BARBARA BUI relocate production to Eastern Europe

Barbara Bui, one of France’s few listed fashion brands, is repatriating part of its production from Asia to Europe to improve quality and sales, which it expects to rise just under 10 percent this year.

"The year has started very well for us, wholesale distribution networks are in a recovery phase," Barbara Bui Deputy Chief Executive Jean-Michel Lagarde told the Reuters Global Luxury and Fashion Summit in Paris. He said he expected the brand’s wholesale revenue, which makes up two-thirds of sales, to rise 7-8 percent this year, while revenue from its 13 boutiques should increase 8-10 percent.

Sales slipped to 29.3 million euros ($41.3 million) last year from 30.2 million in 2009 as wholesale trading remained sluggish. Barbara Bui had cash of 4.3 million euros at the end of the year, which it said was enough to finance new shops this year, including a new outlet in Beirut.

The company stopped its cheaper second line five years ago in spite of its commercial success and is now focused on moving upscale and developing a luxury image, a strategy that has led it to switch part of its production to Europe.

"We are currently in a wave of repatriation of our production even if that means higher costs," Lagarde said. "For example, we tried to make bags in Asia but the quality was not high enough."

Lagarde said having production in countries such as Romania, Bulgaria and Hungary, as opposed to Asia, facilitated regular interaction with manufacturers, tighter quality control and allowed products to get to market faster.