KUALA LUMPUR: “Leather is our passion”, said business development general manager of Bonia Corp Bhd Geoffroy de Drouas during a recent exclusive interview with The Edge Financial Daily at its headquarters here.

What started over 30 years ago as a humble leather goods wholesaler is today a local leather empire with a brand strong enough to win business overseas.

Bonia was founded in 1974 by executive chairman Chiang Sang Sem, who was at that time a leather goods wholesaler. Inspired by 16th century sculptor Giambologna on a trip to a leather trade fair in Bologna, Italy, Chiang registered the name “Bonia” in his tribute.

Since then, he has turned the business from a wholesaler to a leading fashion house renowned for its quality leather handbags, shoes and menswear. Its growing line of fashion accessories now includes perfumes.

Over the past four years, Bonia’s revenue grew at an average annual compounded rate of 13% a year from RM221.37 million in 2006 to RM360.1 million in 2010. Net profit growth was even stronger from RM13.83 million to RM33.55 million, reflecting a 24.8% compounded annual growth rate over the same four-year period.

Closing at RM1.68 last Friday, Bonia’s market capitalisation stood at RM338.64 million and is trading at eight times current year earnings, according to Bloomberg data.

Bonia built its name on quality leather goods, mostly calf hide, but also including nappa, ostrich and deer skin. Recently, the label relaunched a collection which used calf leather from Italy that were coloured using the more eco-friendly vegetable dyes.

In efforts to keep abreast with the ever evolving designs in fashion, Bonia Design Studio was registered in Italy last month.

“We have set up a design studio in Milan with a designer who is heading the team there. His name is Gaetano De Franceschi,” said de Drouas. De Franceschi helped Bonia create its 2010 Spring/Summer collection.

With an experienced designer at the forefront of the fashion wave, de Drouas foresees the brand entering into the European market in the not too distant future. “We plan to go through the Italian department stores, like Rinascente, and hopefully Galleries Lafayette in Paris,” he said.

Other foreign expansion plans include the Middle East, where Bonia wants to increase its presence. It already has operations in Syria, Oman and Saudi Arabia. Currently, the group is actively seeking a distributor in Dubai and from there, Bonia also plans to tackle the rest of the region.

“We really have strong potential in the Middle East for various reasons. First of all, a lot of people from the Middle East come to Malaysia and they are familiar with the brand. Then, Malaysia has a very good image in the Middle East,” de Drouas explained. The region’s current instability means it needs to be a tad patient in executing its expansion plans there.

When it comes to appointing a retailer or distributor, de Drouas said Bonia needs to be cautious in selecting the right partners to protect its branding.

“We are looking at people having experience with retail industry. This is essential. You don’t order shoes the same way you order spare parts. Retail is [very much about] detail,” he said.

On the home front, Bonia sales currently make up 75% of group revenue, up from 70% four years ago, as tourists in Malaysia lap up its offerings at its well-placed boutiques in Kuala Lumpur, Penang, Genting Highlands and the Kuala Lumpur International Airport.

“We have been receiving emails from expatriates who’ve moved to the region asking where the nearest Bonia boutique is,” De Drouas said, adding that a number of its loyal supporters prefer Bonia products to the more globally known names as they recognise a good product with the brand while others choose to be different from the brand-centric herd.

“I was in Galeries Lafayette (in Paris) when I saw a woman with this beautiful Bonia bag. I ran up to her to find out where she had got it from, and she said that she had got it in Malaysia,” De Drouas said of an experience he had with a customer, and the fact that the Bonia brand is gaining more international attention.

With new designs released every year, the Bonia label draws in crowds from a wide spectrum and is diversified enough to suit different tastes. One example is in men’s shirts.

“Before, we had shirts with no pockets. So, I said [to the team] look, in Malaysia if you want to sell, you need pockets. Not necessarily with the logo, but I say... [to] please everybody, have it with and without the logo.”

Bonia has also diversified its product range by creating a line of perfumes for men and women. The idea was introduced by De Drouas himself during a company meeting two years ago.

“Not because I’m French,” he joked, “but because I’ve been in this business before, I suggested we come up with fragrances to bring up the image [of Bonia]. It’s easy to manufacture, it’s easy to store, easy to sell. [It] doesn’t take much room, and it has at least three years shelf life.” The French-made perfumes might soon be airborne as Bonia is currently in discussions with Malaysia Airlines to sell them in-flight.

As for potential competition on the local scene, Bonia has been able to create a niche. Its core leather goods products face no local competition in Malaysia, and the Bonia brand has been extended to include menswear, accessories, perfumes and luggage sets. Late last year, the company  expanded its portfolio of brands and market reach by acquiring a 70% stake in Singapore-based Jeco Group.

Jeco is the licensee of Pierre Cardin’s leather goods in Singapore and the master licensee for Renoma in Singapore, Malaysia and Indonesia. It is also the sole distributor of Bruno Magli products in Singapore and the owner of the licence to the Braun Buffel brand in Asia Pacific.

Indeed, De Drouas is particularly excited about the German brand Braun Buffel being under the Bonia stable.

“Braun Buffel compliments Bonia well. It’s a similar industry. So, this is a business we understand, we can manage it,” said De Drouas. The acquisition of this licence helps Bonia strengthen its weak position in China where Braun Buffel is popular.

Sophisticated, classic and with attention to detail, Bonia has grown from its humble beginnings to a respected label. De Drouas said the company’s main objective is to consolidate the company within the next two years. With plans to board flights as well as enter into Europe, exciting times are ahead for Bonia.

This article appeared in The Edge Financial Daily, July 25, 2011.