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The global fashion business journal

17 Nov 201807:26

h Companies

An old-style Mango to redirect the way

The company recovers the position of a general manager and puts a financer in charge of the role again, underpinning once more the dichotomy finances-operations formula used during its golden years , when Enric Casi occupied the mentioned position in the firm from 1996 to 2015.

29 Oct 2018 — 12:00
Silvia Riera
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An old-style Mango strategy to redirect the way

 

 

In the old-style way. Following the saying that if something works, why change it, Mango recovers the position of general manager and names its current financial director, Toni Ruiz, to lead the mentioned role as Modaes already advanced last Friday. With the naming of the company’s first spearhead, the brand recovers the formula it already had during its golden period, when Enric Casi, with a profile completely characterised by finances, made Mango overcome the bar of two billion euros.

 

Casi was the corporation’s general manager between 1996 and 2015, during the two decades in which the brand experienced an accelerated expansion. Before taking the lead in the company, the executive had been involved in it for ten years, firstly as external auditor and later, leading the executive functions.

 

The year of his departure, Mango reached its record revenue of 2,32 billion euros. Between 2011 and 2015, during the period of crisis, the company made its income escalate a 65%. Nevertheless, during these five years, rentability worsened. Mango ended 2015 with a net profit of 11.8 million euros, far from the 113.4 million euros from barely three fiscal years ago.

 

 

 

After his exit, the company signed Toni Ruiz as their financial officer, who came from another international retailer, Leroy Merlin. However, Ruiz did not assume the role of general manager, which was back then erased, and piloted the company jointly with the operations manager, Carlos Costa. Costa and Ruiz shared the duties which until then had to be done by the general manager.

 

The departure of Enric Casi and the suppression of the general manager position was produced shortly after Jonathan Andic, son of the company’s founder, ascended in the brand’s organisation chart to the role of managing director. During that period, other historical directives like Isak Halfon left the company too. Now, Jonathan Andic will report to Toni Ruiz, as well as Carlos Costa and Daniel López will do, the latter one being the firm’s vice-president.

 

The dichotomy finances-operations at the top of the leadership seems to have stopped working, at least taking into account the results of the last two fiscal years. Between 2015 and 2017, Mango’s sales have dropped a 6%, reaching an amount of even 2,19 billion euros. The net result, on its part, was overdrawn during 2016 for the first time in its history. In 2017, the company cut down its losses, registering a negative net benefit of 33 million euros.

 

 

 

During the last year, the company did a clean-up of its balance, which led to a strong cut of its bank liabilities and a reduction of the net financial debt. On the other hand, the group continued reorienting its model of business towards fast fashion, opening macro-stores and expanding through franchises.

 

Now, applying the old formula of an organisation chart led by a financer, under Ruiz’s responsibility falls the improvement of the company’s results, the digital transformation and making the organisation suitable to the sector’s actual challenges, just like the founder and president of the group, Isak Andic, communicated last Friday to the personnel.

 

Moreover, the designation is produced amid rumours of a possible sale of the company once the initial public offering has been disregarded. Both options, however, are hard to solve whilst recovery continues to be aggravated and net results are still negative.

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