Born in 1881, craftsman’s son Guccio Gucci founded the Residence of Gucci as a saddlery shop in Florence in 1906. Guccio’s 1st talent was his craftsmanship in leather goods. He began out selling leather bags to horsemen inside the 1920′s and progressed to luxury luggage as his clients graduated from equine transportation to horseless carriages. In 1938 Guccio Gucci opened his 1st retail shop on the By way of Condotti in Rome.
Guccio Gucci, dishwasher to travel bag merchant
The company’s history definitely began in 1921 with patriarch Guccio Gucci, a Florentine dishwasher turned leather merchant, who began selling leather travel bags. Surviving both the Depression and World War II, the family business enterprise prospered on its use of a distinctively flawed leather referred to as “cuoio grasso,” the ruffled surface of which, superimposed with the twin Gs of the household name, became a global sensation in the years soon after the war.
Aldo builds the business regardless of family feuds
Unfortunately, a family schism began with Guccio’s sons. Aldo, the sharp-minded businessman, expanded Gucci’s business enterprise into new markets, shrewdly identifying its merchandise with distinct markings like red-and-green webbing. He relentlessly pushed for expansion, opening retailers in Paris, New York, even Tokyo. By 1974, author Sara Gay Forden wrote in her book, The House of Gucci, “The Gucci empire … numbered fourteen stores and forty-six franchised boutiques around the globe. In just twenty years Aldo had built Gucci from a $6,000 corporation as well as a small shop within the Savoy Plaza Hotel into a glittering empire spanning the United States, Europe, and Asia.”
But Aldo wasn’t totally above board. He also wound up in a $7 million tax fraud scandal, which ultimately enabled his nephew Maurizio to take control over the enterprise board of directors. Maurizio, son of Aldo’s brother Rodolfo, had already crossed swords with his father more than his marriage to Patrizia Reggiani, a truck driver’s daughter whom the elder Guccis saw as a gold-digger marrying her way to wealth. A fiery feud followed Rodolfo’s death, right after which Maurizio produced documents signing Rodolfo’s shares more than to Maurizio, which both saved him from massive inheritance taxes and created him a main shareholder.
That brought him squarely into conflict with Aldo. The legal battles that followed culminated with Aldo’s son Paolo squaring off with Maurizio, Aldo having been sent to prison in 1986 in the age of 81. The family members was disintegrating; boardroom meetings were punctuated by flying ashtrays and screamed obscenities.
Although the family fights the enterprise grows
But there was a silver lining even in acrimony. “Ironically, the fighting helped fuel the notoriety of the name,” Forden said. “It was a rare case where negative publicity wasn’t necessarily a bad thing. At 1 point I interviewed Luigi Pirovano, who was Rodolfo Gucci’s driver, and later Maurizio’s. He stated the household would fight and fight, and men and women would pour into the retailers and also the sales would grow, and it was as although there was a connection between the two.” Meanwhile, celebrities, led by Jackie Kennedy, embraced the brand.
Cash, blood takes its toll
Fighting between the relatives (and across generational lines) took its toll. By 1989, practically 50 percent of the small business had been bought out by Investcorp, a group of investment bankers angling for shares of the enterprise. Maurizio was ostensibly in charge, but Investcorp was in the driver’s seat. Maurizio put together a top-notch team: Gucci America CEO Domenico de Sole, creative director Dawn Mello, and head designer Tom Ford. It was an attempt by Maurizio to realize his forward-looking vision of Gucci as a modern corporate fashion entity. And, like numerous visionaries, he failed.
Embroiling himself in a spectacular divorce from Patrizia, Maurizio proceeded to run up unprecedented debts. He was regarded as a visionary leader but a poor manager by colleagues, which, coinciding with plummeting sales inside the early ’90s, brought on Maurizio to be edged out of the organization by Investcorp.
Tom Ford rises towards the best
De Sole and Ford advanced towards the top tier of Gucci below Investcorp’s leadership, with Mello returning to Bergdorf Goodman. Ford began churning out racy, groundbreaking new designs, like stiletto pumps and G-strings, which would in no way have observed the light of day below the Guccis. They had been exceedingly well known, and the Gucci name became much more beneficial than ever
Current Gucci Leadership
Former CEO Domenico de Sole and creative director Tom Ford, who restored Gucci’s glitz just after near bankruptcy inside the 1990s, departed when majority shareholder Pinault-Printemps-Redoute sought to limit their autonomy. Present Gucci CEO Mark Lee is bullish about 2006. In an interview with Women’s Wear Day-to-day, he said that the business “had the most beneficial year within the history of the enterprise, so we are quite proud and pleased about that”. Gucci, founded in 1921 by a former dishwasher, now consists of such well-known design labels as Yves St Laurent, Bottega Veneta, Sergio Rossi, Boucheron, Bedat & Co., Balenciaga, Stella McCartney, Alexander McQueen and, of course
