SHANGHAI — Furla has just opened a new flagship in Shanghai and the Italian handbag brand is seeing strong sales growth in the country despite the economic slowdown, according to its executives.
In the first quarter of 2016, Furla’s China sales were up 60.6 percent, with like-for-like sales up 46.1 percent in local currency terms, said Furla Asia-Pacific chief executive officer Alessandro Bartoli.
Furla has actually benefited from the broader economic slowdown and President Xi Jinping’s corruption crackdown — factors that have hit higher-end luxury brands particularly hard, the executive said.
“Usually premium brands benefit from the middle class growing and trading up, passing through premium on their way to luxury brands. But we have also enjoyed a lot of trade down, so the women who can’t show off luxury brands because of the corruption crackdown, or are tired of the lack of exclusivity from big luxury brands, they want to try newer brands in the premium segment, but they can’t accept the horrible made in China quality of our competitors. Then the made in Italy craftsmanship and quality comes into play,” Bartoli said.
Furla’s new 3,230-square-foot flagship store makes its home on Shanghai’s famous Nanjing West Road shopping street. A cocktail party Thursday night drew Furla creative director Fabio Fusi, Chinese actress Jiang Shuying and more than 100 local media guests, including Vogue China editor Angelica Cheung.
By the end of 2016, Furla will have 56 stores in China — its current store count worldwide stands at 415 — and is planning continued expansion in the country, though executives said the point of sale growth will be of the slow and steady variety.
“We are planning to grow in a cautiously aggressive way, not too many stores, but enough to be accessible and well-distributed,” said Furla president Giovanna Furlanetto. “There is still wide potential to explore, there are many more Chinese people who will be able to afford premium products, so we are looking for quality expansion, rather than quantity, increasing the sales by square meter by enriching the range of products being offered in a more lifestyle direction.”
These new product categories — including men’s accessories, women’s wear and shoes — are already on display at the Shanghai flagship, and a major focus for Furla in the coming years will be to increase the size of their current stores to accommodate their growing number of products on offer.
According to Bartoli, the product expansion is going quite well, though he stressed that it would take time to grow in some competitive categories.
“The shoes category is not easy, because usually it belongs to specialists. The men’s section is difficult because the world of Furla has always been about women, but there isn’t really a premium brand doing 100 percent made in Italy accessories for men, so we are confident about that,” he said.