Fauchon

Fauchon is a French gourmet food and delicatessen company that was founded in 1886 in Paris, France.[1] Fauchon is considered a major reference in contemporary French gourmet foods,[2] and it had 81 outlets in operation around the world as of 2019.[3]

History

Origins from 1886 until 1952

The founder of the Fauchon brand, Auguste Fauchon, was born in Ellon, Calvados, in 1856. He moved to Paris in 1880, where he began to work as a street vendor, moving on to become a wine and spirits merchant. In 1886, at the age of 30, he opened a fine foods outlet on Place de la Madeleine in the 8th arrondissement of Paris. The quality of the products made by Fauchon and its numerous approved suppliers[4]

From 1998 to 2003: wide expansion of activities

Laurent Adamowicz, a former investment banker and business school graduate[15] with experience in the field of luxury products, positioned the brand on the gourmet foods market. He launched new products[16][17] and ad campaigns, renovated points of sale, withdrew the brand from mass-market outlets and renovated the historical Tea Salon on Place de la Madeleine.[16] He started a new partnership with Air France, and promoted young pastry chefs, like Pierre Hermé, Sébastien Godard, Christophe Adam, Dominique Ansel.

In 2000, Fauchon became a growing and profitable company again, with 90 million Euros ($135 million) in sales and 5 million ($7.5 million) in EBIT for 2002.[18] Fauchon opened new stores in Japan, in South Korea, Taiwan, the Middle East, Europe, and finally in the United States[19][20][21][22] where it never had a store before, investing FF60 million (€9.2 million) in five years in the US market,[19][23] with a diversified investor group that included Michel Deroy and Jean-Francois Toulouse, former owners and managers of Dock de France supermarkets, the investment fund Matignon Investissements et Gestion, the publicly listed UK fund Intermediate Capital Group, and Barclays Capital Development France.[21][24] Barclays Private Equity France, a subsidiary of the Barclays plc Group, backed Laurent Adamowicz in his takeover of Fauchon to participate in its development in France and abroad.[25]

In France, the acquisition of Flo Prestige delicatessens for €39 million increased the number of outlets in Paris by 12 stores.[26] In 2003, the Fauchon network included 650 franchises, with 16 of its own shops, three in New York and 13 in Paris.[27][28]

The acquisition of the Flo outlets in Paris in 2002 and the opening of three shops in New York led to a sharp rise in income between 1998 and 2004, but a decline in Fauchon's net profits.[29] In the spring and summer of 2003, Fauchon, heavily in debt, was affected by the collapse of the tourism market with the combination of several events: the Iraq War and the fall of the Saddam Hussein regime in April 2003, followed in May 2003 with the severe acute respiratory syndrome (SARS) virus epidemic, and then the unprecedented heat wave in Europe that hit France particularly hard with over 15,000 dead in August 2003.

In January 2004, Laurent Adamowicz sold his interest in the company and left his CEO's office to Michel Ducros, one of the sons of Gilbert Ducros (1928–2007), the founder of the Ducros spice business.[30][31]

Since 2004

From 2004 onwards, Michel Ducros bought out most of the other shareholders, private and institutional, and will acquire between 2005 and 2009 all of the shares held by the Barclays Group, the 36% stake owned by La Compagnie du Bois sauvage, the stake held by Matignon Investissement & Gestion,[32] and lastly the minority shareholdings.[33] "I am an entrepreneur, I invest in the long term," he explained.[34][35]

In 2004, the new shareholders adopted a strategy that aimed to boost profits by selling off those assets they deemed to be non-strategic, closing stores in Russia and the United States,[36][37][38] selling their ready-prepared meal tray business to the Fleury Michon group,[39] and finally selling the Fauchon Paris stores to the company's rival Lenôtre.[40][41] Within the space of 6 years, Fauchon cut back its workforce by 700 employees, from 900 to 200 people.[42]

Michel Ducros revised Fauchon strategy with all its suppliers and set up a strict sourcing, to promote the French savoir-faire[43] and develop exclusive recipes.[44] Fauchon continues to produce most of its own breads, cakes, pastries and delicatessen products on its premises (in the Paris suburb of Courbevoie for cakes and pastries).

In 2013, after the departure of the CEO Isabelle Capron,[45] Michel Ducros appointed Eric Vincent as CEO, which announced ambitious plans for the company, aiming to have 100 outlets by 2017 (from 63 in 2013), mostly in franchises.[46]

Despite the lack of success in the United States and China in 2009,[47][48] Fauchon still aimed at international development on several big markets (Japan, Middle East, Asia and South America).[49] Fauchon had some 60 stores and restaurants around the world in 2013.[50] Fauchon reinforced its presence through Asia in Hong Kong in 2014[51] and Thailand,[52][53] and invested in North America,[54] and the Middle East, where new openings are concentrated.

On the verge of bankruptcy in 2004 (with losses of €30 million),[56] Fauchon made its way back to a smaller loss in 2009, and in 2013 posted an operating profit of €900,000 on sales of €50 million.[29] In Fauchon employed 270 people, operated 76 retail outlets and posted sales revenue of €180 million (including sales by franchises), 80% of which in international markets.[3][57] In June 2020, after many years of poor financial performance, Fauchon went into administration.

History

Origins from 1886 until 1952

From 1952 to 1998: exploring new opportunities

From 1998 to 2003: wide expansion of activities

Since 2004

2015: creation of Fauchon Hospitality

From 2018 to 2020: financial difficulties and closure of the historic store

2021: Kyoto hotel opening and resumption of activities

2022: Training school

Fauchon in figures

Competition

In popular culture

External links

References

founded	1886
founder	Auguste Fauchon
hq location city	Paris
hq location country	France