Luxury Retailer Notes That Stabilized Sales, Huge Growth In Greater China Have Fueled Asia Expansion
Most global fashion houses have, over the years, worked hard to make something of a foothold in the Chinese market. As we’ve written before, one of the first major Western fashion companies to enter China following the “reform and opening” policy of the late 1970s was Pierre Cardin, who began selling in China in 1979. Since then, major fashion boutiques from around the world can be found in China’s largest cities, and some have progressed into smaller (but still large by most standards) second- and third-tier cities throughout the country. Despite major setbacks for some retailers in formerly reliable markets like Japan — where companies like French Connection and Versace have recently closed down operations — and a drop in demand in the American market (although that has, according to reports today, stabilized for many luxury companies), the surge in demand for certain designers in the Chinese mainland should soften the blow in revenue that these companies are experiencing as a result of the global economic downturn.
The Valentino Fashion Group — which includes the Valentino, Hugo Boss, and Marlboro labels, today announced that the company has benefitted from the quick rise in consumer demand throughout China. From Bloomberg:
Revenue in China and Hong Kong jumped 40 percent in the past month, and the company expects that pace to continue, Sassi said backstage after the show…
Although sales in Japan were described today by Valentino’s CEO as “not that bad,” the company’s major focus is store expansion in mainland China, Hong Kong, and Southeast Asian markets like Singapore:
[Valentino CEO Stefano Sassi] said the group is opening Valentino stores in Asia — Singapore, China and Japan. “These are not great times to open shops, but we are going ahead with what needs to be done.”