According to an article on Yahoo Japan (via J-Cast), the Italian luxury fashion brand Versace has quietly withdrawn from the Japanese market. The article, currently available only in Japanese, says that Versace closed all four of their directly-managed Japanese stores between May and July of this year, and also announced plans to close the Versace Japan public relations office at the end of this month. According to the article, the combination of these actions mean that the brand has basically removed themselves from direct participation in the Japanese luxury goods market – without making any official statement about the move.
Contacted about the article, a Versace Japan spokesperson replied only, “There is nothing I can say at this stage, because it’s a policy from headquarters.”
Versace’s sales in 2008 in Japan were half of what they were in 2007, according to the article. Of course, Versace is hardly the only luxury brand having problems in Japan. The worldwide economic crisis has hit Chanel, Louis Vuitton, and other high end brands in Japan as well, resulting in declining sales and/or store closures. However, if Versace has really decided to pull out of the market completely, it could be a sign of more bad news to come for Japan’s fashion industry. Just today, the French Connection announced plans to close all of their stores in Japan.
Not all of the news in the article is bad for Versace. The author mentions that the brand opened 10 new stores in China in 2008. It’s possible that Versace, like many other brands, sees emerging markets like China and India as the future of luxury goods sales. There is also a statement from an unnamed “informed source” who says that they believe Versace has plans to open new stores in Japan after autumn 2010, so this may not be an exit from Japan, but rather a temporary closure. Time will tell.
The full article is available in Japanese here.
Update: Bloomberg has now confirmed this news and Versace has issued a statement saying they will review their “entire business strategy”. The new Bloomberg article is here.