This Asian Turnaround Specialist Spun Straw Into Gold
David Pun once decided to spin straw into gold and succeeded. Thus was reborn Evisu Genes.
Evisu, a premium denim fashion house founded in Japan in 1991, saw a management-led buyout in 2010 when former private equity executive director Pun discovered the latent potential of Evisu’s historical brand equity.
The company’s untapped potential was explored then with David Pun, the company’s Group Chairman and CEO, turning the niche denim brand’s fate from bankruptcy to one of the prominent lifestyle brands internationally.
During early days, only 14 pairs of Evisu jeans were created a day, each one caringly hand-painted with its signature seagull logo. Today, Evisu has expanded beyond denim with a full lifestyle range of offerings.
After the management buyout of Evisu in 2010, Pun re-positioned Evisu for growth in Asia by exiting its former sales strongholds in Europe and the US. Despite the risks and noise in the market, Pun's lean turnaround strategy paid off. Just one year later, Evisu went back into black after four years in the red.
Since 2012, Evisu has grown from 20 to 150 stores in China. At end of 2016, Evisu raised financing of $40 million in a bold move to buyback China JV, targeting to double sales in China from RMB500 million to RMB1 billion by 2020.
In a chat with Entrepreneur Asia Pacific, Pun spoke of some of the things he has never spoken about.
The greatest gift about starting a business is my beloved colleagues and management team Pun says. He finds himself fortunate to have built what he calls the ‘dream team’.
“Our team has been through many ups and downs, and we have witnessed and supported one another’s growth throughout the years. As a result of our cohesive team, our unified vision, we can overcome any challenge and obstacle,” Pun says.
He thinks during a turnaround, it is important to have transparency, over communication and know each colleague’s expectation and goal. “I tend to give my colleagues a lot of responsibilities, room to grow and emphasize its ok to make calculated risk and fail,” Pun says.
According to him, the #3 aspects that need to be catered to while turning around a company include -
- Sound Strategy - After I bought the business, the first thing I did was to instil focus/discipline, make things simple and efficient and most importantly survive. One step backward, 2 steps forward strategy.
We exited our once largest markets US, Italy and the UK. Instead, we streamlined and retrenched back to Asia where I thought had massive opportunity to stabilize business, align cost structure. So we had to close our headquarters in US and relocate the headquarters and rebuild design, marketing functions from scratch back in Asia.
- Speed - Quick about stopping the bleeding, cost cutting.
- Passionate Staff - Who are empowered, have clear key performance indicators and have interest alignment
The next transformation for Evisu is to be a truly global lifestyle brand by re-entering the US and European markets, Pun tells Entrepreneur Asia Pacific.
With Evisu’s focus on Asia, Pun finds the cost of doing business or employee compensation a big plus as it is almost half against Europe. “Business environment, spending power, franchisee terms are all more favourable in Asia versus western markets’ transact-based on credit,” Pun says.
Product diversification and extension, from denims to kidswear, eyewear, shoes, underwear and leveraging existing relationships and networks for other brands who want to enter into Asia to be a retail distribution platform are on Pun’s mind for expansion.
For Pun, leadership to inspire teams to have a higher purpose and to execute and to turn an idea into reality, agility, the idea of always learning, striving to improve and not settling for less and grit, persistency and follow through are the 3 attributes that make a great leader.
Outside of the boardroom, David is a keen racer in motorsports and competes in the Asian Formula Renault Series. He is a member of the Young Presidents’ Organisation, the premier leadership organization of chief executives in the world.