Gucci dis­counts prompt lines as firm clears stock

China Daily (Canada) - - FRONT PAGE - By BLOOMBERG

Gucci is of­fer­ing dis­counts of as much as 50 per­cent in China as the Ital­ian fash­ion house seeks to clear out mer­chan­dise de­signed by its for­mer cre­ative direc­tor, prompt­ing lines of shop­pers to form since sun­rise.

The sales, which started on Wed­nes­day, are a nor­mal end of sea­son prac­tice and un­re­lated to China’s de­ci­sion to cut im­port taxes, a spokesman for Ker­ing SA’s big­gest brand said on Tues­day. A store as­sis­tant at a Gucci out­let in Shang­hai’s Pudong fi­nan­cial dis­trict, who asked not to be iden­ti­fied, said the sale lasts un­til next month, but wasn’t sure of the ex­act date.

Gucci Chief Ex­ec­u­tive Of­fi­cer Marco Biz­zarri is ac­cel­er­at­ing ef­forts to re­po­si­tion the maker of lo­goed hand­bags and $725 loafers amid fall­ing de­mand in Asia. Ear­lier this year, he pro­moted Alessan­dro Michele to cre­ative direc­tor, re­plac­ing Frida Gian­nini. The designer’s first full col­lec­tion will hit stores later this year.

“Biz­zarri is clear­ing in­ven­tory from the pre­vi­ous col­lec­tion, as Gucci is look­ing for­ward­to­turn­ingth­ep­a­geon Frida Gian­nini,” Lu­caSolca, an an­a­lyst at Ex­ane BNP Paribas, said. “Guc­ci­need­sanewdi­rec­tion and some cor­rec­tion — I con­sider this in­evitable.”

The dis­counts co­in­cide with China cut­ting im­port tar­iffs for some clothes, shoes and skin­care prod­uct by an av­er­age of more than 50 per­cent from June 1 in a bid to boost do­mes­tic con­sump­tion. They also fol­low moves by luxury com­pa­nies such as Chanel to re­duce prices in China be­cause of a weak­en­ing euro.

About 50 peo­ple were wait­ing in line out­side the Gucci store at the In­ter­na­tional Fi­nance Cen­tre’s shop­ping mall in Shang­hai be­fore the out­let opened at 10 am. At the head of the queue, Meng Ling­hao said he had been wait­ing since 6 am af­ter he heard about the dis­counts.

“The big sale here makes prices more or less in line with those in Hong Kong,” said the 26-year-old, who walked out of the store min­utes later with a 2,450 yuan ($395) Gucci wal­let.

The tim­ing of Wed­nes­day’s sale is “sim­i­lar to past years and there is no con­nec­tion with the re­cent de­ci­sion of the Min­istry of Fi­nance”, a Gucci spokesman said on Tues­day.

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