(From Fashion News)
By Imelda Samaria
It’s already happened to middle-of-the-road stores across high streets and main streets. Now the world’s biggest luxury stores are starting to shutter outlets. The culprit is the Chinese consumer, who is starting to rein in spending at home and abroad. The effect will be no less severe: expect more closures to come.
Over the past decade, Chinese consumer demand and new store openings together turbo-charged luxury sales. New store space accounted for 55% of global luxury revenue growth over the past eight years, according to analysts at Mainfirst.
As for Chinese nationals, they powered about two-thirds of luxury market’s growth over the past decade, according to Exane BNP Paribas.
Now both of these forces are running out of steam. Given the slump in Hong Kong and the slowdown in China, stores there are the main focus of attention.
Gucci and Zegna were among luxury brands to cut their store footprint in the first quarter.
Hugo Boss has already announced plans to close 20 of the 131 stores it directly owns on the mainland. It’s reviewing as many as another 20 of its least-profitable 430 stores globally. Read more