La Perla bets on Hong Kong
La Perla opened this week a new flagship store in Hong Kong on Russell Street, an area that once boasted the world’s most expensive retail space but has seen a string of store closures lately.
This is La Perla’s fourth store in Hong Kong. John Hooks, CEO of La Perla, said it has plans to open another three to five stores in Greater China in the next year or so. The now private-equity-owned brand has plans to bring its total store network from 215 to 230 globally in a year. The company has seen 30% annual sales growth in its stores, with growth in China a little faster at 35% to 40%.
Some even argue that as people become more careful about showing off luxury items in public, they are more willing to enjoy discreet luxury pleasure.
La Perla, which was bought two years ago by the Pacific Global Management Group owned by Italian entrepreneur Silvio Scaglia, is in the progress of revamping its products to include resort wear that can move from beaches to yachts to broaden its appeal.
Mr. Hooks said China’s slowdown has affected demand, but the impact has not been as acute as it has been on other luxury brands. Many brands have taken a hit due to Beijing’s anti-corruption campaign and the clampdown on lavish gift-giving; some luxury goods companies had also expanded too quickly in China, becoming overexposed.
“I don’t think there’s a consumer crisis in China; people will spend more money on luxury in the foreseeable future,” said Mr. Hooks. “The question is how they will spend the money. Hopefully we will have something they like; the problem is to have what they want.”
La Perla has seen a rise in Chinese travelers, even in locales such as Southern Italy and in smaller cities across the globe. The company recently opened a big new store in Seoul and will launch another in Tokyo early next year, partially to tap into demand among Chinese tourists abroad. “Chinese shop everywhere, thank God,” said Mr. Hooks.
adapted from WSJ