Arezzo&Co has developed a unique business model in Brazil, supported by its reference brands and great focus on its customers.
Navigate through Arezzo&Co’s business model pillars:
Costumer focus: we are at the forefront of Brazillian women fashions and design
Business Models Bases
Research and development
Arezzo&Co offers its customers 7-12 collections every year. The Company maintains a solid research and development process, coupled with a structured sourcing and logistics model.
The first step of the research process consists in identifying the consumer’s behavior and fashion trends. Arezzo&Co maintains a constant monitoring of trends in the world’s major consumption centers, which supports our internal team’s creation of a wide range of products in each collection. Currently we have records of products going back 40 years, with some 30 thousand pairs catalogued.
Every year, approximately 11,500 models are developed and gradually filtered by the product development team. After filtering, about 65% of the models are shown to the sales team and the operators, and finally production starts on the models to be sold in the stores, which represent 50% of the total number developed.
This process enables the Company to consistently provide customers with the most fashionable and successful models in every collection.
Constant research and studies are carried out before determining the most appropriate manufacturing process for each product (flexible sourcing model).
The products are manufactured at the Company’s own industrial facilities (located in the city of Campo Bom, state of Rio Grande do Sul) or in independent factories and workshops hired by Arezzo&Co, which are selected according to the particularities of the product to be manufactured. These manufacturers produce the items with part of the material supplied by Arezzo&Co and following the technical specifications and quantities requested.
The products are distributed according to a coordinated program to the stores spread all over Brazil, supported by a solid logistics structure with capacity to deliver thousands of items per day.
The collections are simultaneously presented to all Brazilian sales points. Extra care is taken in updating the decor of the stores not only aimed to enhance the product’s display, but to provide an unique shopping experience.
Communication and Marketing
Communication and marketing are crucial for Arezzo&Co business model.
Considerable amount of time and cash are invested in the Company’s brands, which includes the continuous creation of marketing campaigns, as the Company strongly recognizes the importance of these actions to attain the brand positioning as market benchmarks.
Arezzo&Co has an efficient marketing strategy for its brands to appear constantly in the specialist media, by linking them to the artists and opinion-formers who are currently prominent, and by opening flagship stores – concept stores in strategically located streets in the main cities of Brazil, such as the flagship stores of the four brands Oscar Freire Street unrivaled shopping street in Latin America. The flagship stores are designed to promote brand recognition and to boost sales at our own stores, franchises and multi-brand retail stores.
It is worth stressing that Arezzo&Co is not a mere product retailer, but rather a Company that seeks to provide a unique shopping experience to customers. Thus, Arezzo takes extra care in updating and renovating the product catalogue for a new collection, decor of the stores, sales persons’ uniforms and packaging.
Sourcing & Logistics
Arezzo&Co’s production model includes own production at its industrial facilities located in the city of Campo Bom, state of Rio Grande do Sul, and the façon system, which consists of hiring independent factories and workshops that specialize in producing footwear for each type of product developed.
The Company provides its independent factories and workshops with part of the raw material necessary for production, which results in gains of scale in terms of inputs purchase, and in stricter quality and uniformity control of the materials used.
The fact that part of the production is carried out by independent factories and workshops leads to reducing the need for investment in installed production capacity as well as optimizes production by using the best labor available in each specialty.
The products are simultaneously distributed according to a coordinated program to all sales points in Brazil, supported by a solid logistics structure.
In 2016 the Company opened a new distribution center in Cariacica (ES), which has allowed for an increase in the open-grid restocking capacity and, with the center being closer to the main consumer markets, has led to a shorter lead time for restocking.
Arezzo&Co’s multiple distribution model allows for capturing value in the chain while widening distribution capillarity and brands’ visibility.
Its own stores are strategically located to leverage sales and stands as a mean to improving knowledge on retail. With them, the Company enriches its ability to interact with customer, learning and therefore improving its knowledge on the best practices of retail and management of points of sale. The flagship stores are an excellent tool for visibility and brand promotion, complementing Arezzo&Co’s marketing and communication strategy.
The franchise model allows rapid expansion with low investment. The franchise stores are adapted to the specific necessities of each region and are geared towards attaining high profitability levels, enabling the Company’s footprint presence at geographic areas where it wouldn’t make economic sense for own stores. Arezzo&Co’s awarded* franchise model is based on a win-win partnership.
The multi-brand retail stores consolidate the strength of other distribution channels by increasing the capillarity in small-size cities and for the new brands which the Company launches. Sales through this channel reach all the Brazilian states, as well as around 50 countries abroad.
The e-commerce channel reinforces the Company’s OMNI strategy, which involves a permanent presence at all major points of contact with customers, to provide a unique shopping experience.
The Company also has its own operation in the United States, with wholesale, e-commerce and retail channels, through its flagship stores in New York and Los Angeles.
(*) AREZZO&CO has been awarded the Franchising Excellence Stamp from Brazilian Franchising Association (ABF) since 2004.
Arezzo&Co has a team of very experienced professionals with extensive knowledge in the footwear industry. Its meritocratic environment seeks for recruiting people with complementary expertise with communicative and interpersonal skills, encouraging discussion and dissemination of ideas inside the Company.
The people management area applies a wide range of selection, training and retention techniques to train and develop staff in line with Arezzo&Co’s organizational culture and strategy.