A stitch in time

Brunello Cucinelli’s cashmere brand is built on history, philosophy and an exclusive market for luxury clothing

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In a light-filled room in a restored castle on an Umbrian hilltop, three women are discussing how to sew a cashmere overshirt made of a single finely knitted cord. The women have the strong, nimble fingers and short nails of the lifelong seamstress.

Crafting luxury clothing fit for a king in Italy’s Cashmere Valley

One guides the other two, showing them how she sews the cord into the right shape, fixing it with quick, sure stitches. The word bello (beautiful) peppers their conversation.

One of the women goes to a rack in an adjoining room where samples for the new collection are being painstakingly prepared and retrieves a version of a finished garment in the same line. The garment is beautifully made, the material is of the finest quality, the stitching is flawless, the care that has gone into its making is evident.

This is the essence of Made in Italy. The location really is a castle, part of the medieval hilltop village of Solomeo, in the heart of the central Italian region of Umbria.

The castle is both a workshop, where samples for upcoming collections are prepared and elaborated, and the heart of the luxury clothing enterprise of Brunello Cucinelli. One of Italy's most unique industrial figures, he has just been crowned 'Man of the Year' at the Grand Prix of Advertising.

Investing in timeless beauty and value

Solomeo is his great work and he has invested millions in the restoration of the ancient village. This achieved two things of great importance to Cucinelli: working in a beautiful setting and restoring something old.

Another reason is more prosaic, but equally revealing: in Italy, a bank can find restored buildings as a warranty on a loan preferable to lending money on an industrial area. For Cucinelli, good business sense and the beautiful often go hand in hand.

Indeed, Cucinelli is not an archetypal entrepreneur. A self-made and successful fashion leader, he has an unorthodox approach to industrial manufacturing.

In 2012, he made headlines when he split US$6.5m of the company's net profits with his employees. At nearly 60, he speaks in a quiet but firm voice of his philosophy of "humanist capitalism".

"I will never make money from the misery of others, and I will never humiliate those who work. We must be contemporary, but we must insist on profits that are sustainable, that are right in all senses," he says with a smile that is at once both self-effacing and absolutely sure.

A lifelong affinity for beautiful things

Cucinelli, who describes himself as a global artisan, was born into a humble farming family not far from Solomeo, his wife's hometown. He recounts an idyllic childhood in the country that ended when his father moved the family to Perugia for a job in a cement factory.

The move wasn't successful, and he recalls his father's anguish at the anonymity of the factory worker's life, the sense of frustration and alienation in the city after their peaceful country life.

The experience left its mark on Cucinelli. "I decided that I would work toward improving human dignity, and this has been my lifelong objective," he says.

In his early 20s, many of his ideas about philosophy and business developed amid discussions about politics and religion during card games played late into the night. Meanwhile, his childhood sweetheart and wife Federica had opened a small boutique and the young Cucinelli, innately attracted to beautiful things and their creation, became interested in fashion.

The region was already an established knitwear-manufacturing area with a specialization in cashmere, making it a logical strategic base for his business. In 1978, Cucinelli had the idea of dyeing cashmere (which until then had only been available in muted colors) and marketing it to women.

Cashmere had mostly been used for men's sweaters, but he designed them with more flatteringly feminine shapes. He set up a workshop with a ITL500,000 loan(the equivalent of US$325) and made a small collection with five styles and 53 sweaters that sold out immediately.

"I wanted to make something special, something luxurious. I decided to make something that others could not reproduce easily and something that you would want to keep forever," he recalls.

Redefining the fine luxury market

His idea revolutionized the world of cashmere, turning it into a luxury item with a rapidly expanding market. Foreign distribution was key.

After just a few years in business and with thriving European sales, Cucinelli was already looking abroad. He bought a stake in Rivamonti, a wool knitwear specialist, in the mid-1980s and established an American wholesale distribution subsidiary, Brunello Cucinelli USA, in 1986.

In the early 1990s, Cucinelli bought Gunex, makers of women's trousers and skirts, and used a multibrand distribution channel to establish his American presence, eventually subsuming the Rivamonti and Gunex brands into the Brunello Cucinelli brand two years ago.

As your brand grows, it becomes inflated and you risk losing your specialness.

Today, the Cucinelli knitwear production relies on a network of expert artisans located within a 40km radius of Solomeo. Exacting quality control is undertaken in-house, while the newer lines of clothing and shoes are made by artisans in the Marche and Tuscany regions.

The company, like many other successful Made in Italy luxury manufacturers, has been relatively untouched by the recession, and produced close to a million cashmere garments in 2012, posting a net annual turnover of US$363.3m [€279.3m], a 15.1% increase on the previous year.

The cachet of cashmere by Cucinelli

Brunello Cucinelli is a brand so exclusive that most Italians have probably never set foot in a Cucinelli store. More than three-quarters of the brand's products are sold abroad, where Cucinelli is present in over 50 countries, with more than 80 capital city mono-brand stores and a presence in about 1,000 multi-brand luxury department stores.

Foreign sales are concentrated between the US, China and Europe, with growing markets in Japan and Korea. It occupies the upper echelon of the absolute luxury segment.

Exclusiveness has been a critical success factor for Cucinelli, but one he must delicately balance with growth. "One very wealthy Chinese client said to me recently that, if I opened any more stores in China, she would cease to be my client.

As your brand grows, it becomes inflated and you risk losing your specialness. We have to be more special, not less. I want to try and govern my exclusivity.

We pay extreme attention to distribution," he says. Distribution is controlled through a mix of mono-brand directly owned and franchised boutiques in capital city fashion districts and exclusive resorts, as well as positioning in luxury department stores.

Philosophy and business

Marrying humanist philosophy with high-end fashion might seem like a contradiction in terms, but Cucinelli has managed to incorporate abstract ideals about improving human dignity into an industrial context. Making money is an objective, but it is clearly not the only objective.

Apart from the Solomeo renovation and distributing profits among his employees, he has funded study grants at the University of Perugia and hosts benefit concerts, plays and musical productions. He also reads extensively, dropping names such as Spinoza, Rousseau, and even Pope Francesco into the conversation, while citing the ideas of ancient philosophers as the basis of his business approach.

"I don't think of myself as an owner," he says, "but as a custodian. When you start to think of your business like that, it changes your whole perspective."

Part of this perspective was widening the circle of "custodians" who could be a part of its increasingly global distribution, and the company took a major new direction by listing on the Milan Stock Exchange last April, a unique initial public offering in 2012. Twelve months on, Cucinelli has been delighted with the overwhelming interest shown by investors.

His approach to the listing, like so much else in his company, was unconventional business sense. "We didn't do it because of debts.

We could have possibly been a little more solid financially, but we don't have debts. Of course, we have capitalistic aspirations and plans for expansion, but that wasn't only it.

This company had been just mine for 34 years, but in 2010, I decided I wanted it to be even more international. I wanted to meet investors who could also be custodians of the company," he says.

Built to last

Yet investors who were looking for a meteoric profit were to be disappointed. "I want this company to last for 100 years and I am working on business plans now up to 2020.

I can't be interested in four-day profits and losses, and I was looking for investors who would understand that," he says. Expansion is tangible, and plans are under way to increase operations in other countries with emerging luxury markets, such as India.

I don't think of myself as an owner of a business, but as a custodian.

A bigger facility to cater for the company's projected business over the next seven years is being built across the road from the main sales offices in a small industrial estate at the foot of the Solomeo hill. There is certainly nothing medieval about the current elegant facility, where scores of young, immaculately dressed men and women (the average age in the 780-strong company is 36) staff an enormous open-plan sales office that hums with quiet, purposeful activity.

At the front of the office is a display of the brand's latest casual-chic looks. Each beautiful garment is a testimony to the work of the artisans up on the hill or in the various workshops scattered over the local area.

It is a Made in Italy luxury segment that Cucinelli insists must become "more special, more exclusive" to continue thriving in a world where humanist capitalism has ceased to be an oxymoron and has started to become a sustainably profitable industrial approach.