Will luxury department stores like Bergdorf Goodman, Saks Fifth Avenue, and Neiman Marcus start showing up China?
There’s been talk of London-based Harrods’ plan to open its first store outside the United Kingdom in the historic Bund area.
Now, French luxury department store Galeries Lafayette announced plans to open its first store in China, in Beijing, by the end of 2014. It will be a 50/50 joint venture with Hong Kong-based fashion group I.T who will invest HK$150 million ($19.35 million) before opening.
There are plans for additional department stores in other major Chinese cities including Shanghai, Chengdu, and Shenzhen.
The century old Lafayette is well-known among wealthy Chinese who travel overseas to shop in its 10-story flagship Paris store. “The store is always full of Chinese tourists, and shop assistants are mostly Chinese,” said Bai Ling, a 26-year-old resident in Shenzhen who previously lived in Paris.
While Lafayette is eager to tap into China’s increasingly affluent consumer base and its partnership with I.T should help its China entry, there are challenges in choosing the right store locations and merchandising mix of brands suited to Chinese taste. “Lafayette’s (commercial venture) failed in Asian markets such as Japan and South Korea in the 1990s, and I.T has no experience running department stores,” said Yan Jun, president of Ecole Fashion and Luxury Consulting.
Lafayette has more than 60 department stores in France, Germany and Dubai.
photo credit: gleries lafayette