Prada to roll out new MidEast stores

Prada, the Italian fashion company that owns the Miu Miu and Church’s brands, plans to add 260 stores in the next three years to tap demand in emerging markets including Brazil, China and Arabian Gulf countries. “We are expanding in Morocco, Istanbul, Beirut, Dubai and Qatar,” CEO Patrizio Bertelli said in an interview with Bloomberg Television conducted in Italian via a translator. “Brazil is also a big market we’re looking at.” Demand for Prada’s leather goods and other items is increasing even as China’s economic growth slows and Europe’s debt crisis weighs on consumer spending, according to Bertelli. Chinese tourists are fueling growth in Europe, he said. Sales of discretionary goods in China will grow by a compounded annual rate of 13.4 percent between 2010 and 2020, as shoppers in the world’s second-largest economy become richer, McKinsey & Company said in a report in March. Chinese urban disposable income rose 14 percent to about RMB21,810 (US$3,450) in 2011. The so-called BRICs take their name from the emerging economies of Brazil, Russia, India and China. Prada expects the sales contribution of the Asia Pacific region to rise to 40 percent in 2012 and 2013, from 35 percent last year. The Milan-based company plans to open 12 to 15 new stores in China this year. “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. The euro has declined 11 percent against the dollar and 12 percent versus the yuan in the past year, and Bertelli said the company may consider increasing prices by as much as 10 percent in Europe if the single currency continues to depreciate. “We need to maintain the same value,” said Bertelli, the husband of Miuccia Prada, the designer of the brand. “We may compensate the currency adjustment by raising prices in Europe.” The 66-year old CEO also said the company plans to ramp up the presence of the Miu Miu brand as it is “underpenetrated” in many countries. Bertelli also shrugged off concerns that counterfeit goods could hurt the company’s sales in markets such as China. “We don’t want to be a brand that nobody wants to copy,” he said.