Luxury Is Not The Worst In China, But Worse.

With the sharp drop in sales, luxury stores will continue to boom.

Most luxury brands will shut down some stores in China's two or three tier cities this year. Many luxury brands say they will suspend new stores in China this year.

For luxury goods, a store is a double-edged sword, which can open consumers' wallet and hurt themselves at high cost.

Compared to other brands, luxury brand stores are selected in downtown shopping centers and shopping centers, well known for their elegant sales and storefront decoration.

Now these have become a serious burden on the performance recession.

Luxury brands will also offer the banner of "optimizing the store structure" and continue to close their stores.

Recently, the US luxury brand COACH closes its queen's road central store in central Hongkong.

Almost at the same time, COACH returned to Tmall in a low-key manner, preparing for its second China electricity supplier tour.

The contrast between the two is that the former represents the dignity and glory of identity, while the latter is a hidden reef that luxury brands are reluctant to touch.

Better lose your money than lose face.

The electricity supplier is no longer a cheap, fake and Shanzhai gathering place. Instead, it penetrates into every capillaries of Commerce.

COACH is not the first brand to put down its image and feelings, and of course it is not the last one.

As early as 2008, COACH rented a shop in Queen's road, central, Hongkong.

At that time, the rental price was HK $2 million 600 thousand / year, and in 2012, when the rent was renewed, the rent was HK $5 million 600 thousand, plus the external wall advertisement up to HK $7 million 200 thousand, almost 3 times that of 2008.

However,

At the same time, the number of international luxury and luxury brands led by COACH has not risen correspondingly, and has been slowing down year by year.

By the end of June 27th, COACH's fourth quarter financial results showed that China's fiscal year sales for the first time showed a single digit growth, and sales growth in fiscal year 2015 was only 9%.

The corresponding sales growth in fiscal 2014 and fiscal year 2013 was 25% and 40% respectively.

This is also this time.

The direct fuse.

The lease scheduled for October 2017 was released 2 years ahead of schedule.

In an email sent to all members of Hongkong, the central flagship store was released in two years ahead of schedule, and was formally completed in August 31st.

"Although COACH has declared to the outside world that this is to optimize the structure of the store, the fundamental reason is that it is unable to make ends meet.

It is understood that in 2014, the year of luxury stores was the largest. Hugo Boss and Ferragamo closed 7 stores and 6 stores respectively, Zegna closed 6, and Burberry closed 4.

It is worth noting that in Burberry's latest earnings report, Burberry closed 10 stores in China, plans to shut down about 5 new businesses in the new fiscal year and slightly reduce the average sales area.

Gucci, Cartier, Dior and so on also reduce authorized authorized stores in China, instead of direct camp.