Milan fashion cuts its cloth to fit recession
By Antonella Ciancio
MILAN (Reuters) - Milan fashion houses hope emerging markets will allow the luxury industry to ride out any new recession.
Executives at Milan fashion week were happy to talk about the prospects for growth this year but were coy about 2012 in the face of financial market wobbles and the effect of austerity measures on the mood of European consumers.
"Fashion houses have worked on prices, costs. They are getting ready to face a crisis that we hope will not last long," Roberto Cavalli group's chief executive Gianluca Brozzetti told Reuters at the show of Just Cavalli.
The luxury industry is normally the last sector to enter recession and the first to rebound, but companies realize they will not be immune from any re-run of the 2008-9 downturn.
Known for its animal prints and flowing dresses, Cavalli is betting on the relaunch of its youthful Just Cavalli line with Diesel's founder Renzo Rosso and on new store openings in fast-growing markets next year to ride out the storm.
"Demand from emerging countries should offset losses in mature markets," Brozzetti said at a smoky former warehouse on Saturday where denim-clad models wore flowing silk dresses.
In a clear sign the industry is cutting its cloth to fit leaner economic times, top brands are widening their entry-level offer to satisfy all pockets and needs.
"I think we're witnessing a degree of nervousness that we haven't seen since 2008. The European markets are looking very fragile and US wealthy sentiment is turning bearish," James Lawson, director of international luxury market research specialists Ledbury Research, told Reuters. Continued...