswear boutique opened in Los Angeles.
The company's merger and purchasing sprees slowed in the
2000s. However, the company signed a loose agreement with
Azzedine Alaia. Skin care products in unit doses were introduced
in the United States, Japan and Europe in 2000. A 30-day supply of
cleansing lotion was marketed at the retail price of US$100.
To help pay off debts of over US$850 million, the company planned
on listing 30% of the company on the Milan Stock Exchange in June
2001. However, the offering slowed down after a decline in spending
on luxury goods in the United States and Japan. In 2001, under
the pressure of his bankers, Bertelli sold all of Prada's 25.5%
share in Fendi to LVMH. The sale raised only US$295 million.
By 2006, the Helmut Lang, Amy Fairclough, Ghee, and Jil Sander
labels were sold. Jil Sander was sold to the private equity firm
Change Capital Partners, which was headed by Luc Vandevelde, the
chairman of Carrefour, while the Helmut Lang label is now owned by
Japanese fashion company Link Theory. Prada is still recovering
from the Fendi debt. More recently, a 45% stake of the Church &
Company brand has been sold to Equinox.
On May 6, 2011, Hong Kong Stock Exchange was accused on approving Prada's
IPO during Prada Gender Discrimination Case which Prada was ultimately to win.
Female NGOs and the member of Hong Kong Legislative Council and Law Maker,
Lee Cheuk-yan protested in front of Hong Kong Stock Exchange.
In 2005 an installation was made miles away from the nearest city
in Texas. The name of the art piece is titled "Prada Marfa," and
it resembles a Prada boutique. The purpose of this was for the shop
to disintegrate into its surroundings.
The brand was listed on the Hong Kong Stock Exchange to raise $2.14 billion, but failed to meet expectations reported by AAP on June 17, 2011 and Bloomberg.
In 2015, Prada's turnover was 3,551.7 million euros, up 1 percent from 2014, while its gross operating profit fell 16.5 percent to 954.2 million euros.
In July 2016, Prada clothing became available to purchase online for the first time through Net-a-Porter and MyTheresa.