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Thursday, 8 October 2009
Versace to Close Its Japanese Stores
Gianni Versace will close its Japanese stores and review its entire business strategy, as demand for luxury goods declines in Japan, which has the world’s second-largest economy.
TOKYO — Gianni Versace will close its Japanese stores and review its entire business strategy, as demand for luxury goods declines in Japan, which has the world’s second-largest economy.
“The Versace boutiques in Japan no longer represented the brand image and it was felt to be more advantageous for the company to close them and start with a clean slate,” Federico Steiner, an outside spokesman for Versace in Milan, said Tuesday in a statement. The stores are being closed, he said in an interview. Versace has three stores in Japan, according to the company Web site.
Versace, which entered Japan in 1981, is the latest brand to scale back operations in the country, as falling wages and job losses chill consumer confidence. LVMH Moët Hennessy Louis Vuitton said in December that it had scrapped plans to open a 12- story store in Ginza, one of the busiest shopping districts in Tokyo.
Japan’s market for imported luxury clothes, bags and other goods fell 10 percent to ¥1.06 trillion, or $11.9 billion, last year from 2007, Yano Research Institute said in a report this year. The Tokyo-based researcher forecast the market would shrink to ¥992.7 billion this year, compared with its peak of ¥1.9 trillion in 1996.
Versace Japan had sales of ¥1.6 billion in 2008, compared with ¥4.1 billion four years ago, according to Teikoku Data Bank.
Versace’s chief executive, Gian Giacomo Ferraris, the former chief of the fashion house Jil Sander, took over in July after the departure of Giancarlo di Risio.
Mr. di Risio, who had run the brand for five years, left amid speculation about clashes over strategy with Donatella Versace, the company’s chief designer.
Under Mr. di Risio, Versace sold unprofitable units and took control of distribution in Japan and Taiwan to compete more effectively with Gucci Group and Giorgio Armani.
The company said last November that it expected Asia to surpass the United States as its biggest market after Europe this year as it expanded in China.
Mr. Steiner would not comment on a report by Nikkei English News that Versace would liquidate the Japanese unit by the end of the year, other than to say the company was “exploring its options.”
LVMH said in December that plans for its new store were derailed after it failed to reach an agreement with a developer in Japan.
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Versace to Close Its Japanese Stores
By BLOOMBERG NEWS
07 October 2009
TOKYO — Gianni Versace will close its Japanese stores and review its entire business strategy, as demand for luxury goods declines in Japan, which has the world’s second-largest economy.
“The Versace boutiques in Japan no longer represented the brand image and it was felt to be more advantageous for the company to close them and start with a clean slate,” Federico Steiner, an outside spokesman for Versace in Milan, said Tuesday in a statement. The stores are being closed, he said in an interview. Versace has three stores in Japan, according to the company Web site.
Versace, which entered Japan in 1981, is the latest brand to scale back operations in the country, as falling wages and job losses chill consumer confidence. LVMH Moët Hennessy Louis Vuitton said in December that it had scrapped plans to open a 12- story store in Ginza, one of the busiest shopping districts in Tokyo.
Japan’s market for imported luxury clothes, bags and other goods fell 10 percent to ¥1.06 trillion, or $11.9 billion, last year from 2007, Yano Research Institute said in a report this year. The Tokyo-based researcher forecast the market would shrink to ¥992.7 billion this year, compared with its peak of ¥1.9 trillion in 1996.
Versace Japan had sales of ¥1.6 billion in 2008, compared with ¥4.1 billion four years ago, according to Teikoku Data Bank.
Versace’s chief executive, Gian Giacomo Ferraris, the former chief of the fashion house Jil Sander, took over in July after the departure of Giancarlo di Risio.
Mr. di Risio, who had run the brand for five years, left amid speculation about clashes over strategy with Donatella Versace, the company’s chief designer.
Under Mr. di Risio, Versace sold unprofitable units and took control of distribution in Japan and Taiwan to compete more effectively with Gucci Group and Giorgio Armani.
The company said last November that it expected Asia to surpass the United States as its biggest market after Europe this year as it expanded in China.
Mr. Steiner would not comment on a report by Nikkei English News that Versace would liquidate the Japanese unit by the end of the year, other than to say the company was “exploring its options.”
LVMH said in December that plans for its new store were derailed after it failed to reach an agreement with a developer in Japan.
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