Zegna: Integration Of Stores And Sales Outlets In China

Italy luxury group Zegna (Zegna) suffered heavy losses in 2014. Recently, the group is planning to reduce group capital expenditure in 2016.

In fact, exports still account for more than 90% of the company's total sales. Despite the decline in performance, China is still the largest market for Zegna, followed by the US market.

How will Zegna today respond to the Chinese market?

It is reported that Zegna CEO Gildo Zegna attaches great importance to the tightening effect of China and Russia's men's clothing market, and said: "we have taken measures to deal with it. We will continue to increase investment in direct chain stores and distributors in North America."

Facing the decline of passenger traffic in August, CEO thought it was mainly due to the decline of the RMB exchange rate and the turmoil brought about by the fluctuation of China's stock market.

However, CEO believes that sales will not decline in 2015.

In addition, in 2015, Zegna will make strategic promotion in cities such as Miami, New York, Osaka and Tokyo.

Act as

Zegna group entered the Chinese market as early as 1991 and opened its first shop in Beijing.

As the largest market in the group, sales in Greater China accounted for 1/3 of the total.

Although Zegna was also affected by China's economic slowdown and anti-corruption policies, sales in the Chinese region were higher than expected in the Past National Day holidays, while sales in other parts of the world also picked up.

This gives Zegna more confidence in 2016's performance.

According to Bloomberg,

The fourth generation CEO Gildo Zegna said: "last year, our capital expenditure was very high, and some very important investments were made.

This allows us to reduce some of our capital expenditure in the next year. "

Zegna has doubled the size of some stores in London and opened branches in Japan and Macao.

Zegna has yet to decide the extent of capital expenditure reduction, but CEO says it will be more cautious in 2016.

The group is currently working on

Integration of shops and sales outlets.

Due to the tight market in China and Russia, strong euro and extremely heavy tax burden, Zegna group said in 1 month that it had planned to consult with Swiss staff on salary issues, largely because the custom suits were made in Switzerland and indicated that some of the new costs might be passed on to consumers.

But it is worth mentioning that the plan will not increase the selling price in China.

"If we really want to adjust the price, we will reduce the price in China and increase the price of the European region," CEO said.

The biggest challenge facing Zegna now is the drop in traffic. CEO said: "there are fewer and fewer people in shopping centers and stores. You have to work out a reasonable plan to attract more customers."