Loewe and Celine - made in China!!!!

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  1. Brands battle for accessible luxury
    LVMH challenges Coach in affordable category with made-in-China products

    Nikkei Net Interactive - Member Login

    :wtf: I never knew that even Loewe and Celine are made in China!!!

    As a side note, I think it's kind of interesting to see that these marketers in Japan rates Fendi as being 'higher end' than Louis Vuitton!! :shame:
  2. For Loewe their signature bag is made in Italy. For those seasonal designs some of them are made in china.
  3. I have known that Celine and Loewe are made in China but only the cloth bag not the leather one, Right?

    That's why Celine and Loewe are out of my eyes.

    Why I have to pay those extra $$$$$$$$$$ for a bag that pay a tiny $$ for their production.

    Anyway, most of products now are made in China including ipod and sony laptop. That's why everytime I bought the stuffs I always see MADE IN ..... first.
  4. Can not read the article because I am not a Nikkei.net member... how do i sign up?
  5. All the canvas bags are now made in China. For Celine, I also noticed those that are not 100% leather also tend to be made in China.

    Personally, my only objection is the amount of $s they charge for what costs them significantly less to make.
  6. Agree. Only the $ of the costs will prevent me from buying those bags.

    While there are fakes, China is traditionally renowned for the incredible craftsmanship in many areas. We can not forget that fact just because of some people's illegal business by selling fakes. After all, while boasting its crafsmanship in handmade leather goods, Italy is also flooded with fakes made in Italy and other European countries.

  7. Well, the rating still can not prevent LV from being the most popular luxury handbag brand in Japan. I believe LV, Gucci, and Coach have very good sales record there. I am kind of have a feeling that since LV is sooo common on the streets, it makes the brand feel like being "lower end".

    Anyway, Marketers talk for their own benefits:graucho: If the Japanese marketers use made-in-China as the sole reason to rank brands, that is too prejudiced.
  8. Cannot read this article as I cannot login, and do not wish to subscribe.
  9. I have noticed that over time, Elux has stopped listing the country of origin on a lot of the bags they sell unless it's made in Italy or France. I get the feeling that the folks at Elux don't consider "Made in China" to be selling point.
  10. i agree:yes:

  11. I wish I could access the article..

    Anyway, with regards to Celine, they started making some bags in China a few years ago, but so far it's only for some of their lower-priced cloth bags, which I'm not interested in anyway. It doesn't really change my perspective on the prestige of the brand in general - there are different levels within the brand I think.
  12. For those of you who can't read the original article..
    Brands battle for accessible luxury
    LVMH challenges Coach in affordable category with made-in-China products
    Staff writer

    [​IMG] Enlargement
    Accessible luxury is the catch phrase for the affordably priced foreign brands piquing consumer interest these days. Goods going for less than 70,000 yen ($670) are the hottest sellers, and the lead is currently held by U.S. leather goods firm Coach Inc.
    With LVMH, Louis Vuitton Moet Hennessy SA of France, countering with made-in-China products, the battle of the brands is brewing. And marketers have their eyes on the so-called "petite celebrity," women in their 20s and 30s who can comfortably afford expensive goods.
    A new series of handbags designed for young women has been gracing store shelves of Spain's Loewe SA and France's Celine - both under LVMH Group. Loewe's Pockets and Celine's Lily handbags have been in stores since late last year and will be featured through the spring.
    Most handbags from Loewe and Celine are made of leather and priced above 100,000 yen, but the new bags retail for an affordable 60,000 yen to 70,000 yen. New bags from both brands are made of fabric that includes their respective logos.
    "The market for goods in the medium price range is huge," Fabien Debaecker, Loewe's president and chief executive officer, said during a February visit to Japan. Celine's President and CEO Jean Marc Loubier agreed, adding that his company's strategy for new products is to expand their target market to include buyers of moderately priced goods. Loubier's comments are tantamount to a silent declaration of war for the "accessible luxury" market.
    The secret behind the brands' affordability is that the goods are made in China. The material is all European-made and most bags are produced in China. This is the first time for Loewe, once known as the brand that catered to Spanish royalty, with production centered in Spain and Italy, to produce in China.
    Celine also had its production hub in Italy. But launching the Macadam and Jacquard C Blason lines took some of Celine's production into China. The LVMH line usually features brands made in Europe. In Loewe's case, department-store buyers are complaining that Chinese production threatens to undermine the brand's reputation for craftsmanship.
    However, Debaecker insists that the quality of these products is "120%" Loewe, indistinguishable from that of goods made in Spain. Before Celine moved part of its production to China, it conducted a survey among Japanese consumers. The survey results confirmed that Chinese production would not subvert the brand's image.
    Executives from both companies have visited the company's factories in China to confirm the quality of the craftsmanship. They are confident about the finished products. The Lily handbags, for instance, even carry a large gold-plated plaque inside that is engraved, "Handcrafted in China." This is a sign of confidence as well as an indication that LVMH is serious about its policy of affordable merchandising. Loewe's recent announcement of new products featured leather bags made in China.
    [​IMG]A Coach outlet with a classy interior in Nagoya features affordable bags priced at 40,000 yen to 50,000 yen.

    At Isetan department store's Shinjuku flagship store in Tokyo, the affordable Lilys and Macadams are steady sellers. Celine's sales during March and April rose 30% from the same period a year ago. "Whole groups of customers who never used to shop with us are showing up," said Loewe's Debaecker.
    Some say LVMH's struggle in the Japanese market and Coach's success producing affordable goods in China are behind LVMH's recent foray into Chinese production. In 2004, LVMH's clothes and leather-goods sales declined 2% from a year earlier.
    But even in the case of Louis Vuitton, which rings up an annual 150 billion yen in sales, some department stores are reporting a drop in sales compared with a year earlier.
    "We have no intention of becoming like Coach," said Debaecker. "Japanese consumers have matured. In this day and age, consumers are free to go back and forth between expensive and affordable brands."
    But it is clear that these brands are fighting for the very same market. If LVMH has made a bad guess anywhere, it would be in expecting a weaker euro.
    Until about four or five years ago, Louis Vuitton was the affordable high-quality brand. The Monogram line, designed with the letters L and V, cost 70,000 yen. Some bags were even priced below 50,000 yen.
    Unlike the Hermes International brand, whose Kelly bag retails for more than 500,000 yen, Louis Vuitton was a brand even a student could afford with a little hard work.
    But Louis Vuitton's Japanese prices are constantly adjusted so that they are 40% higher than in France. The euro's strength has pushed up prices for Louis Vuitton's Sologne and Alma bags, which used to be below 70,000 yen, to more than 100,000 yen. Some wallets are priced above 50,000 yen. On the other hand, Coach's bags are mainly 40,000 yen to 50,000 yen.
    One department-store source said shoppers who no longer can afford Louis Vuitton goods are shopping at Coach. Some sources said Louis Vuitton's approach to branding may be two-pronged: while trying to reconnect with lost customers via its made-in-China goods, it may also be aiming to become more exclusive, like Hermes. LVMH is in the throes of a new corporate strategy.
  13. interesting article! thanks for the read! hehe.

    i really think that it's a half and half thing, it would be interesting to see how the made in China will fare world-wide, esp. with recent news regulation wise in China.
  14. Thank you for posting the article.
    Chinese workmanship won't drive me away from cute brands - but i'm definitely inspecting workmanship more closely on the bags I buy.
  15. This is very timely, as just two days agao I notice that a LEATHER Celine Bittersweet bag I purchased from Neiman's online indicates MADE IN CHINA. The original price was $990! I was completely shocked, so had to do research on it.

    Here's another article from the Wall STreet Journal, Sept. 27, 2005:

    WSJ.com - Login

    Foreign Luxuries
    Breaking a Taboo, High Fashion
    Starts Making Goods Overseas

    Euro's Rise, Low-Cost Rivals,
    Labor Costs Spur Gamble;
    Not Always 'Made in Italy'
    Egyptians Suit Valentino
    By ALESSANDRA GALLONI in Cairo, Egypt, CECILIE ROHWEDDER in London and TERI AGINS in New York
    Staff Reporters of THE WALL STREET JOURNAL
    September 27, 2005

    A desert wind blows through the open windows of a factory in Cairo that harbors one of the biggest secrets in Italian high fashion: Egyptian tailors.
    Women in head-scarves stitch shoulder seams, press wrinkles out of silk-lined pockets and weave Italian fabric through digital sewing machines. They're making $1,300 men's suits for Valentino, one of the most storied names in Italian luxury. They learned the craft from videotapes on TV sets positioned around the factory floor.
    For years, European luxury-goods firms manufactured T-shirts and jeans in Eastern Europe and North Africa, but drew the line at their fanciest collections, which commanded premium prices precisely because they were "Made in Italy." Now, pushed by rising labor costs, currency fluctuations and competition from low-price brands, Valentino and other firms in Italy and France are breaking one of the strictest taboos in high fashion: they're starting to produce some of their most exclusive lines in developing countries.
    Celine, a unit of luxury goods giant LVMH Moët Hennessy Louis Vuitton SA, is manufacturing some handbags in China, including its denim-and-leather Macadam bags, which sell for $500, according to people familiar with the matter. Though it still makes its swankiest label in Italy, Giorgio Armani SpA says it produces 18% of its Armani Collezioni -- which pitches wool trousers for $450 and silk jackets for $1,500 -- in Eastern Europe.
    Even "Made in Italy" stalwarts such as Prada, Gucci and Tod's say they are tiptoeing into foreign sourcing. Last year, Gucci Group NV began sewing some sneakers at a factory in Serbia while leather-goods company Tod's SpA produces a part of its Hogan sneaker line in Hungary and is considering moving that to China.
    "What do you care where I make my shoes?" says Prada Group NV Chief Executive Patrizio Bertelli. Where local laws permit, Mr. Bertelli says he'd prefer to insert a "Made by Prada" tag in his products. In addition to sewing the upper part of some shoes in Slovenia, Prada makes pieces for some of its handbags in Turkey.
    The move out of France and Italy is only just beginning. Fashion executives say some production won't ever move to low-cost countries because Italian craftsmanship is still unparalleled. Sophisticated items made in low volumes -- such as hand-woven leather handbags -- may always be "Made in Italy," for example. For the rest, the industry thinks it's only a matter of time.
    "It will take another 15 years until luxury brands' main lines are completely delocalized, but it will happen," said Tonino Perna, chief executive of IT Holding SpA, which manufactures relatively affordable collections for labels such as Versace and Dolce & Gabbana. IT Holding makes about 30% of its clothes and accessories abroad. Executives say privately that more fashion brands are producing outside of Europe than the number who care to admit it.
    This shift underscores how the developing world's manufacturing talent is improving to the point where even quintessential luxury products are starting to move offshore. It's also a sign of the extent to which high-end products are under pressure from low-cost alternatives.
    Companies from sneaker makers to automotive giants have long outsourced to China and Mexico, but luxury-goods brands have always touted Italian and French production as essential to the luxury experience. The "Made in Italy" label, with its centuries-old history of artisanship, has justified exorbitant prices. If their clothes are stitched at low-cost factories, how will consumers react? Will luxury brands eventually have to bow to pressure and lower prices at the expense of their margins?
    Many Italian fashion houses fear a backlash if they're seen hastening the decline of Italy's textile industry. For more than a century, that sector helped power the Italian economy, the fourth-largest in Europe. As companies outsourced production, sales of Italian textiles have fallen more than 10% in the past three years, with 24,000 textile manufacturing jobs lost last year, according to Italy's textile association. How to stop the trend, which is contributing to Italy's current economic malaise, is a hotly debated political issue.
    "Our 'Made in Italy' has to be defended with force," Claudio Scajola, Italian Minister for Productive Activities, said at the Milan fashion shows, which started this week.
    Alaa Arafa, the businessman who owns the Egyptian factory making Valentino suits, has little sympathy for such complaints. "Yes, some Italian jobs will be lost, but the writing is already on the wall," he says. "No Italian girl will sit at the sewing machine anymore, no matter how much you pay her."
    As a result, executives are beginning to change their tune. "We can't be closed-minded. China will be part of the process for everybody," says Franco Pene, chairman of Gibo SpA, a high-end Italian manufacturer that produces clothes for fashion labels Marc Jacobs, Michael Kors and Paul Smith. Gibo says that for now, it produces only in Italy.
    Mystique and Aura
    The "Made in Italy" mystique dates back to the early 20th century when artisans throughout the Italian peninsula began exporting their products and know-how. Neapolitan shoemaker Salvatore Ferragamo was one of the first to venture abroad when he hand-stitched shoes for Jean Harlow, Douglas Fairbanks and other 1920s Hollywood stars. Florentine leather-goods maker Gucci soon followed suit.
    After World War II, Italian craftsmen developed a second expertise. Using new ways to wash yarn, the key to high-quality knits, Italy soon surpassed Scotland as the world's best knitwear producer. By the mid-1950s, the "Made in Italy" label had developed unparalleled snob appeal around the world. Even French companies such as Louis Vuitton and Chanel transferred some production to Italy.
    The first shift came during the 1990s luxury-goods boom. Some high-end fashion companies quietly began moving production of secondary, cheaper lines to Eastern Europe to help meet rising demand. Italian handbag maker Francesco Biasia, whose purses sell for between $350 and $500, started shifting production to China and Eastern Europe in the late 1990s. Creative Director Claudio Biasia says the company gambled on what it saw as shifting tastes. "Younger consumers don't care where a product is made," he says. "They care about creativity."
    In the past two years, new problems intensified this overseas shift. Luxury-goods companies never fully recovered from the economic slump that hit their profits beginning in 2001. At the same time, rivals such as Inditex SA's Zara and Hennes & Mauritz AB's H&M flooded the market with inexpensive but fashionable copies of catwalk designs, putting further pressure on the luxury business.
    Finally, the increasing strength of the euro is eating into the margins of luxury-goods companies, which buy raw materials and pay workers in euros, but sell their products mostly outside the euro zone, in particular in the U.S. and Japan. Saving on production costs to boost margins has become an appetizing prospect.
    "The euro-dollar relationship has become such that it has made it necessary for us to look outside this country to find a cost that is more advantageous," says Prada's Mr. Bertelli.
    With this sea change comes some ticklish challenges, including managing logistical headaches. Italian leather-goods company Furla SpA began making some wallets and handbags in China in 2002, hoping to cut production costs in half, says company Chairman Giovanna Furlanetto. But because Furla needs to get products in stores fast, it's spending more than it expected moving goods by plane instead of by boat, which is less expensive but takes longer. As a result, it has cut costs by only 30%.
    Fashion trends change so quickly that companies get only one shot to produce collections for any one season, a problem that makes quality control a top priority. Gucci says it tried using a factory in China to sew some of its sneakers but wasn't satisfied with the quality. Others have gone to extraordinary efforts to maintain quality. When Prada handed partial production of some shoes to a Slovenian factory last year, it dispatched the plant's workers to Tuscany for training. Independent New York fashion house Lafayette 148, which makes knitwear, sent one of the world's top knitwear experts to China two years ago to teach factory workers Italian knitting techniques.
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