Zegna China Slows Sales

Ermenegildo Zegna, chief executive of the Milan based high-end men's wear retailer, said in an interview that China will continue to be a major market for annual revenue as new stores are opened and some franchised stores are converted into direct stores. Zegna opened its store in China in 1991. It is the first batch of foreign high-end brands to enter China.

Zegna said: "because local economic slowdown and increasingly fierce competition among high-end brands have led to a general decline in sales in China's first tier cities, but sales in second tier and three tier cities are still strong."

He said: "we have enough cash in the business and provide funding for the expansion plan, so we have no intention of going public."

In general, with the company's expansion plan, it accounts for half of Zegna's sales. Asia Pacific Region The annual revenue in the next 3 to 5 years will increase by at least 50%, including the opening of new stores in China. In addition, we plan to open 25% new stores on the basis of the current 150 stores in the Asia Pacific region in the next 3 years, most of which are in China.

China is Zegna Maximum sales market The brand has more than 70 outlets in the first tier cities of Beijing, Shanghai and Guangzhou, and also in Nanjing, Ji'nan and other second-tier cities. Driven by the rapid growth of the Asian market and the healthy growth of sales in the US and Europe, Zegna's revenue increased by 16% on the basis of 1 billion 100 million euros in 2010.

Zegna said that this year global sales will show "high single digit" growth, and European sales will be stable.

At present, Zegna has more than 560 stores in 87 countries and regions, of which there are 330 outlets.