Located on the world-famous Rodeo Drive in Beverly Hills, California is Stefano Ricci, a 5,000-square-foot, high-end men's boutique where some of the world's richest shop for clothes.
Everything inside the luxury retailer — from the clothes and shoes to the furniture — is handmade in Italy and designed by owner Stefano Ricci himself, who describes his typical client as as an outdoorsy alpha-male who loves art.
A team of artisans and craftsman bring Ricci's designs to life, from the designer's $1,400 handmade silk shirts and $10,000 crocodile leather boots, to $53,000 diamond cuff links and even a $103,000 handmade crocodile coat with a mink collar.
Stefano Ricci two-piece suits start at just under $6,000 and can go up to $12,000, depending on the material.
The most popular selling item is a $2,800 crocodile belt; there's a $124,000, 18-karat-gold and diamond-encrusted belt buckle to with it for clients with even deeper pockets.
"Our average transaction is more than $4,000," company CEO (and Stefano's son) Niccolo Ricci tells CNBC. "The largest transaction we had was a year ago on one credit card. It was $450,000."
Though the company declined to provide CNBC any additional details about the six-figure transaction, Niccolo says it included "a lot of outfits."
Ricci, whose company is headquartered in Fiesole, Italy (just outside of Florence) and has dozens of locations around the world, has even had customers send their private planes to pick up clothes, he said in a recent interview.
Stefano Ricci's revenue in 2018 was 150 million euro (about $166 million) and sales were up 5% this summer compared to a year ago, according to director of communications Gianluca Tenti.
Over the years, Ricci's clothes have been worn by celebrities including Tom Cruise, Michael Buble, Andrea Bocelli and Nelson Mandela. In 2015, Ricci even presented a silk vestment to Pope Francis during a papal visit to Florence.
In fact, while CNBC was at Ricci's Beverly Hills boutique, 16-time Grammy-award-winning songwriter David Foster came in to shop.
"I'm here to buy a suit," Foster told CNBC. "And you know I'm gonna buy other things too, because that's just the way it is."
As Foster tried on an $8,900 sport jacket, he said he's been wearing Stefano Ricci for five years. He was introduced to the brand after meeting the Ricci family at one of Bocelli's charity events.
After 20 minutes of shopping, Foster's final tab for one suit, four handmade button-down shirts, three sport coats, two pairs of pants, one tie and one pocket square was $34,602.
"Nobody likes to spend money on anything really, but you get what you pay for," Foster said when asked about the boutique's prices.
"You know the only bonus to this? I get the miles on my American Express," Foster said.
In 1972, Ricci got his start designing and manufacturing men's neckties and selling them to international brands like Saks Fifth Avenue and Neiman Marcus. Demand became so great, he expanded his business to include cotton dress shirts.
It was on a trip to Shanghai decades later that Ricci decided he would open his first retail store in China. He reasoned that if everyone in China bought one of his ties for $1, he would have a billion dollars.
In 1993, Ricci opened the first Stefano Ricci boutique inside Shanghai's five-star Shangri-La hotel (now the Portman Ritz-Carlton). The decision was strategic: He knew the hotel would have a revolving door of well-to-do international clientele who could afford to spend $250 on a pleated necktie (that's the equivalent of about $440 today).
Today there are 69 Stefano Ricci retail boutiques worldwide and the brand is also at 20 department stores across the globe from Neiman Marcus to Harrods.
According to store policy, no item is ever sold at a discount. As a way to maintain exclusivity, whatever inventory is not sold is incinerated.
The company prefers to lose money than sell items at a discount, says Tenti. That's because if a customer buys a suit at one price and two weeks later it goes on sale, the sale price becomes the new price of the item in the customer's mind, says CEO Niccolo Ricci.
The company also claims a tax credit on the destroyed merchandise, according to a 2018 Wall Street Journal story. Tenti tells CNBC that according to Italian law, to write off the merchandise it must be destroyed (it can't be donated, for example).
Last year, Stefano Ricci destroyed around $2 million worth of unsaleable products, the company says.
Stefano Ricci is not the only brand that destroys unsold goods, but some, like Burberry, have discontinued the practice in recent years in the wake of criticism that the practice is wasteful and not environmentally friendly.
Christopher DiLella is a producer for CNBC's special projects unit.
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