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Hugo Boss

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Hugo Boss
Company typeAktiengesellschaft
FWB: BOSS
IndustryClothing
Accessories
Founded1924 by Hugo Boss
Headquarters
Metzingen
,
Germany
Key people
  • Mark Langer, CEO, Bernd Hake
  • Michel Perraudin, Chairman
ProductsHigh-fashion
Accessories
Footwear
Revenue€2.809 billion[1] (2015)
€447.7 million[1]
€319.3 million[1] (2015)
Total assets€1.800 billion[1]
Total equity€955.7 million[1]
Number of employees
13,764[1]
Parent
90.08% Free Float
7.95% Marzotto Family
1.97% Own shares
Websitehttp://hugoboss.com/

Hugo Boss AG, often styled as BOSS, is a German luxury fashion house. It was founded in 1924 by Hugo Boss and is headquartered in Metzingen, Germany. Originally focusing on uniforms, it was a supplier for Nazi German Armed Forces and its related organizations during World War II. After the war and the founder's death in 1948, Hugo Boss started to turn its focus from uniforms to men's suits. The company went public in 1985 and introduced a fragrance line that same year, added mens and womenswear diffusion lines in 1997, a full women's collection in 2000 as well as children's clothing in 2008/2009, and has since evolved into a major global fashion house with more than 1,100 company-owned retail stores worldwide (2016).

History

Foundation

1933 Boss advertising for National Socialist uniforms

In 1924, Hugo Boss started a clothing company in Metzingen, a small town south of Stuttgart, where it is still based. Due to the economic climate of Germany at the time, Boss was forced into bankruptcy. In 1931, he reached an agreement with his creditors, leaving him with six sewing machines to start again.

Nazi Germany and World War II

That same year, he became a member of the Nazi Party and a sponsoring member ("Förderndes Mitglied") of the Schutzstaffel (SS). He also joined the German Labour Front in 1936, the Reich Air Protection Association in 1939, and the National Socialist People's Welfare in 1941. After joining these organizations, his sales increased from 38,260 RM ($26,993 U.S. dollars in 1932) to over 3,300,000 RM in 1941. His profits also increased in the same time period from 5,000 RM to 241,000 RM. Though he claimed in a 1934–35 advertisement that he had been a "supplier for National Socialist uniforms since 1924", it is probable that he did not begin to supply them until 1928 at the earliest. This is the year he became a Reichszeugmeisterei-licensed (official) supplier of uniforms to the Sturmabteilung, Schutzstaffel, Hitler Youth, National Socialist Motor Corps, and other party organizations. For production in later years of the war, Hugo Boss used prisoners of war and forced labourers, from the Baltic States, Belgium, France, Italy, Austria, Poland, Czechoslovakia, and the Soviet Union.[2] According to German historian Henning Kober, the company managers were fervent Nazis who were all great admirers of Adolf Hitler. In 1945 Hugo Boss had a photograph in his apartment of him with Hitler, taken at Hitler's Obersalzberg retreat.[3]

Because of his early Nazi party membership, his financial support of the SS and the uniforms delivered to the Nazi party, Boss was considered both an "activist" and a "supporter and beneficiary of National Socialism". In a 1946 judgment he was stripped of his voting rights, his capacity to run a business, and fined "a very heavy penalty" of 100,000 DM ($70,553 U.S. dollars).[2] He died in 1948, but his business survived.

Business in the 1950s–1990s

As a result of the ban on Boss being in business, his son-in-law Eugen Holy took over ownership and running of the company. In 1950, after a period supplying work uniforms, the company received its first order for men's suits, resulting in an expansion to 150 employees by the end of the year. By 1960 the company was producing ready made suits. In 1969, Eugen retired, leaving the company to his sons Jochen and Uwe, who began international development. In 1970, the first Boss branded suits were produced, with the brand becoming a registered trademark in 1977. This was followed by the start of the company's long association with motorsport, sponsoring Formula One driver Niki Lauda, and later the McLaren Racing team.

In 1984, the first Boss branded fragrance appeared. This helped the company gain the required growth for listing on the Frankfurt Stock Exchange the following year. The brand entered the world of golf by sponsoring Bernhard Langer in 1986 and entered the world of tennis by sponsoring the Davis Cup in 1987. In 1989, Boss launched its first licensed sunglasses. Later that year, the company was bought by a Japanese group.[4]

After the Marzotto textile group acquired a 77.5% stake for $165,000,000 in 1991,[4][5] the Hugo and Baldessarini brands were introduced in 1993. In 1995 the company launched its footwear range, the first in a now fully developed leather products range across all sub-brands. A partnership with the Solomon R. Guggenheim Foundation was launched in 1995, resulting in the Hugo Boss Prize, an annual $100,000 stipend in modern arts presented since 1996.

In 1997, the company appeared in a list of Swiss dormant accounts in connection with reparations lawsuits, which stirred the publication of articles highlighting the involvement of Hugo Boss with the Nazis.[6][7][8] In 1999, American lawyers filed lawsuits in New Jersey on behalf of survivors and their families for the use of forced workers during the war.[9][10] The company did not comment on these lawsuits, but reiterated an earlier statement that it would "not close its eyes to the past, but rather deal with the issues in an open and forthright manner".[9] In doing so it sponsored research by German historian Elisabeth Timm.[2] Nevertheless, after Timm told the press of her findings, the company declined to publish them.[11] In December 1999, an agreement was reached between the German government and the United States government along with a group of American class-action lawyers and Jewish groups. A fund equivalent to $5,100,000,000 U.S. dollars was to be financed equally by German industry and the German government, to compensate slave labourers used by the Germans in World War II.[12] Hugo Boss agreed to participate in this fund,[13] for an amount which was estimated by some sources to be $1,037,690.[14]

Development from the 2000s

Hugo Boss Store in Brisbane, Australia

In 2005, Marzotto spun off its fashion brands into the Valentino Fashion Group, which was then sold to Permira private equity group. In March 2015 Permira announced plans to sell the remaining shareholding of 12%. Since the Exit by Permira, 91% of the shares floated on the Börse Frankfurt and the residual 2% held by the company. 7% of the shares owns the Marzotto Family. Hugo Boss has at least 6,102 points of sale in 124 countries. Hugo Boss AG directly owns over 364 retail stores, 537 monobrand retail stores, and over 1,000 franchise-owned shops.[4]

In 2009, BOSS Hugo Boss was by far the largest segment, consisting of 68% of all sales. The remainder of sales were made up by BOSS Orange at 17%, BOSS Selection at 3%, BOSS Green at 3% and HUGO at 9%.[15]

In 2010, the company had sales of $2,345,850,000 and a net profit of $262,183,000,[4] with royalties of 42% of total net profit.[4]

In March 2010, Hugo Boss was boycotted by actor Danny Glover for the company's plans to close the plant in Brooklyn, Ohio after 375 employees of the Workers United Union reportedly rejected Hugo Boss proposal to cut the workers' hourly wage 36% from $13 an hour to $8.30.[16] After an initial statement by CFO Andreas Stockert saying the company had a responsibility to shareholders and would move suit manufacturing from Ohio to other facilities in Turkey, Bulgaria, and Romania,[17] the company capitulated to the boycott and cancelled the project.[18] Plans to close the plant again in April 2015 also failed.[19][20]

In September 2015, Hugo Boss (UK) was fined £1.2m in relation to the death in June 2013 of a child who died four days after suffering fatal head injuries at its store in Bicester, Oxfordshire.[21] The four-year-old boy had been injured when a steel-framed fitting-room mirror weighing 120 kg (19 stone / 250 lb) fell on him. Oxford Crown Court had earlier been told that it had "negligently been left free-standing without any fixings"[21] and the coroner had said that the death was an "accident waiting to happen".[22] In June 2015, Hugo Boss (UK) had admitted its breach of both the Health and Safety at Work Act 1974 and Management of Health and Safety at Work regulations 1999.[23] The company’s legal representative said: "The consequence of this failing is as awful as one could reasonably imagine. Since the day of the accident Hugo Boss has done all it can, first to acknowledge those failings, to express genuine, heartfelt remorse and also demonstrate a determination to put things right and ensure there cannot be a repeat of what went wrong".[23]

Products

Boss Bottled, a fragrance launched in 1998.[24]

There are two core brands, Boss and Hugo. The ranges are:

  • BOSS, which includes modern classic clothing in both men's wear (1970) and women's wear (2000).
  • BOSS Orange, which includes originally quirky styling with bohemian influences in both men's wear (1999) and women's wear (2005). This line was relaunched in 2010 as denim based casual wear.
  • BOSS Green, which was previously known as Boss Sport, includes golf-style active clothing in both men's wear (2003) and women's wear (2010)
  • HUGO, which includes fashion forward styling with a European look in both men's wear (1993) and women's wear (1998).

Products are manufactured in a variety of locations, including the company's own production sites in: Metzingen, Germany; Morrovalle, Italy; Radom, Poland; Izmir, Turkey; and Cleveland, United States.[25]

Hugo Boss has licensing agreements with various companies to produce Hugo Boss branded products. These include agreements with Samsung, HTC and Huawei to produce cell phones; C.W.F. Children Worldwide Fashion SAS to produce children's clothing; Shiseido and Procter & Gamble Prestige to produce fragrances and skincare;[26] Movado to produce watches;[27] and Safilo to produce sunglasses and eyewear.[28]

See also

References

  1. ^ a b c d e f "Hugo Boss Annual Report 2015". Hugo Boss.
  2. ^ a b c Timm, Elisabeth (April 18, 1999). "Hugo Ferdinand Boss (1885–1948) und die Firma Hugo Boss" (PDF). Metzingen Zwangsarbeit (in German). Retrieved December 31, 2010.
  3. ^ Kober, Henning (July 29, 2001). "Über den Umgang mit Zwangsarbeiterinnen bei Boss". Metzinger Zwangsarbeit (in German). Retrieved January 1, 2011.
  4. ^ a b c d e Chevalier, Michel (2012). Luxury Brand Management. Singapore: John Wiley & Sons. ISBN 978-1-118-17176-9.
  5. ^ "Marzotto S.p.A." The New York Times. November 2, 1991. Retrieved January 1, 2011.
  6. ^ Givhan, Robin (August 14, 1997). "Hugo Boss Factory Made Nazi Uniforms". The Washington Post. Retrieved January 2, 2011.
  7. ^ "Hugo Boss Acknowledges Link to Nazi Regime". The New York Times. August 14, 1997. Retrieved September 29, 2008.
  8. ^ White, Constance C. R (August 19, 1997). "Patterns: The Fallout on Hugo Boss". The New York Times. Retrieved January 1, 2011.
  9. ^ a b "Hugo Boss 'used slaves to work for Nazis'; Charge by Holocaust Survivors". The Daily Mail. May 15, 1999. Retrieved January 1, 2011.
  10. ^ Bazyler, Michael (2005). Holocaust Justice: The Battle for Restitution in America's Courts. NYU Press. p. 65. ISBN 978-0-8147-9904-8. Retrieved January 2, 2011.
  11. ^ Bourdoiseau, Christophe (June 23, 2000). "Les habits nazis de Hugo Boss". Le Point (in French). Retrieved January 1, 2011.
  12. ^ Andrews, Edmund L. (December 18, 1999). "Germany Accepts $5.1 billion Accord to End Claims of Nazi Slave Workers". The New York Times. Retrieved January 2, 2011.
  13. ^ "German Companies Participating in the Forced/Slave Labor". Jewish Virtual Library. July 8, 2000. Retrieved January 3, 2011.
  14. ^ Kober, Henning (June 18, 2002). "Besuch beim Boss". Taz (in German). Retrieved January 2, 2011.
  15. ^ "Results of Operations in Fiscal Year 2009". Hugo Boss AG. Retrieved February 13, 2011.
  16. ^ Glover, Danny (March 7, 2010). "Glover: Help Ohio Plant, Shun Hugo Boss At Oscars". Associated Press. Retrieved January 1, 2011.
  17. ^ Hugo Boss to move US factory production to Romania, Bulgaria, Turkey, trade union says
  18. ^ Covert, James (April 24, 2010). "Stars' factory crusade shows Hugo who's 'Boss'". the New York Post. Retrieved January 1, 2011.
  19. ^ Perkins, Olivera (December 2, 2014). "Hugo Boss says it will close Cleveland area plant in 2015, but unions ready to fight it — again". The Plain Dealer. Retrieved December 9, 2014.
  20. ^ Perkins, Olivera (March 20, 2015). "Hugo Boss plant will stay open with new owners, saving 160+ jobs". The Plain Dealer.
  21. ^ a b "Hugo Boss fined £1.2m over Bicester Village mirror death". BBC News Online. September 4, 2015. Retrieved September 5, 2015.
  22. ^ "Bicester Hugo Boss store admits charges over boy's mirror death". BBC News Online. June 3, 2015. Retrieved September 5, 2015.
  23. ^ a b Press Association (September 3, 2015). "Hugo Boss faces huge fine over toddler's death in store". The Guardian. Retrieved September 5, 2015.
  24. ^ "Boss Bottled (1988)". Basenotes. Retrieved January 7, 2012.
  25. ^ "HUGO BOSS AG Organisational Structure". Hugo Boss AG. Retrieved February 13, 2011.
  26. ^ "PG.com HUGO BOSS: fragrances, contemporary design, design competition". Retrieved February 13, 2011.
  27. ^ "Movado Group Inc". Retrieved February 13, 2011.
  28. ^ "Safilo Group S.p.A/". Retrieved February 13, 2011.

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