The Chinese Market Has No Dealership &Nbsp; The Era Of Luxury Pformation.

Another luxury brand has launched a large-scale startup mode in China.

In July 17th, Britain's largest

At present, Burberry has 50 franchise stores in 30 cities in the mainland.

According to its plan for the 2010-2011 fiscal year, Burberry will open 10 new stores in the financial year, all of which are direct battalions.

Before Burberry, Zegna (Ermenegildo Zegna),

Under the pressure of public opinion such as "breaking up the door" and "crossing the river and removing the bridge", agents' shouting "survival crisis" failed to change the major brands' luxury brands.

"Burberry is not willing to share profits with others."

19, a luxury goods agent said.

Last year, he was another agent of another international brand pformation camp.

Peaceful breakup

Kwok Hang Holdings is a senior brand agent in Hongkong. Its products include jewelry, clocks and watches, clothing and so on.

Burberry's chief financial officer, Stacey Cartwright, said on the phone that this was not an easy negotiation, and it took both parties a long time to find a consensus.

Shops and brands were originally owned by Kwok Hang Holdings and Burberry, so shops were the focus of negotiations.

Under the new cooperation agreement, Burberry will invest 70 million pounds in cash to purchase 50 stores and 85% shares of Kwok Hang Holdings in the mainland.

All pactions are expected to be completed in autumn.

In the future, Burberry will be fully responsible for the operation and management of the mainland stores.

"In the future, we will intensify our efforts to open stores and speed up the development of online shopping market.

Now the Chinese market is a good time to develop in depth. "

Burberry CEO Ahrendts explains Burberry's future in China.

Direct camp Era

The world's enthusiasm and expectations for China's luxury goods market are rising.

In May this year, the Chinese Academy of Social Sciences said that in the next 5 years, China's luxury market will be worth $14 billion 600 million, ranking first in the world.

Boston consulting firm expects that China will account for 29% of the global luxury market share in 5~7 years.

An international brand dealer said.

The consumption power of this market is constantly released, and the brand's final understanding of the market has come to an end. That's why so many brands want to kick off agents.

At present, brands such as Zegna, Armani, Rolfe rolun, MontBlanc, Tommy Hilfiger, which originally relied on agents to open up China channels, have begun to operate directly.

In this regard, MontBlanc and its agent, Credit Suisse's "break up" is particularly unpleasant, and the claims and disputes between the two sides have not yet been achieved.

Luxury brands often look for agents to open their way, and then recover their dealership after the market size is formed.

For Burberry, it is actively seeking partners in the India market and developing the market by way of franchising or joint venture. This is exactly the way Burberry first came to the Chinese market.

If the sales channel of agents is too strong, brand operators will gradually lose control and derive many grey areas.

Therefore, in every luxury brand Summit Forum, every brand is concerned about the control of agents.

"Another reason is profit," said the dealer. "The profits between brands and agents are proportionately shared. Since we have already opened the market for ourselves, why should we divide the bowl of soup into others?"

As of December 2009, in the 2009-2010 fiscal year, the revenue of Kwok Hang Holdings mainland China franchise was 75 million pounds, with a profit of 14 million pounds.

Cartwright did not disclose the profit sharing ratio. She emphasized that profits in China grow by two digits every year.