As the agency reconcentrates its prospects on China amid the pandemic, even more than 75 percent of the 400-perchild staff has actually been let go, while 18 out of 19 stores are cshedding. But the contemporary brand"s business model was challenged long before Covid-19.

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Diane Von Furstenberg walking the runmethod at a fashion present on February 15, 2015. | Source: Shutterstock

NEW YORK, United States — After multiple rounds of restructuring and years of decreasing sales, New York-based label Diane von Furstenberg has actually lhelp off the majority of of its team and is changing its organization to a digital-only, China-concentrated version, BoF has actually learned.It’s a major setback for a designer who is still, in the eyes of many kind of, associated through American fashion, attributed with presenting the wrap dress and also mentoring generations of young talent. But prefer so many type of modern brands, DVF has discovered itself squeezed by quick fashion and also the decline of department stores. The coronavirus pandemic, which closed stores and is expected to drive down consumer spfinishing on fashion, was the last blow.

Multiple sources close to the company told BoF that much of the executive team was let go from DVF in at an early stage June. Chief Executive Sandra Campos resigned, and Vice President of Production Holliday Hofstatter is no much longer at DVF either. This comes on the heels of layoffs in May, wright here 75 percent of the company’s approximately 400 employees were let go, leaving the team down to a “skeleton crew.” Employees said layoffs were done over Zoom and also without any comment from von Furstenberg. Some employees were let go without severance.

The worldwide businesses of DVF in England also and France will shutter. (At the finish of May, the brand’s British subsidiary, DVF Studio UK, entered administration, the country’s indistinguishable to Chapter 11.)

DVF will cshed 18 retail areas, leaving just its store in New York City’s meatpacking district, which von Furstenberg owns. (The extra floors are the company’s office, studio and also a live-work-related space for the designer.) Stores that have been closed bereason of Covid-19 will reopen soon and begin to liquidate merchandise.

Representatives from DVF decreased to comment. Von Furstenberg did not respond to emailed requests for comment.

DVF joins the pileup of fashion brands struggling to recoup from the coronavirus pandemic. The global fashion industry is projected to view revenue decrease by approximately 30 percent this year, according to The Firm of Fashion and McKinsey’sState of Fashion report coronavirus edition.

Fashion giants such as Gap, Macy’s and Tommy Hilfiger and Calvin Klein parent firm PVH Corp. have reported losses of around $1 billion each. Retailers including Neimale Marcus and J.C. Penney have actually filed for bankruptcy, while Brooks Brothers and Ann Taylor parent firm Ascena Retail Group are supposedly considering the very same.

The DVF brand started in 1972, once von Furstenberg, then married to her first husband, the German aristocrat Prince Egon von Furstenberg, introduced the wrap dress. Von Furstenberg’s success embodied the Amerideserve to dream: she was in her 20s and also had immigrated to the US once she introduced her brand. She also nabbed a cover of Newsweek in 1976.

The 73-year-old designer, in many methods, is identified through Amerihave the right to fashion. Von Furstenberg was the chairmale of the Council of Fashion Designers of America for 13 years and has mentored developers including Alexander Wang. The brand also is privately owned and family-run; von Furstenberg sits on the brand’s board, as execute her husband also, Barry Diller, and her kids Alex von Furstenberg and also Tatiana von Furstenberg.


DVF’s best years were in the at an early stage 2000s. Key to its success back then was Paula Sutter, that offered as president from 1999 to 2013, and also aided DVF construct a second revival after its initial boom in the 1970s. Sutter assisted the fashion label thrive into a fashion way of living company, finish with shoes, accessories, and also a house goods repertoire.

But favor many fashion brands, DVF was struggling well before Covid-19. Sources said the firm created promising results from its direct-to-consumer e-commerce arm, but that didn’t make up for the high cost of running physical stores — it decreased its variety of areas from 32 to 19 over the last 2 years, some of which were international or franchises. It additionally had actually declining sales at department stores.

Campos, the chief executive that resigned last week, was brought on in 2018 from Global Brands Group, wbelow she was co-president of women"s apparel, which consisted of brands likeJuicy Couture and Herve Leger. She was tasked with revamping the company; she systematized the business’ multiple offices, introduced more affordable assets and also focused on its direct-to-customer channel.

With the focus on straight sales, DVF shrunk its wholesale footprint. But it has actually also shed essential accounts. It was dropped by Bloomingdale’s, and also was stocked at fewer stores through Neiguy Marcus, Saks Fifth Avenue and Nordstrom. One employee who operated in merchandising shelp the brand was down to around 10 wholesale accounts in the US, and that many type of wholesalers did not want to occupational with the firm because the product didn’t sell well.

Clopoint from the DVF label starts at around $200, however deserve to go all the method approximately $1,800, putting the brand in the category of mid-priced fashion labels that have actually been edged out in recent years by cheaper choices from rapid fashion and also the growing resale industry. DVF’s designs were never rather distinct enough to organize customers’ attention in an increasingly crowded sector. Sources sassist revenue is intended to come in well below $250 million this year, dvery own from a reported $500 million in 2015. DVF had been looking for a buyer and also was additionally considering licensing its brand also name.

The decline of the DVF brand also is representative of the dangers of wholesale. Even via a founder and also brand also name as recognizable as von Furstenberg"s, fashion designers have lengthy been struggling with cancelled orders, delayed payments, and excess inventory because of their wholesale partnerships. Coronavirus reduced deep, with retailers resorting to fire sales in order to geneprice much-required cash to pay rent and salaries. Large fashion brands like DVF that have tried to pivot found that expansions over the years had left them with bloated business models that were expensive to finance.

DVF is still emerging its business setup, but sources say the firm has hired designer Nathan Jenden for the 3rd time. Jenden worked for the company for a decade and was instrumental in DVF’s growth. After leaving in 2011, DVF cycled with a few imaginative directors till it hired Scottish designer Jonathan Saunders in 2016 as its initially chief imaginative officer. Saunders resigned in 2017, via friction coming from imaginative differences. Jenden was temporarily hired ago to DVF from the Global Brands Group-owned Bebe (wbelow he met Campos) however departed aget in 2018.

The company"s global wholesale service was percreating better than its US one, and so the company plans to store marketing DVF to a couple of wholesalers in Europe, under a little team in London.

Sources say the firm will currently largely focus on wholesaling to stores in China — an initiative that will certainly be run by Gabby Hirata, the company’s head of company breakthrough for Asia-Pacific. It’s unclear if the firm will still be running its e-commerce operations in the US once it sells out of the Spring collection presently on the site.

As a designer and businesswoman,von Furstenberghas recreated herself many kind of times. Her various business models reflect the fashion industry"s trajectory; the reality that she is concentrating on China, which was responsible for 38 percent of the international fashion industry"s expansion over the last decade, suggests that the firm can well weather this tough time.

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"Empowering woguys is somepoint I"ve always done," she told BoF in 2018. "It"s not a marketing tool."

Editor"s Note: This story was updated on 16 June, 2020 to reflect thatSanda Campos resigned from DVF, and was not laid off.