EMPORIO ARMANI store opens in Budapest amid growing crisis
One of the most affected economies in Central and Eastern Europe, Hungary has been struggling to keep its economy afloat with several loans from the EU Commission and IMF. Industrial output and exports are down and unemployment reaches 2 digits.
The Hungarian luxury market, mostly concentrated in the capital of Budapest has been hard hit, especially due to the decrease of foreign tourists, especially those from Asia which accounted for over half of all luxury sales. Gucci, Louis Vuitton and Burberry also opened in Budapest last year, before the crisis and were initially performing well. Mention should be made that Czech Republic, Hungary and Poland are part of the Anglo Saxon area of Central and Eastern Europe with a lower affinity for luxury branded products than all other countries. CPP Management Consultants Ltd estimated a recovery in the Hungarian luxury market will not be seen before mid 2010.
Unlike Gucci, Burberry and Louis Vuitton which entered the market with a direct investment, ARMANI have opened with a local franchisee. The EMPORIO ARMANI store at 9, Andrassy Ut opened last week in Budapest, together with an Emporio Armani Cafe, which is dubbed to become a hot spot for the trendy Hungarians.