LPP (company)

Clothing

Clothing is manufactured primarily in China, and to a lesser extent in India and Bangladesh and Poland. The design center for the Reserved, Cropp and Sinsay brands is located in Gdańsk, while the center for House and MOHITO is in Kraków.

LPP owns the largest and most modern clothing distribution centre in Central and Eastern Europe located in Pruszcz Gdański.

LPP clothing brands

Reserved

The oldest, flagship brand of LPP, with the first stores opened in 1999 in Poland. Since 2002, Reserved clothing has been available in the countries of Central and Eastern Europe, since 2014 also in Germany and Croatia, and since 2015 in the Middle East. The brand offers clothing for women, men and children, the latest models are delivered to the stores every day. Currently there are 461 Reserved stores.

Cropp

A youth brand, present on the market since 2004. Cropp clothing is visible mainly in clubs - where young people want to manifest their unique style and independence. Clothing and accessories of Cropp can now be purchased in 379 stores.

House

The brand joined the portfolio of LPP in 2009, following the acquisition of Artman. House clothing is addressed to young people whose source of inspiration and an integral part of life is music. Currently there are 330 House stores.

Mohito

Like House, it is a part of LPP since 2009, following the acquisition of Artman. Mohito designers create collections addressed to women who are confident, love fashion and combine comfort with elegance. Currently, the brand's clothing can be purchased at 290 salons.

Sinsay

Existing since 2012, the brand is addressed to young girls who follow the latest trends in fashion. The hallmark of Sinsay are t-shirts with bold patterns and prints. Currently there are 198 Sinsay stores.

Shareholders

The founders of LPP - Marek Piechocki (President of the Management Board of LPP) and Jerzy Lubianiec (Chairman of the Supervisory Board of LPP) - hold the so-called preference shares. As a result, together they have over 50% of votes at the General Meeting of Shareholders.

Listing on the Warsaw Stock Exchange

LPP SA has been listed on the Warsaw Stock Exchange since 2001. At the debut, the price per share was PLN 48. In 2014, LPP entered the WIG20 index, which brings together the 20 largest companies listed on the Warsaw Stock Exchange. In the same year, LPP entered the MSCI index. In 2016, the average value of one share of LPP was over PLN 5 000.

Company history

Control of the supply chain

LPP does not own any factories. The Group's clothing brands are mainly manufactured in Asia, but also in Poland and other European countries. The company has an establishment in Shanghai since 1997. The office's employees are responsible, among other things, for finding suppliers, supporting various production stages and quality control. In 2015, LPP launched a representative office in the capital of Bangladesh – Dhaka. The office started its operations in May, and persons employed there are responsible for coordinating and supervising the production of collections in local factories. An important task of our employees is also auditing the production facilities with which the company cooperates in terms of appropriate working conditions and observing human rights.

Disaster in Bangladesh

After the 2013 disaster at a clothing factory in Bangladesh (in which a building collapsed killing 1,129 workers), CroppTown tags were found in the ruins of the factory. Representatives of the company said that they do not control working conditions in places where they have production.

Agreement on the safe production

LPP SA was the first Polish clothing company in Poland acceding to the agreement (Accord on Fire and Building Safety in Bangladesh) aimed at improving safety in factories producing garments in Bangladesh. It is a pioneering agreement for clothing companies, and international and local NGOs, to ensure sustainable improvement in safety and working conditions.

The agreement consists of over 100 companies from the textile industry, mainly from Europe. For a five-year period there will be a series of remedial actions, ranging from independent monitoring of factories, and their modernization. During the program, LPP SA undertook to pay membership fees, which will provide the opportunity to conduct inspections and training of up to $2.5 million and incur other costs related to the improvement of safety in the factories.

Donation for the Rana Plaza victims and their families

The company gave a voluntary donation to the victims and families of victims of the disaster at the factory Rana Plaza.

Code of conduct

Regardless of accession to the agreement, LPP SA has committed to change its policy concerning cooperation with suppliers. The aim was to be able to exercise more effective control over the observance of its principles and the provisions of its Internal Code of Conduct which the company issued and implemented in 2014. The document takes into account the key provisions of the ILO conventions, the Universal Declaration of Human Rights as well as the recommendations of international civil society organisations monitoring working conditions in the garment industry. The Code contains guidelines for all foreign suppliers of LPP. The document describes their obligations in terms of employment, such as:

Verification of compliance with the provisions of the Code is a key element of LPP control activities. LPP reserves the right to conduct an unannounced audit of all factories with which cooperated.

Controversy over tax optimization

In January 2014, LPP SA's decision to move the brands to the subsidiaries in Cyprus and the United Arab Emirates sparked protests. Within days, 10,000 people joined a boycott page on Facebook initiated by Young Socialists to boycott products of LPP. Leaflets were planted in stores, accusing the company of tax evasion in Poland. The controversy caused the removal of the Facebook campaign page at the request of lawyers LPP, due to copyright infringement.

In February 2015 the company launched a process aimed at the transfer of trademark rights to the Polish company LPP SA. The reason for the liquidation of a company controlled by LPP in the United Arab Emirates, as well as the inclusion of the Cypriot company in Gdańsk company LPP SA, is change in the company's development strategy. In result, LPP SA will become the sole owner of the trademark rights to RESERVED, Cropp, House, MOHITO, SiNSAY and the know-how developed over the years. More than 90% of the profits generated by LPP SA Capital Group will be taxed in Poland, in accordance with the provisions of the Tax Code, whereas the remaining part will be taxed in other countries in which operate showrooms of LPP.