Kiabi Europe History

Company Perspectives:

Kiabi. Fashions for low prices. A name, a brand, a slogan, a symbol recognized by many. To the point that one might easily believe that Kiabi has always existed. And yet, Kiabi is just 25 years old. Twenty-five years of success, of a relationship with its public. But also a maturity that has led the company, in the context of the current market, to wish reinforce its position with its clients in all areas. Areas such as its product, with its collections developed across a larger universe in order to dress the whole family. Market using new methods of presenting collections. Retailing with a new store concepts. Without neglecting the will--unchanged since its beginnings--to respect what has made the company popular with shoppers: knowing how to provide "fashions for low prices."

Key Dates:

1978:

Patrick Mulliez opens his first Kiabi clothing store in Roncq and launches in-house brands Winch and Decade.

1988:

Celebrating its first decade, Kiabi opens its 35th store.

1990:

Children's clothing labels Tim Pouce and P'tit Caid are launched.

1993:

Kiabi enters Spain with a store in Valencia.

1996:

Kiabi enters Italy with a store in Milan.

2000:

The company begins converting all of its stores to a new design format and changes its name to Kiabi Europe.

2003:

"Coté Miss" clothing collection is launched for girls 8 to 14 years old.

2004:

Kiabi opens its 110th store in France, bringing its total number of stores to 125.

Company History:

Kiabi Europe is a leading French clothing retailer, operating 110 stores in France as well as 12 stores in Spain and three stores in Italy. Based in Hem, in the north of France near Lille and the Belgian border, Kiabi has set itself a goal of making fashion accessible to all, offering its own range of low-priced brands--including Winch, Decade, Tim Pouce, and P'tit Caïd--as well as a number of name brands, including Complices, Waikiki, Providence, and Fido Dido. One of France's pioneers of the "category killer" store, Kiabi's stores are typically located in commercial shopping areas outside France's mid- and large-size cities. Stores offer an average selling space of 1,500 to 2,000 square meters and feature some 50,000 clothing, accessory, and footwear items. The largest Kiabi store provides 4,600 square meters of floor space, while the smallest store stands at a nonetheless respectable 800 square meters. Kiabi stores features a full selection of women's, men's, and children's clothing, with each department further segmented into a number of "stories," grouping similar colors, materials, and styles. Since 2000, Kiabi has been carrying out an extensive store remodeling program and plans to convert all of its store to the new interior and exterior design by mid-decade. The company has successfully developed its own fidelity card system, with more than 1.5 million cardholders. Kiabi also provides other services, such as free and paid in-store alterations and staggered payment plans. The company provides logistics support to its operations with three warehouse and distribution centers and operates through four primary divisions: Kiabi France, Kiabi Spain, Kiabi Italy, and Kiabi Logistique. Founded by CEO Patrick Mulliez, Kiabi remains under the control of the powerful Mulliez retailing empire, which includes Auchan hypermarkets, Leroy Merlin do-it-yourself (DIY) stores, Boulanger home appliance stores, Decathlon sporting goods, the Flunch restaurant chain, among many other formats.

Discount Fashion in the 1980s

The Mulliez family had already established itself as one of the leading lights of France's retail sector by the time the first Kiabi store opened in 1978. The Mulliez's started out as manufacturers, founding Phildar, a textile company, in 1903. By 1946, however, the family had begun a shift to the retail sector, opening its first stores and producing a new range of Phildar-branded knitting and sewing supplies as well. The Phildar chain took off in 1956 when it began franchising the Phildar format.

The company's rise to retail giant status began with Gerard Mulliez, a high-school dropout who started his career in the Phildar manufacturing plant. In 1961, Mulliez decided to launch his own retail business, setting up a grocery store in Roubaix called Auchan.

Mulliez's initial venture failed. Yet, with family support, he tried again, this time adopting the self-service discount supermarket format just then being introduced into France. Opened in 1967, the new Auchan supermarket clicked with the shopping public, and Mulliez began opening new stores in northern France. By the mid-1970s, aided by the difficult economic climate brought on by the Arab oil embargo, Auchan had already established itself as one of northern France's major supermarket chains. At the end of that decade, Mulliez prepared to take on the rest of the country, beginning a national expansion that positioned Auchan and the Mulliez family in the top ranks of French retailers.

Gerard Mulliez's success inspired other family members to enter the retail world as well. By the early 1980s, Mulliez family members had founded many of the country's leading retail brands, adopting a "category killer" approach pioneered in the United States. The family's empire grew to include such dominant retailers as the Decathlon sporting goods chain and electrical appliance specialist Boulanger. The Mulliez family was also behind the launch of Flunch, a popular family-oriented, cafeteria-style restaurant chain and in the early 1980s acquired control of the Leroy Merlin DIY store chain.

In the late 1970s, another Mulliez family member, Patrick Mulliez, decided to build on the family's background in the textile industry to open a new style of clothing store. Called Kiabi, the new format became one of the first in France to offer a large-scale selling space devoted exclusively to clothing. Featuring its own clothing designs and labels, and later incorporating other branded items as well, Kiabi was launched as a low-priced fashion concept with the motto: "La mode à petits prix" ("fashions for low prices"). Backed by his family's know-how in the textile manufacturing sector, Mulliez was able to ensure a quality product.

Mulliez opened the first Kiabi in the town of Roncq, outside of Lille, in 1978. This store already displayed the company's preference for scale, with a selling space of 1,000 square meters. Accompanying the launch of the store were the company's first two in-house brands, Winch, representing the Kiabi's sportswear fashions, and Decade, featuring more classic, "city" styles.

The first Kiabi was an immediate success, and Mulliez quickly began adding new stores. By 1979, the company had three stores and 150 employees. Less than a year later, there were already seven Kiabi stores and 450 employees. From there, the company's growth accelerated, and by its 10th anniversary, Kiabi had already opened 35 stores, as well as two logistics and distribution centers. By then, the company had sold more than ten million pieces of clothing.

International Expansion in the 1990s

Kiabi initially targeted the men's and women's clothing segments. The growing retail clout of the children's clothing market at the end of the 1980s and into the 1990s encouraged the company to expand its line of styles to include the segment ranging from infants to teenagers. As part of this effort, Kiabi launched a new brand insignia and in 1990 included the Tim Pouce and P'tit Caid labels. The company continued to add to its range of items, offering accessories, maternity wear, and footwear. By the end of the 1990s, the typical Kiabi store had grown to 2,000 square meters--with the largest store at 4,600 square meters--and featured more than 50,000 different clothing, accessory, and footwear items.

Kiabi continued to conquer France in the 1990s, jumping from 50 stores at the beginning of the decade to 100 stores by 2000 and 110 stores by the end of 2004. By the mid-1990s, Kiabi had already established itself as one of the major clothing retailers in France, claiming the number four spot for all retail textile sales and the number one spot among specialized large-scale clothing shops. Kiabi's sales at mid-decade were estimated at FFr 4.4 billion ($800 million).

A large part of the group's success was due to its dual commitment to low prices and quality. As part of the latter effort, Kiabi launched a new clothing range called Kiabi 4 Etoiles, which included a two-year guarantee, in 1995. Also in that year, Kiabi introduced its fidelity program, and less than a decade later the company had built up a base of some 1.5 million cardholders.

In the meantime, Kiabi had set its sights on new horizons. In 1993, the company opened its first international store, in Valence, Spain. That marked the beginning of Kiabi's expansion into the Spanish market, bringing it head to head with the likes of Spanish retail clothing powerhouse Zara. Nonetheless, the first Kiabi met with success, and the company began constructing a Spanish retail network as well. In 1996, the company opened a second Spanish store, in Saragosse, followed by a store in Barcelona in 1998 and one in Madrid in 1999. By 2003, the company had opened a second store in Madrid, as well as stores in Pampeluna, El Ferrol, and Oviedo. In 2004, the company began construction on four new stores, bringing its total in Spain to 12.

Spain was not Kiabi's only international target. In 1996, the company turned to the Italian market, where it faced such rivals as Benetton and Diesel on their home turf. The first Italian Kiabi store was opened in Milan in 1996 and was joined by a store in Ferrara in 1999 and another in Bari in 2000. Deeper penetration into the Italian market appeared difficult for the company, however, especially given the difficult economic climate at the beginning of the decade. After putting its Italian expansion temporarily on hold in the early 2000s, Kiabi began developing a new expansion strategy, with new stores planned in the 2004 to 2007 period.

New Look for the New Century

Back in France, Kiabi began testing a new store format in 2000, converting its first three stores to the new look in August of that year. The positive reaction to the design led the company to plan a full-scale rollout of the new store format, with the conversion of all of the company's stores expected to be completed by mid-decade. As part of the change in format, the company redeveloped its in-store presentations as well, developing its clothing collections as a series of "stories" that each revolved around similar colors, fabrics, and styles. Kiabi also launched a new clothing collection, "Coté Miss," in 2003. The new line was specifically targeted at the fast-growing clothing segment for girls 8 to 14 years old, who had a penchant for adult-like fashions.

In the early 2000s, Kiabi also redesigned its corporate structure, changing its name to Kiabi Europe and regrouping its operations under four primary divisions: Kiabi France, Kiabi Spain, Kiabi Italy, and Kiabi Logistique. The new structure gave the company an effective oversight for its future expansion plans, with new stores planned in each of its geographic markets. The success of the Kiabi concept appeared certain to appeal to a broader European market in the new century.

Principal Divisions: Kiabi France; Kiabi Spain; Kiabi Italy; Kiabi Logistique.

Principal Competitors: Redcats; Vivarte; La Redoute; La Halle; Somfy International S.A.; Damartex S.A.; Zara France S.A.R.L.

Further Reading:

• Cristofari, Jean-François, "Kiabi," Marketing Magazine, January 1, 1998.
• "Dossier de presentation," Kiabi SA, January 2004.
• "Kiabi, 22 ans de succès," Voix du Nord, November 11, 2000.
• "La PME-école de kiabi," Nouvel Observateur, September 23, 1999.

Source: International Directory of Company Histories, Vol. 66. St. James Press, 2004.