Escada and Strenesse

German Luxury Brands Flail

luxurybrands.DPA Jens Kalaene
Shoppers at a department store in Berlin, just one place in Germany where retail space has become prohibitively expensive for homegrown luxury brands.
  • Why it matters

    Why it matters

    The luxury fashion market has become a difficult place for German labels.

  • Facts


    • German companies like Strenesse and Escada are struggling to survive.
    • Increasing real estate prices and financial missteps contribute to their problems.
    • They also struggle to keep up with larger international labels.
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Megha Mittal, the owner of Escada, wants to reinvigorate the luxury fashion label. At least that’s what the 39-year-old said as models paraded past her front-row seat during the brand’s fashion show at Munich’s Nymphenburg Palace at the beginning of last year.

Back then there were great hopes of “forging onward with growth and international expansion,” Ms. Mittal said. But since then her hopes have been dashed by bitter reality.

Her new American chief executive, Glenn McMahon, resigned after only half a year. Then in October Ms. Mittal announced she would cut 10 percent of the company’s 2,000 jobs in the next two years.

Escada is not the only German luxury brand facing difficulties, either.

Fashion label Strenesse is fighting to restructure itself under its own management during insolvency proceedings. Laurèl is struggling to pay the interest on its commercial debt. And the Munich fashion store Rena Lange is bankrupt.

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