Longchamp SAS, the French handbag maker that boosted sales 70 percent in China last year, sees growth slowing from that pace in the Asian nation as the economy expands at the weakest pace in three years.
Closely-held Longchamp, which is known for foldable Le Pliage nylon tote bags, expects sales in China to rise by “double-digits” this year and next with growth rates lower than 2011, Chief Executive Officer Jean Cassegrain said in an interview in Hong Kong yesterday, without providing a specific estimate.
The Paris-based company joins other global consumer businesses, including Burberry Group Plc (BRBY), in reporting slower growth in China, where a slump in exports and a contraction in manufacturing is forcing shoppers to cut back. The bagseller plans to add four to five shops in China next year, where it already has 14 stores, Cassegrain said.
“It’s great timing for us to grab the opportunities in China as some of our competitors may shy away from expanding when the economy slows down,” the executive said. “We believe China will continue to grow fast.”
The company plans to start selling its products online in China next year, he said.
Longchamp’s foldable Le Pliage nylon tote bag that sells for about HK$900 ($116) in Hong Kong has annual sales of more than 3 million units globally and was the company’s most popular item worldwide last year, the executive said. The company has sold a total of 20 million the Le Pliage tote bags worldwide since the product was introduced in 1993.
Longchamp had total global sales of 390 million euros ($507 million) last year, according to Cassegrain.
China’s economy expanded 7.6 percent in the three months through June from a year earlier, the weakest pace in three years.
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