China’s central television recently drew online backlash for criticizing Starbucks for charging higher prices in its Beijing stores compared with those in other international cities such as London, Chicago, and Mumbai. This latest episode of public debate over a foreign company’s practices shows the complicated business environment foreign companies operating in China face today.
Recent luxury market trends have been reversed as a new report says the Americas will grow faster than China in 2013, but ironically some of this growth is being fuelled by Chinese tourists.
The Luxury Goods Worldwide Market Study from consultants Bain & Co indicated that the global luxury market would grow at 2% in 2013 to reach $299bn. The Americas were expected to increase twice as fast as the global luxury market in 2013, at 4%, while that in mainland China would achieve only 2.5%.
If you’re a retailer, there’s a good chance you’re one of the 96% impacted by Organized Retail Crime (ORC) in 2012.(1) ORC groups are professional shoplifters that steal large quantities of merchandise, usually with intent to resell for a large profit.
As the year-end holiday season approaches, retailers are faced with joy at the prospect of higher sales figures but also headwinds on the loss prevention front, as higher losses invariably accompany a spike in shopper traffic and goods sold.
Amid controversy and angst over foreign takeovers of well-known Italian companies, the head of Italian luxury textile maker Loro Piana has argued the case for selling a family business, in an interview with AFP.
Loro Piana, bought by French giant LVMH for EUR2 billion (USD2.7b), is now eyeing further global expansion, Pier Luigi Loro Piana, chairman and chief executive of the once family-run business, said.
The takeover was no act of betrayal and would help retain jobs as well as develop the company, he insisted.
Neverfull – the name of Louis Vuitton's best-selling handbag – sums up well its parent LVMH : even if it snapped up all of the world's last remaining independent luxury brands, it would still have room for more.
The French group's insatiable appetite for acquisitions has been tolerated by investors while its cash cow Louis Vuitton, which contributes half of group profit, grew revenues at a rate of more than 10 percent in the past two decades.
Luxury is all about the experience. This is the current trend that is taking over the Chinese luxury market.
Foundational to providing the "experience" is providing the other "E's", education and expertism. What is driving this push for experiential luxury? At its heart – and not unlike other wealthy consumers – wealthy Chinese consumers have a deep desire to become aficionados for a myriad of reasons, but largely for status, and companies are eager to satisfy that desire.
With much fanfare, European luxury houses such as Ferragamo, Louis Vuitton and Moncler are refurbishing and expanding their old retail spaces, jazzing them up to create a sense of novelty and give shoppers a new reason to pass through the doors. Others labels like Pucci and Fendi have relocated, opening a new store after closing a less prestigious address nearby. Most of the store bashes take place during Fashion Week, which ends Wednesday in Paris, while the industry's tastemakers are present.
Swiss luxury watch maker Raymond Weil sees India as its top 10 global markets in five years but plans to stay away from entering the country's single brand retail segment because of "complex" policies.
Raymond Weil has six franchise boutique showrooms in Delhi, Mumbai, Kolkata and Chennai. It also sells its products through 55 multi-brand retailers in the country.
Sales at luxury goods group Richemont rose 9 percent in the five months through August, just shy of forecasts, with weak demand for its watches in mainland China but strong growth in Japan and the Americas.
Richemont, maker of Cartier jewellery and Piaget watches, said its sales growth in the Asia-Pacific region, where it made 41 percent of sales in the full year to March, one of the highest exposures in the luxury goods industry, slowed to 4 percent from 12 percent a year ago.