Strategy
LPP is a Polish family company.
Our goal is to continuously develop LPP and transform it into an increasingly sustainable company that responds to the climate challenges of today. We are incessantly improving our offer and adapting it to the ever-changing customer expectations. Our collections are more and more accessible thanks to the extension of our traditional stores network (increasing commercial floorspace YoY), as well as online stores. We are driving our development towards the omnichannel concept to ensure that our customers have full access to the products, regardless of the sales channel. At the same time, we are constantly responding to the challenges posed by the world around us in both technological and environmental context. With this LPP development plan in mind for the years to come, we founded our strategy on three pillars: the omnichannel model, digitalisation and sustainable development. 1. OMNICHANNEL ORGANISATION LPP is an omnichannel organisation where offline and online sales are fully integrated. We are committed to providing our customers with the best possible shopping experience, regardless of whether they choose to purchase our collections in traditional stores or online. That is why we develop both channels simultaneously while ensuring a coherent presentation of our offer. Our priorities are as follows: DEVELOPMENT THROUGH BRANDS We focus on attracting new customers and boosting the satisfaction of the existing ones. The beginnings of our portfolio are marked by our Reserved brand and 1998 which saw the opening of its first store. Currently, we manage five brands – each dedicated to a different target group. Our offer includes collections for women and men, as well as children’s apparel and clothes for teenagers. Reserved, Cropp, House, and Mohito are in the mid-price range, while Sinsay in the Affordable Fashion Retail segment. For the time being, we are not planning any launches of new brands. Our actions are focused on the brands that already make up our portfolio, with particular emphasis on Sinsay. Originally dedicated to teenage girls, the brand now also offers fashionable styles for young women and men. Sinsay also offers collections for mothers, as well as products and accessories for children. Sinsay’s product range is complemented by home décor items, as well as make-up and skincare line. The positive reception of the new Sinsay concept on the market and the accompanying intensive development of the stationary network, mainly in small towns, will result in a gradual increase of Sinsayss share in LPP’s brand portfolio over the next few years.
DEVELOPMENT THROUGH OFFLINE AND ONLINE RETAIL NETWORK EXPANSION
Development through brands would not be complete if not for a simultaneous expansion of our traditional and online retail network.
We aim to ensure Group revenues diversification, i.e. to maintain the current position on the Polish market and to increase the share of foreign sales, especially in region of European Union. Currently, revenues from the domestic market constitute over a half of our Group’s total revenues.
Today, we are present in six geographical areas on three continents, each with different growth prospects:
– LPP originates from Poland and this market remains its most important area of business activities. It generates the majority of the company’s revenue. Taking into account the maturity of this market and the vast retail network, we mostly focus on maintaining the importance of the LPP brands, refreshing the concept of the stores and expanding the retail floor space. We are going to work on developing the retail network but focus on the younger brands.
– Central and Eastern Europe (CEE), which includes countries such as: Poland, the Czech Republic, Slovakia, and Hungary. Due to the well-established presence of all our brands in this area, we consider it to be a mature market. Therefore, the focus here is mainly on developing the stationary network in smaller towns where we see development potential for younger brands, especially Sinsay. We are expanding the traditional store chain mainly through retail parks, but also through high street stores. In parallel, we are modernising the stationary network in large cities and successively expanding and refreshing store concepts in order to fully implement the omnichannel model and adapt our stores to new market requirements and customer expectations.
– The countries of the Baltic Sea Region (BSR), where our brands are currently present include Lithuania, Latvia, and Estonia. We regard all the three countries, as well as the CEE markets, as mature and hence focus on developing younger brands in smaller towns, mainly in retail parks.
– The Eastern European region i.e. Ukraine, Belarus and Kazakhstan. Due to war in Ukraine, our development in Eastern Europe has been put on hold.
– South-Eastern Europe (SEE) i.e. Bulgaria, Romania, Croatia, Serbia, Slovenia, Bosnia and Herzegovina, North Macedonia and Greece are markets with high growth potential for all LPP brands. We are gradually expanding our stationary network there, and we plan to continue strengthening
– Western Europe (WE) i.e. Germany, the UK, Finland and Italy, are countries where we want to strengthen the position of our brands and develop our retail network.
– The Middle East (ME) i.e. Egypt, Qatar, Kuwait, the United Arab Emirates, and Israel. Our presence with Reserved brand in this region is based on cooperation with a franchise partner. At the same time, we continue to sell online through external sales platforms.
In response to changing customer preferences and behaviours and the ubiquitous digitalisation and transformation in retail, our omnichannel strategy involves a holistic approach to both sales channels, i.e. traditional and online. As a result of the situation related to the outbreak of the COVID-19 pandemic, the qualitative and quantitative development of the online channel has become a priority for LPP. The inseparable elements supporting the development of the online channel are logistics and technology which determine the success of e-commerce and customer satisfaction. For this reason, our company focuses its activities on expanding its distribution network (distribution centres and warehouses dedicated to e-commerce services, i.e. fulfilment centres) in Poland and abroad and gradually increasing the share of state-of-the-art technologies in logistics and customer service processes.
At the end of 2021/22, the offer of our brands was available in a total of 39 countries – including offline in 26 and online in 33 countries.
2. DIGITALISATION OF THE ORGANISATION
We operate in the area of fashion, but at the same time, in response to the revolution observed in the clothing industry, we are a tech-oriented company. We create original IT solutions tailored to our needs. We implement state-of-the-art technologies, the so called Fashion Tech, throughout the value chain, starting with the product, through logistics and sales. We have our own analytical facilities, which allows us to understand megatrends and customer expectations. This, in turn, enables us to respond flexibly and quickly to changes in shopping preferences and to design collections in tune with the current needs of our customers. Without the digitalisation of our organisation, the implementation of LPP’s business strategy would not be possible.
As part of our Fashion Tech activities, we focus our efforts on using modern technology to:
- continuously improve our collections in line with our customers’ expectations,
- expand our range of sales and after-sales services in line with global retail trends,
- increase the flexibility of our distribution network,
- fully integrate traditional and online channels in the spirit of the omnichannel strategy.
3. SUSTAINABLE DEVELOPMENT
In the times of growing awareness as to the importance of responsible business, elements of our concern for our surroundings – the environment and people alike – are reflected in the LPP strategy. We base the company’s development on sustainable rules for all processes within the company.
Our sustainable development strategy is tantamount to responsible fashion, which means thinking about our collections not only from the perspective of clothing design, its production, distribution and use, but also giving our clothes the so-called second life after the end of the process of its use by customers.
Such a comprehensive approach is our response to current climate challenges. Every year, we want to effectively reduce the negative environmental impact of LPP but also to educate our customers and business partners how we can make joint efforts to effectively take care of the planet for our own sake, but also for the future generations.
In 2019, we announced our second LPP Sustainable Development Strategy “For People For Our Planet” to be implemented in the years 2020–2025, based on four pillars: design and production, elimination of plastics, chemical safety, and infrastructure and buildings. This is our action plan and the goals we have set ourselves for the near future, but also a demonstration of our responsibility for our environment.
Our sustainable development also entails socially-oriented actions of the Company, the vast majority of which is implemented via our LPP Foundation established in 2017. We help children and youth in a difficult life situation and the ill. Moreover, we provide support to medical care facilities and organisations taking care of persons at risk of social exclusion.