Published on : Jun 03, 2015
Gucci, the French luxury brand label has recently started offering large discounts at its china stores, to follow similar moves carried by other companies in the country.
LAST week, Gucci offered merchandise such as shoes, purse, and garments for as much as half the price. Other luxury brand labels such as Chanel, Dior, Prada, Cartier, and Lancôme have skashed prices considerably in the market.
The price cuts from Gucci come as a consequence of poor sales last year, as commented by Ma Kailun who is a luxury goods consultant. The owner of the French brand, Kering SA, is slated to reduce inventory and bring in new line of products.
As per revenues for Gucci, it dropped by 1.8% last year from the previous year, as per financial report from Kering SA, even though h revenue from the other brands of the firms surged. The revenue from Saint Laurent, which merchandises clothing, cosmetics, and shoes grew by 27%.
Gucci also exhibited dropped profits in the first quarter of the year. The total profits dropped by 7.9% in comparison to the same period in the last year, whereas in the Asia Pacific profits dropped by 10%.
The discounts offered have received the attention of shoppers, as commented by an employee of a specialty store located in a premium shopping mall. He also commented, only few discounted items were available.
In the eastern cities of Nanjing and Shanghai, shoppers queued outside the stores so that they could reach for discounted goods, as reported by media.
One reason for luxury brands offering discounts wee that the government is cutting down import tax on consumer products, as added by Quennie Y, a fashion writer based in Shanghai.