Is Vietnam the new luxury hotspot?
Salvatore Ferragamo has just opened in the heart of Hanoï – Vietnam’s capital - with a store in the Tang Tien Plaza. The store marks the brand’s fifth opening in the country since 2006 when the Florence-based company first pioneered in what is one of the world’s most promising luxury markets.
Louis Vuitton counts three stores in the country - one in Hô Chi Minh and a two further locations in Hanoï - while Burberry has four and Gucci, two. Emernegildo Zegna opened its first point of sale in Hô Chi Minh last year and is planning for a second in Hanoi in just a few months’ time.
“All of these luxury brands with an established network of standalone stores keep their eye on global activity and are always the first to invest in new markets. After having carved the way, other brands will begin to flock to Vietman and we should see the number of luxury stores here double before 2015,” said Armando Branchini, vice-presidnet of Altagamma, a foundation that unites Italian luxury brands.
After the implementation of a huge reform in 1986, Vietnam experienced strong growth and, in the space of just a few years, the economy developed considerably. Growth in 2013 is forecast at 5.5%. “Over the past ten years especially, growth has risen significantly thanks to the number of large multinational companies have transferred production to from China to Vietnam - especially in the footwear sector – where labour costs are significantly lower. That in turn has caused an emergence of the middle class,” said Armando Branchini.
Vietnam is also major tourist location for wealthy Asians and Westerners alike and has seen a plethora of shopping centres and luxury hotels crop up over recent years. Unlike India and other emerging luxury markets, Vietnam also benefits from no customs barriers making it an attractive shopping location. Even brands mid-range brands are starting to tap into the country’s potential, with labels like Stefanel – which opened its first store here in 2012 - seeking out locations in Vietnam’s shopping centres.
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