KIKO Milano opened 29 US stores in five years — then closed 24 in a bankruptcy

KIKO S.p.A., Italy's largest cosmetics retailer owned by the Percassi Group, began its US expansion in 2013, opening stores in American shopping malls. By 2018, KIKO USA operated 29 domestic stores and one in Puerto Rico, selling affordable makeup positioned between luxury and mass-market cosmetics. The parent company operated approximately 1,000 stores across 21 countries.

The US expansion collided with the structural decline of American mall traffic. Physical-store sales fell faster than the company could adjust its cost base through lease negotiations. CEO Frank Furlan was directed to negotiate lower rents and early lease terminations, but only one landlord agreed to a buyout. High rents and operating costs produced continually depressed profits. In January 2018, KIKO USA filed for Chapter 11 bankruptcy in Delaware.

The restructuring plan closed 24 of 29 stores, retaining five in strategic locations — New York, Miami, Los Angeles and Las Vegas. The closures were expected to reduce annual operating losses by $7.1 million, though $3.9 million in real estate costs remained. E-commerce sales through KIKO's website and Amazon were growing in double digits, but not fast enough to offset the physical-store decline. Amazon already held 21.1% of the US beauty market, threatening even marketplace sellers with private-label competition.