New Owner Mulling Options For China Expansion
Following Mohammed al-Fayed’s $2.2 billion sale of Harrods to the sovereign wealth fund Qatar Holding this weekend, rumors are swirling that the high-end retailer may be considering a Shanghai location to take advantage of China’s booming consumer retail market.
According to the Financial Times, expanding the Harrods franchise into overseas markets — where consumers are sufficiently far away to preclude a quick shopping trip to London (something that has stymied discussions on Paris or Madrid locations) — is just one idea so far put forth by Qatar Holding about how to revitalize the London institution. Also under consideration are a luxury online retail store and a London flagship makeover.
As the Independent writes today, the caution displayed by Harrods’ new owners about whether to branch into hot markets like China simply reflects a desire to directly control and manage brand perception in China:
Various luxury brands are currently pondering on how to expand to China without sacrificing the exclusive appeal of their houses. One to watch is French luxe label Hermès, which announced last month that it would open the first store of its newly established brand Shang Xia – “clothes and accessories based on Chinese styles and traditional know-how” – in Shanghai in September. Stores in Paris and the rest of the world are expected to follow.