Posted On 2014/07/03 By In Consumer, News, Luxury With 458 Views

Hugo Boss taking Control of China and Macao Stores

German fashion house Hugo Boss is taking full control of its store network in China and Macau as it seeks to improve the way its brand is presented, a move that mirrors a broader trend by luxury goods groups in emerging markets. Big brands have been opening more directly-operated stores, buying back franchises and taking stakes in retail partners in Asia, Russia and the Middle East to give them more control over store design and how their goods are marketed.

Luxury brands that have bought out their retail partners include Gucci, Hermes and Prada in Russia, Burberry in China and Japan and watchmaker Swatch in the Middle East. Hugo Boss said in a statement it was buying a 40 percent stake in its joint venture in China and Macau from franchise partner Rainbow Group but did not say how much it paid. The operations comprising 55 stores generated sales of 94 million euros ($128 million) in 2013, contributing to total sales in China of 211 million euros from 126 stores and concessions, about 9 percent of group sales.

“The consolidation of our distribution activities in China will further elevate the quality of brand presentation, increase productivity and contribute to the strength of our operational platform,” Chief Executive Claus-Dietrich Lahrs said.

Hugo Boss is seeking to run more of its own stores around the world instead of selling through partners and saw a 16 percent increase in own retail sales in the first quarter.


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Sources:

Article: Reuters / Image: Marc Falardeau

German fashion house Hugo Boss is taking full control of its store network in China and Macau as it seeks to improve the way its brand is presented, a move that mirrors a broader trend by luxury goods groups in emerging markets. Big brands have been opening more directly-operated stores, buying back franchises and taking stakes in retail partners in Asia, Russia and the Middle East to give them more control over store design and how their goods are marketed. Luxury brands that have bought out their retail partners include Gucci, Hermes and Prada in Russia, Burberry in China and Japan and watchmaker Swatch in the Middle East. Hugo Boss said in a statement it was buying a 40 percent stake in its joint venture in China and Macau from franchise partner Rainbow Group but did not say how much it paid. The operations comprising 55 stores generated sales of 94 million euros ($128 million) in 2013, contributing to total sales in China of 211 million euros from 126 stores and concessions, about 9 percent of group sales. "The consolidation of our distribution activities in China will further elevate the quality of brand presentation, increase productivity and contribute to the strength of our operational platform," Chief Executive Claus-Dietrich Lahrs said. Hugo Boss is seeking to run more of its own stores around the world instead of selling through partners and saw a 16 percent increase in own retail sales in the first quarter. Learn more in our Global Ready China Seminars Sources: Article: Reuters / Image: Marc Falardeau

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About

Stefan

Stefan (from Austria, Europe) has been living, studying and working in China since 2010. Stefan has worked on several research, publication and consulting projects focusing on the China Travel Market. He holds two Masters degrees and is an expert on China Outbound Tourism, Marketing and Social Media in China. Stefan works with BMG on the Global Ready China Seminars as well as the Global Ready China News and related projects. He also has teaching engagements in the areas of eMarketing and Tourism Strategy.

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