Profile: The Red who put Westwood in the pink

It took an Italian ex-communist to turn the high priestess of punk haute couture into a capitalist success, says Hilary Clarke

For a man busy building a global fashion company, Carlo D'Amario has some rather unconventional views. He finds Karl Marx more relevant than Adam Smith, describes the business he is in as being like "a game of Russian roulette", and says the thing that makes him most angry is to see clothing manufacturers using cheap, Third World labour. But then, who else would you expect fashion designer Vivienne Westwood, punk stylist turned haute couturier, to choose as a business partner?

Marxist economics eventually bankrupted the countries that took it at its word, but D'Amario's version is doing wonders for the woman whose "Pink Gordon" range of tartan bondage gear shocked the nation 20 years ago.

In the three years since D'Amario, 52, came to London from Milan to join Westwood full-time, her annual turnover has increased from "a few hundred thousand pounds" to pounds 20m. That's loose change compared to the Ffr1.26bn (pounds 130m) profit made last year by French fashion house Christian Dior, but it's a rate of growth any businessman would be proud of.

"He's not the easiest person to work with, but he has incredible vision," says one employee of D'Amario. Like his partner (Westwood has 70 per cent of the company, D'Amario 30) D'Amario is also slightly eccentric. Prolific hand movements adorn his speech - nothing unusual for an Italian - but he occasionally slips in a Japanese bow. He has a slightly dishevelled look, even though his grey hair is closely cropped and he wears Vivienne Westwood clothes.

D'Amario's career could have been very different. As a teenager he was picked by the Italian Communist Party to go to Lumumba University in Moscow, the former Soviet Union's international training centre for party cadres, "not to study but to make me a secretary general!" he jokes. His family's financial problems cut short his revolutionary career and on mama's orders he returned to Italy after six months with instructions to find a job. He landed one with Fiorucci, the Italian fashion house which, as D'Amario proudly states, was the first European company to sell jeans to America.

After seven years at Fiorucci, D'Amario set up on his own as a fabric buyer, a job that took him around the world, especially to Afghanistan, home of some of the world's finest textiles. Ironically, for a former prodigy of the Italian Communist party, the Soviet occupation in December 1979 forced D'Amario back to Milan.

He first met Westwood at a Paris fashion show in 1985. At that time he was running his own public relations company, Casanova. It must have been love at first sight with Westwood, because her financial prospects weren't too rosy at the time. "When I met Vivienne Westwood I thought she was a multi-millionaire because in some ways she was more famous in 1985 than she is now. I was very shocked when she said how little money they made. Luckily she seduced me."

For 10 years D'Amario "took care of Westwood's image in Italy". At that time the company had no production facilities; it was a purely creative phenomenon. Today all the clothes are made in Italy, except the Gold Label range, which is sewn in the UK. "It's like our wing gallery. It's the mother of everything," says D'Amario.

Vivienne Westwood is sometimes dubbed England's alternative Queen Mum, but the company she and D'Amario are creating reflects her staunchly pro- European, pro-federalist views. The creative team - mainly British - is overseen by Vivienne and Andreas Kronthaler, her Austrian husband; the sales and marketing manager is half French, and there are several other Italians. "We make the best salesmen," says D'Amario. The pattern cutters are German: "They are good on the technical side of things."

The first thing D'Amario did when he arrived in London was to persuade Westwood, who still lives in a council flat in Clapham, to buy some property in the West End. The value of the house the company bought as a shop and showroom in Mayfair's Conduit Street has already jumped by pounds 3.5m, excluding the money spent refurbishing it.

Under D'Amario's supervision Westwood has also been branching out abroad, and her clothes can now be found in 30 countries. A major coup was the partnership struck with Itochu, the Japanese trading company which oversees distribution in Japan and has the master licence of Vivienne Westwood that allows it to open shops and manufacture accessories.

When D'Amario made the initial, exploratory phone call he hit the jackpot. The Japanese manager he spoke to had been a punk sympathiser in his youth and knew Westwood. Now Japan accounts for one third of the company's exports.

Next year Vivienne Westwood plans to launch a cheaper sportswear range, Anglomania, alongside her Gold Label demi-couture, Red Label ready-to- wear and menswear ranges. The company is also bringing out a Vivienne Westwood fragrance. Bottles carrying the instantly recognisable "gold orb" Westwood logo will be stacked on the shelves of duty-free shops alongside perfume by Yves St Laurent and Armani.

Is Westwood, who accepted her OBE wearing no knickers, and is considered something of an intellectual dilettante, about to sell out? "Vivienne did punk in the 1970s and haute couture in the 1990s, but she has the same enemy and that is the system," says D'Amario.

By "the system" he means the huge European fashion conglomerates such as LVMH, France's handbags-to-champagne giant, which can afford to spend pounds 1m on one fashion set. The other "enemies" are the aggressive American companies such as Calvin Klein and Donna Karan.

The established European couturiers are adversaries to the Westwood/D'Amario ideal because they "cut creativity out at the roots", says D'Amario. By this he means they buy in talent, who then design to corporate order. "The young people are not given any time to grow themselves. This is very dangerous for creativity."

The American companies are an even bigger threat to the European fashion industry, D'Amario believes, because they attack the continent's sense of self by promoting simple, practical clothes, which D'Amario describes as minimalist fashion as opposed to detailed, sensual European couture. "There is a big war between Europe and America. America wants to teach Europe how to live in terms of fashion. It's a Calvinist versus Catholic thing. I'm not saying who is right, but American clothes are far too easy to copy in the Far East," says D'Amario. The bottom line, he says, is the erosion of European jobs in the industry.

D'Amario's counter-attack is a two-pronged strategy. First, safeguard your own intellectual property. This means controlling the company's image by keeping a tight control over the people to whom you grant manufacturing and retail licences, telling them where they can and cannot sell Westwood products, including her accessory range. "Identity is not something you eat. It's a business. It's a stock exchange thing."

The Anglomania casual wear line is part of this strategy. "A lot of people copy us, so it's better that we copy ourselves." The collection includes some of Westwood's earliest designs, such as the 1979 "pirate" collection. Most of the new designs are inspired by the company's archives of more than 15,000 pieces of clothing, and they give credence to D'Amario's claim that Westwood clothes are classics.

The second prong of D'Amario's strategy is investment in people. Vivienne Westwood is essentially a young company - the average age of the 95-strong staff is 26.

D'Amario believes in an old-style apprenticeship with the aim of providing a job for life, something he says he learned at Fiorucci and to which the other fashion companies no longer adhere. "I spend 95 per cent of my time looking for people for the team," he says. D'Amario plans an employees' stock option scheme as another incentive. "We want the people to stay with us all their lives. You can't just buy people in. I don't believe in mercenaries. I believe in the People's Army."

Later, the company may think about joining other fashion houses like Versace and Armani in going public, but even then D'Amario would only consider floating the shop and the distribution business.

D'Amario might now live in Belgravia (he is married to one of Westwood's former press officers, a Brazilian, and has a two-year-old daughter) but he still recommends Marx's Das Kapital as essential reading for the businessman. "It analyses the system, tells you how to create a structure and then runs that structure. That is all you need to know."

His philosophical sympathies might prove useful in other ways. Two years ago D'Amario was in Peking. A Chinese official surprised him when he said he knew Vivienne Westwood and that the government might be interested in opening a boutique in Peking. "I asked why. He said it was because they wanted to teach the people what is good and what is bad. He said they didn't want any old rubbish from Western countries. That was the best compliment possible. We don't want to be another Benetton."

With D'Amario and Westwood in charge, there seems little chance of that.