Prada Embarks on Ambitious Expansion Plan
Italian fashion brand label Prada SpA is about to embark on an ambitious expansion rollout in the next three years mainly to pursue the promising income from the BRICs (Brazil, Russia, India and China) as well as from countries in the Persian Gulf.
Undaunted by the rolling debt crisis hitting the eurozone and China's slowing controlled economy, the Italian luxury maker of ready-to-wear, leather accessories, shoes, luggage and hats for both men and women said it aims to add 260 shops through 2014.
"We aim to speed up expansion by opening 100 stores this year (and) 80 stores each in 2013 and 2014 globally," Patrizio Bertelli, Chief Executive Officer of Prada SpA, told Bloomberg Television.
The planned expansion will make the Italian brand's number of outlets increase to 674, of which 388 were directly owned and 26 franchised as of January this year. Last year, the company inaugurated 75 stores.
"We are expanding in Morocco, Istanbul, Beirut, Dubai and Qatar," Bertelli said. "Brazil is also a big market we're looking at."
Bertelli acknowledged the rising affluence of the market in the BRICs, particularly China, where in 2011, the urban disposable income grew by 14 per cent to $3,450. For this, Prada SpA has targeted to launch 12 to 15 new stores in China alone this year.
Quoting a March report by McKinsey & Co., Bloomberg News said China's purchases of optional goods will jump to an annual compounded rate of 13.4 per cent between 2010 and 2020.
Another is India.
"We currently do not have any shop in India, but we are looking to open a first store maybe in a luxury hotel in Mumbai or New Delhi soon," Bertelli said.
Overall, the Italian luxury fashion brand label Prada SpA expects sales from the Asia Pacific region will contribute 40 per cent to total sales in 2012 and 2013, from 35 per cent in 2011.