Benetton Family

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Company History: Benetton Group S.p.A.

Company Perspectives:
Today the Benetton Group is present in 120 countries around the world. Its core business is clothing: a group with a strong Italian character whose style, design expertise and passion are clearly seen in the United Colors of Benetton and the more fashion-oriented Sisley brands, and in sportswear brands Playlife and Killer Loop. The Group produces over 110 million garments every year, over 90% in Europe.
Key Dates:
• 1955: Giuliana and Luciano Benetton buy their first knitting machine and begin selling Giuliana's woolen sweaters.
• 1965: The Benetton family forms a partnership, Maglificio di Ponzano Veneto dei Fratelli Benetton.
• 1972: The company introduces a new
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Production at the company was also unique. In 1972 Luciano introduced a time- and money-saving production technique. By dyeing assembled garments made of unbleached wool rather than batches of yarn before knitting, manufacturing time was trimmed and Benetton could produce garments upon demand, which minimized the need to maintain an extensive inventory.
To produce many sweaters at reduced cost and financial risk, Benetton took advantage of an old Italian cottage industry. Benetton farmed out labor-intensive production--knitting and sewing--to small, family-owned companies (many owned in whole, or part, by Benetton management) throughout northeast Italy. Employing advanced technology, these companies allowed Benetton to manufacture in response to increased market demand both domestically and abroad with reduced financial risk. About 80 percent of production was farmed out to 450 subcontractors who employed about 20,000 workers in the Veneto region. The remaining 20 percent of value-added, capital-intensive production--quality control and cutting and dyeing--was performed in house. By 1983 Benetton payments for contract work equaled nearly six times the labor expense for work performed in its factories, according to the Harvard School of Business.
Benetton's early success is attributable as much to Luciano's genius, as to the Italian and local business
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