In a decisive move to safeguard its ‘Made in Italy’ heritage, the Prada Group has terminated partnerships with 222 suppliers and subcontractors over the past five years. Finalized in late January 2026, this mass listing follows a rigorous audit cycle involving over 850 on-site inspections since 2020. The group’s internal audit teams utilized a ‘zero-tolerance’ framework, conducting unannounced overnight monitoring to detect unauthorized outsourcing and labor law violations. While the luxury sector often faces criticism for opaque supply chains, Prada’s recent disclosures indicate that over a quarter of their inspections resulted in immediate corrective actions or termination.
Strategic move towards vertical integration
Beyond ethical compliance, these terminations signal a broader consolidation of Prada’s production architecture. By pruning non-compliant entities, the group is intensifying its vertical integration strategy to mitigate reputational risk and ensure extreme quality control. This internal cleanup coincides with Prada’s recent 10 per cent equity investment in Rino Mastrotto Group, a key leather and textile provider, further securing their upstream value chain. Lorenzo Bertelli, Head-Social Responsibility, Prada, emphasized, while global transparency is evolving, the group’s ‘Qualified Vendor List’ now mandates 100 per cent adherence to new digital traceability protocols as a condition for contract renewal.
Financial resilience amid institutional reform
Prada’s aggressive supply chain discipline has not hindered its market performance. The group reported its 19th consecutive quarter of growth in late 2025, with nine-month retail sales increasing by 9 per cent to €3.65 billion. This financial cushion has allowed the firm to absorb the costs of shifting production away from high-risk subcontractors toward more transparent, long-term partners. As the luxury market navigates a complex ESG regulatory landscape in 2026, Prada’s proactive ‘audit-and-exit’ approach positions the brand as a leader in industrial accountability, effectively insulating its €250 billion target valuation aspirations from the legal and social fallout of labor exploitation.
A titan of Italian luxury, Prada Group operates brands including Prada, Miu Miu, and Church’s, specializing in leather goods, footwear, and ready-to-wear. Historically founded in 1913, the group now targets double-digit retail growth across Asia and the Americas, underpinned by a 9 per cent revenue rise in 2025.
