LensCrafters 2008 Annual Report Download - page 14

Luxottica produces and distributes sun and prescription eyewear of high technical and stylistic quality to
improve the well-being and satisfaction of its customers and at the same time create value for
shareholders, employees and the communities in which the Group operates.
Every collection, every pair of glasses, is the result of an ongoing process of research and development
whose aim is to anticipate and interpret the needs, desires and aspirations of consumers all over the world.
The achievement of high standards of quality reflects the Group’s world-class technical and manufacturing
know-how - the fruit of over 45 years of experience - and its constant commitment to technological
innovation, style and design, the study of changing lifestyles and interpretation of fashion trends.
Quality and customer satisfaction are also the objectives of the wholesale distribution network and the
retail chains. These structures are organized to offer high quality after-sales service, always and
everywhere, that is homogeneous but not standardized, being specially tailored to specific local needs.
Manufacturing excellence and the focus on service levels form just one of the strengths that Luxottica
leverages to achieve its main corporate objectives, which are shareholder remuneration, customer
satisfaction, the well-being of its employees and economic and social development wherever the Group
operates.
In general, the Company’s long-term strategy is to strengthen its global leadership and continue to grow
in all its businesses. Growth, whether organic or through acquisitions, is thus the main driver for creation
of value, thanks also to Luxottica’s unparalleled capacity to integrate and enhance the businesses it
acquires.
VERTICAL INTEGRATION
One of the competitive advantages underpinning the Group’s past and future successes is the vertically
integrated structure that Luxottica has built over the decades.
The Group’s present structure, covering the entire chain of value, is the result of a far-sighted choice made
by the Company’s founder and current chairman, who had understood the potential of the “vertical”
strategy ever since deciding to make entire frames rather than just components. Vertical integration of
manufacturing was gradually accompanied by expansion of distribution, first wholesale and, from 1995,
retail also, and without forgetting its key presence in the high value-added business of lens finishing.
In terms of manufacturing, the Company has, over decades, vertically integrated all the phases of the
production process to attain a level of efficiency in line with the quality of products and services it intends
to offer. Direct control of the entire production platform makes it possible to verify the quality of products
and processes, introduce innovations, discover synergies and new operating methods, and optimize times
and costs at the same time. The Group also has a centralized warehouse management and orders system
that processes data from the wholesale and retail structures to make demand projections and plan
production in advance, thereby reducing raw materials inventories and purchasing.
Direct control of distribution thus enables Luxottica to stay in touch with end users and understand their
tastes and tendencies, but it is also perceived as a strength by the stylists and fashion houses who come
to Luxottica to produce their eyewear collections and who are guaranteed genuinely global and capillary
distribution.
Further key synergies between production and retail distribution stem from assortment choices in stores,
which tend where possible to privilege Luxottica products and increase their degree of penetration far
more than is normally seen in business between manufacturers and independent retailers.
MISSION
AND STRATEGY
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