BizTrend: Brand name goods makers in Italy wary of Chinese buyers

Asian Economic News, Nov 29, 2004

MILAN, Nov. 26 Kyodo

(EDS: SECOND OF TWO SCOPE FEATURE STORIES ON BRAND NAME GOODS MAKERS IN ITALY) A Japanese buyer for a Tokyo-based department store recalled the day when a man who appeared to be Chinese approached him in front of a famous brand name goods store in Milan and said, ''Will you please stand in for me and do some shopping?''

The buyer said the number of Japanese experiencing similar encounters has been on the increase in the past few years because some stores restrict the amount of goods a Chinese customer can buy.

Milan is flooded with people from China, a nation attaining remarkable economic growth, and Russia, where wealthy persons are beginning to emerge. They all look for foreign brand names.

''They are really something in the way they spend their money,'' said the owner of one such store disdainfully. ''They buy one thing after another without even checking them.''

A man working for a Japanese trading firm in Milan said the city is full of people who buy brand name goods in great quantity to sell them for high prices in their home country.

Consequently, some stores have decided to limit sales of goods to people from certain countries, according to company sources.

The action has led some potential customers deprived of the chance to buy armfuls of goods to ask Japanese visitors to purchase things on their behalf.

A large number of Chinese media personnel were present during the Milan fashion collection event in late September.

Their presence was a topic of conversation, prompting a person related to the fashion world to say that only a few Chinese used to come until last year but the number now was no different from that from Japan.

Fashion designers are focusing on China and Russia for selling their upscale label brands at a time when markets in industrialized countries are beginning to become saturated.

Fratlli Prada made inroads into China last year and the Giorgio Armani group opened a large-sized store in Shanghai this year. The group plans to set up 30 stores in China by 2008.

However, there are no signs of abatement in the production of imitation goods in China due to a delay in the implementation of protection of intellectual property rights.

Jason Mitchell Jacobs, Prada financial communication manager, said Italian craftsmen are the only people who can handle the detailed processing of goods and leather, adding that all Prada goods are manufactured in Italy.

Brand name goods makers in China remain sharply alert in the sales and control of quality goods because their expansion strategy is fraught with the risk of losing the high-grade image of their goods.