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    Luxury Brands Control Profits: Quickening The Pace Of Agency Recovery

    2010/8/21 10:06:00 40

    Luxury Brand Agency

    Not long ago, there was news that

    Hugo Boss

    We plan to set up a joint venture in China in the second half of this year and have signed an agreement. Hugo Boss will have a 60% stake in the joint venture.

    The analysis shows that the Chinese market is likely to become the third largest market in the world.

    However, the news has so far not been confirmed by Hugo Boss China.

    Before that, Burberry also said it plans to buy 50 franchises in 30 cities in China at a price of 70 million, which could boost its 2011-2012 operating profit by as much as 20 million pounds.

    Longchamp, a French handbag manufacturer, is also planning to acquire its Chinese distribution channel and has formed a Chinese team responsible for its administrative business.

    In addition, the US luxury brand PolobyRalphLauren also bought the right to distribute China from Disheng.


    In fact, these

    brand

    It was not the earliest water tester. As early as 2007, Armani set up a sole proprietorship company in China, and announced that it opened 50 direct outlets in China in 2008. In January 2008, MontBlanc announced the right to reclaim the Shanghai ruisin watch and clock company. After two months, the French Montagut returned the right of representation. The brand also set up a China headquarters in Guangzhou in 2007 and directly managed the mainland market. In May 2008, Coach announced the acquisition of Coach retail business in Hongkong, Macao and the mainland of China, which was represented by Junsi, Hongkong. In the same year, Dunhill, the internationally famous menswear brand, began to gradually recover the agency power in Wenzhou, Ningbo and Hangzhou.

    In addition, Gucci and other brand stores that have higher awareness in the domestic luxury market are all direct battalions.


      

    Luxury goods

    What kind of behavior is this "breaking the bridge"? According to the analyst analysis, there are two main reasons, one is the problem of the agent itself.

    Some experts said that due to the constraints of the agents' capital factors, they could not buy all the products of the brand category, which resulted in many incomplete merchandise categories of luxury brand shops.

    Secondly, the service of the agent has not reached the level required by the luxury brand, and in the process of expansion, there may be operation management, personnel level and brand development mismatch, which will be discredited to the brand image.

    The luxury brand is the most important brand image, in this case, only to turn to self, can ensure the expansion speed, but also can balance the relationship between high speed expansion and store management.


    Of course, in the eyes of more people, the potential market is the reason why luxury brands really regain the right of agency.

    According to relevant data, the growth rate of European luxury consumption in 2008 was only half that of 2007, which was affected by the international financial crisis.

    In the first quarter of last year, the total sales volume of French Gucci group decreased by 3.4% compared with the same period last year, while the consumption growth in the Greater China region was as high as 13%.

    Correspondingly, according to this year's Hurun fortune list, there are now 140 rich people with billions of assets in China and 1900 rich one billion yuan, with more than 55 thousand people who are worth more than 100 million yuan.

    The rich have an average of 3 cars and 4.4 watches, with an average annual consumption of 1 million 700 thousand yuan.


    The strong growth of China's luxury goods market and the contrast between the high-end consumption sectors in Europe and the United States have made it impossible for luxury brands to sit down and have to adjust their strategy in China, turn passively to take the initiative to cater to the trend of the global luxury market, and speed up the layout of China's luxury market.

    The withdrawal of agency power can not only control profits, but also have more voice.

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