Burberry issue a profit warning for the luxury goods industry suffered cold

A few days ago, the British luxury goods retailer Burberry (Burberry) Group is unexpectedly issued a profit warning and announced same-store sales data is the worst since the financial crisis, show a slowdown in China and the euro zone turmoil luxury goods group impact, which raises concerns about the market for luxury goods industry.

Caused outlook Ltd. The expert of the luxury goods industry analysts said, Burberry's profit warning passing out a negative message to the most important, the decline in same store sales year-on-year growth rate of large area, from last year's 14% to 6% in the first quarter of this year, 0, to the latest quarterly market the second half of the year is likely to be negative growth.

It is reported that the Burberry released a profit warning, not only make it a 21% plunge in the stock Tuesday also make the entire luxury industry felt a cold snap. As of Tuesday, the LVMH (France LVMH Group) shares fell 4.5%, Ferragamo (Salvatore Ferragamo) fell 5.7%, Tod's (Tuo Desi) fell 4.1%, Richemont (Richemont, the Swiss watch manufacturer Group) fell 4.6% and even this year, the share price almost doubled Prada (Prada) also fell by 6.2%.

Morgan Stanley warned that there will be more of the luxury goods company came the bad news.

General decline in the growth rate of the luxury industry

Burberry had been born as early as 156 years ago, the brand loved by the King of England and world famous. So far, the classic Burberry plaid, the unique fabric features and generous and elegant tailoring, has become synonymous with British style.

However, Burberry Group was the first to issue a profit warning this year, the major luxury brands. After a few months, investors have been widely suspected the needs of this area is beginning to show a decline.

Burberry Group warned that the operating conditions in the second half of the year will be "more difficult": In the fiscal year ended March 31, 2013, pre-tax profit may be "in the low-end of market expectations, or between 407 million pounds to 455 million pounds.

Luxury goods industry expert said: "The decline in the luxury goods industry's growth there are a number of reasons. First, the debt crisis of the European market shrunk; Second, the slow growth in the U.S. market other luxury goods group take multi-brand, multi- category strategy, the relative decline in performance is not so dramatic like a single brand Burberry Group due to the lessons of the economic crisis in 2008, in recent years, the company's supply chain management efficiency has improved to the inventory pressure should not last so great. but, the recovery process of the future performance of the luxury goods company will slow global economic growth 'engine' China market continued high growth momentum is no longer. "

Industry or a period of adjustment

Investment Advisor in Senior Fellow Xuesheng Wen said, the luxury goods industry has been in China, "wind and water" recent first decline, accounting for a quarter of the global luxury consumption "buyers" and its slightly "powerless". Affected by domestic macroeconomic and consumer habits in China has gradually turned to the rational, which resulted in a greater impact on the luxury market. The Burberry shares tumbled, part of the influence of the Chinese market, but such a large decline, he is expected to include Asia, Europe, the United States and other major markets have different degrees of deterioration.

"" Invincible luxury goods industry is now entering a period of adjustment, which is the manifestation of normality of the laws of the market. "Xue Shengwen think the luxury goods industry in the global economic downturn troubled normality law of development of the market indicates that the economic rebound is revive the occasion.

Xuesheng Wen is expected that the market will usher in a new round of reshuffle, the crisis of affordability weak brand will be eliminated. The one hand, the luxury goods group seeking to lower production costs, on the other hand need research to understand consumer demand, production of marketable products.

However, in the current situation, luxury goods companies to accelerate the shop layout, and also be a burden. Burberry Group on Tuesday revealed that, so far, in the 10 weeks of the quarter, the decline in sales growth. Open at least a year's Burberry store sales were flat with the same period last year, despite coupled with the newly opened store sales growth of 6%.

The luxury goods industry experts said that in recent years, luxury consumption boom driven by the major luxury goods companies have in the Asia Pacific, in particular, is a second-tier cities in China to accelerate the shop, also played a role in fueling the blind development of the local commercial real estate, In the current economic situation, many of these new store openings can not achieve the desired results. Unlike foreign luxury goods consumers mainly constituted by the wealthy crowd of older and stable income, low age of the Chinese market, luxury consumers, more people are impulsive consumption and conspicuous consumption, revenue growth is expected to decline, will lead to high end of the contraction of the consumer.



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Burberry, Prada, LV, Tiffany and other luxury goods China revenue "zero growth"

 Core Tip: Recently, Burberry Group issued a statement, his name opened the store more than a year, an increase of zero sales in the third quarter of this year, the end of the 10 weeks ended September 8. Prada showed a profit, its market share in China is 25% lower than the high point in the past 12 months. Brands such as Louis Vuitton, Tiffany reported a market share in China's recent decline. According to the analysis, now these luxury brand sales growth in China has been suffering setbacks, and the slowdown in China's economic growth is closely related. The same time, more and more luxury consumer demand Mainland consumers online purchasing attracted.
Recently, the international luxury goods brand Burberry (Development site information) Group statement, its name opened the store more than a year, an increase of zero sales in the third quarter of this year, the end of the 10 weeks ended September 8, far below 6% same-store sales growth at the end of the second quarter ended June 30. Burberry shares crashed plunged 20 percent, the largest decline since its listing. A profit warning for its brand face, the Burberry Group Chief Financial Officer, said: "We are not only encountered in the past few weeks in the company of such experience."

A number of luxury goods listed companies released earnings data show brand sales growth in China, recently there has been a marked decline in the trend. The Burberry store revenue "zero growth" is really not the case.

Prada showed a profit, its market share in China is 25% lower than the high point in the past 12 months. Brands such as Louis Vuitton, Tiffany reported a market share in China's recent decline. Calculated in terms of sales, the world's largest jewelry retailer Chow Tai Fook reported in July, the second quarter of this year, turnover grew 16%, while the year-on-year increase of its fiscal year on revenue of up to 61%, this Mingsheng real drop performance, so the CTF H share price fell 8.7% the next day when the opening in the earnings announcement.

The economic slowdown is the main cause of

According to the analysis, now these luxury brand sales growth in China has been suffering setbacks, and the slowdown in China's economic growth is closely related. Chinese buyers purchase the amount of 1/4 of the world's luxury goods, the purchasing power of the current looks bloated.

Although the financial crisis that began in 2008 has made China's economic slowdown, but further intensify the implementation of monetary easing in 2009 while filling the gap between the rich and the poor in our country. It from the rapid growth of the luxury goods sales in China for three consecutive years is evident. Way of "playing chicken" economic stimulus eventually no match for the law of development of the economy, serious distortions when society as a whole redistribution of wealth, the underlying weakness consumption, excessive monetary liquidity and lead to the economic stagnation, and ultimately the economic bubble rupture, multi-party losses.

In this process, the economic conditions of the general public to improve the weak, and the wealth of the rich more massive shrunk even annihilation. Of Ordos, Wenzhou, Fujian underground usury collapse steel trading business Paolu, let the the original road gallop top luxury car have to fire-sale sale. When the pockets of the rich, let by itself is no guarantee they will buy luxury difficult for them to be excited.

According to the survey, in 2012, about 30% of China's richest purchase the luxury of spending will be reduced, the average annual salary of 16 million to 18 million middle class spending in this area is even more obvious. Miss Lee is a trade import and export company in Beijing middle management, previously purchased luxury brand handbags, watches and clothes for her is "business as usual" a few pieces of "brand", according to her words, not worn on the body, she was pretty. But this year, the results of her poor staff bonus halved her some down-hearted attitude toward luxury, "I have been more than six months have not bought luxury.

In addition, as China's economy slipped in August this year, China's fiscal revenue growth as low as 4.2%, the central fiscal revenue is a rare negative growth. This also forced our government will limit public spending to a certain extent. And coupled with China in June this year, the first time the introduction of public funds not be purchasing luxury Ordinance provisions will make gold, jewelry and high-end watches and other expensive luxury goods demand partially suppress.

Luxury online shopping segment the market

The decline in purchasing power to buy luxury goods in the store are too expensive, little discount, luxury consumer demand Mainland consumers are increasingly attracted to online purchasing. Internet to buy not only allows consumers tasted the sweetness of low price is also more convenient and easy way. Through online overseas purchasing, pay a fee or buy the necessary items, and has become an important way for Chinese consumers to buy international luxury agreement price.

In order to comply with the buying habits of consumers, many luxury brands have also begun to seize the Chinese online shopping market, and marketing through the network platform, expand markets, promote the brand. Armani took the lead in China to open up the e-commerce channels; thereafter, Louis Vuitton, Cartier and other luxury brands have opened the enterprise microblogging; Burberry brand customized on Baidu area and Baidu know the area; Dior fun online global advertising starting in China, has attracted more than 630,000 users access; inside the Apple AppStore can download Gucci, Valentino, Chanel, Tiffany and other brands of application software.

In addition, with the rapid development of China's e-commerce market, China's domestic luxury electric mushroomed emerging, more well-known of the share and network, still together, catwalks net, these are consumers of luxury goods in China The online shopping brings power.

Currently, online sales of luxury goods in China account for only about 5% of the total industry, but it's a very rapid growth. And this trend is on the one hand squeeze luxury goods sales in stores, on the other hand also more difficult to store sales growth of luxury entity.

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Burberry issued profit warning stock plunged 20% luxury plate comprehensive fell

The early morning of September 12 news, British fashion and luxury goods suppliers Pakistani Burberry (Development site information) Group asked the profit warning on Tuesday, and show the slowdown of economic growth in China as well as the development of the sovereign debt crisis in Europe has led to up to three years luxury The surge in demand situation coming to an end.

Known to lined Tuomao, red and black tartan trench coat Burberry Group was the first to make a similar profit warning major luxury brand. A few months before this, investors have been widely suspected the needs of this area is beginning to show a decline. Burberry Group raised this warning the same day, the share price has plunged more than 20%, the lowest level in 11 months. Including market value, including the world's largest luxury goods maker LVMH Moet Hennessy, the main competitors in Europe and the Americas, the stock had varying degrees fell.

Supplier of luxury goods, a strong rebound from the global financial crisis in 2008 to 2009 the performance but also because of the rapid growth of China and other emerging market countries make up the market in Europe and the United States and the global economic slowdown is maintained . However, with the slowdown in world economic growth, investors began to speculate that the luxury segment performance for how long to be able to maintain a high level of performance.

Burberry Group, in a statement Tuesday that the Group name opened the store for more than a year, zero increase in sales in the 10 weeks of the end of the end of September 8. This is much lower than the 6% same-store sales growth in the quarter ended as of June 30. Burberry Group subsequently warned that the company's full-year earnings expectations may be a position in the lowest end of the range of market forecasts.

Burberry Group did not specify the the performance growth area, but some analysts still believe that all the major markets, including Asia, Europe and the United States should have varying degrees of deterioration.

Subject to the Burberry shares tumbled, led by, the main competitors in France, Louis Vuitton and PPR shares fell more than 4%, the Swiss Richemont shares fell nearly 6%. U.S. luxury goods manufacturers have also been the the European peers adverse performance drag: jeweler TIFFANY fell 1.6 percent, Ralph Lauren was down 3.7% shortly after the opening bell.

However, analysts believe that the Burberry Group profit warning does not necessarily mean that the whole industry will encounter difficulties. Hermes International last month increased its annual sales expected, the smaller Italian brand Salvatore Ferragamo is also given to the satisfaction of the market sales data.



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London Fashion Week: Burberry Prorsum Goes Glam Metal Read more: http://www.rollingstone.com/music/blogs/thread-count/london-fashion-week-burberry-prorsum-goes-glam-metal-20120919#ixzz26y5YXwMn

Burberry Prorsum Spring 2013

Courtesy of Burberry

Designer Christopher Bailey is looking to Burberry's future through the glamour of its past and finding that it is very bright . . . and metallic, too. He ensured that his signature Prorsum collection – the heritage label's upscale line and seasonal piece de resistance of the London Fashion Week schedule – shone very literally for Spring 2013.

Entranced by old school "British glamour" and the excitement of space age materials, Bailey found a way to combine those elements at Kensington Garden's runway show this week. Like Marc Jacobs, he's not really in the mood for pants, it seems, with many of the show's looks focusing on metallic swimsuits or hot pants paired with (equally elemental) capelets – and, of course, Prorsum's signature trenches.

This season, those coats come in unabashedly feminine jewel tones like electric pink, emerald and amethyst, while the gleaming sateen dresses and fantastic plastic handbags continue the retro-gamine-from-the-future vibe. Corsets accented many of the key looks; burleseque darling Dita Von Teese, watching from the front row, was surely riveted.

Music is integral to any Burberry proceeding, and this season's soundtrack of Birdy, Ren Harvieu and Tom Odell – all recent additions to the brand's musical family – provided a meditative, soothing sonic contrast to all the wham-bam flash of the runway show. Burberry is at a pivotal stage in its 156-year history; it's one of Britain's oldest and most fondly observed sartorial institutions, yet under Bailey, it's a symbol of modern musical youth.  The English troubadours harkened to a rustic past, while the electric clothes on the runway indicated Bailey's head is lit up with dreams of a tech utopia, the kind 20th century optimists longed for but never actually created. Burberry's pop cultural plight has been a guitar-laden one, leading them through rock, punk, folk, and pop on the runways and at their intimate concerts. They might want to invest in electronica next if they want to stay ahead of the curve.

Tellingly, over on Regent Street, the new Burberry store is an innovative bastion of technophilic cool (with over 100 screens installed, it broadcast the Spring 2013 collection in real time). But Bailey will always have a soft spot, a certain reverence for the beauty and decadence of Britain's cinematic past. Through digital means, he aims to resurrect it. With his new collection, he's given the allure of the Vivien Leigh era a cyber-charged makeover.

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