Gucci discounts prompt lines as firm clears stock
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.