Italic’s business model allows it to sell high-quality items at enormous discounts
Consumers looking for the perfect (affordable) gift for the upcoming holiday season may be in luck thanks to Italic, a new startup set to launch soon with $13 million in backing from notable investors including Global Founders Capital, Comcast Ventures, and others. The company acquires “unbranded luxury goods directly from the world’s best manufacturers,” dramatically cutting costs for customers.
How Italic Disrupts the Traditional Commerce Model
Jeremy Cai, the founder and CEO of Italic, grew up in manufacturing with his parents starting a manufacturing business in the eighties shortly after moving to the United States. This background gave him an early impression of some of the absurdities of the supply chain and the desire to “empower manufacturers to earn fair margins and to democratize access to quality goods.”
Italic has established partnerships with some of the world’s top factories that are known for supplying top-line goods to the biggest luxury brands in the world. Products available on Italic are the same quality as the ones sold by Gucci, Chanel, Burberry, Prada, and more, and used by luxury hotels including Four Seasons and Ritz Carlton — just without the branding.
Manufacturers are vetted by in-person inspections to assure quality working conditions and practices, sustainability, and correct certifications. By going straight to the consumer, manufacturers stand to make three to five times the profit they normally would working with brands. Using Italic’s software system, manufacturers can track their sales and access real-time data regarding their product rather than waiting to hear back from their corporate buyers. Aside from waiting to be approached by Italic, interested manufacturers can fill out an application and attach a catalog to be included.
Of course, the manufacturers aren’t the only ones to benefit from this business model. Consumers looking for luxury handbags, eyewear, bedding, and more, but willing to eschew branding can find incredible savings simply by avoiding the costs associated with marketing big brands.
Members can only buy two products per month due to limited supplies and Italic has already amassed more than 100,000 people on its waiting list before launching. Understandably so, with promises of such big savings and more products being added after launch. If the business model proves successful, this mark a significant a change in the supply chain and B2B and B2C marketing.
However, the question remains … how many are truly willing to forego the status symbols of brand names? Are people really spending big bucks for high quality products or are they buying items to impress their friends and neighbors? While these products are far from knock-offs sold on the street corner, they still lack the cachet that comes with the branding that connects them to products seen on runways and the red carpet.
Italic is betting that there are enough people who care more about quality than about brand recognition. So far, their impressive waiting list suggests they could be right.