Friday, January 20, 2012


Central Retail Corporation (CRC), the country's largest retail chain, has gone European, using Italy as a gateway to expand its retail empire worldwide.

It became the first Asian retailer to really penetrate the continent after buying La Rinascente department store last year.

Vittorio Radice, CEO of La Rinascente, said the company would spend 100 million to open two new La Rinascente department stores in Venice and Rome and remodel its existing stores in Milan and Florence over the next five years. It has 10 stores in Italy now.

The new department stores in Italy will focus on Venice, Milan, Rome and Florence, which are among the world's top 50 tourist destinations.

Of the total budget, 40 million will be used to develop the new store in Venice by converting a 1,000-year-old building near the Venice market. Work will begin within 30 days and be complete by 2014.

The company chose Venice because the city has 22 million foreign visitors a year, with that figure expected to reach 27-28 million by 2020.

The remaining 60 million will be used to renovate stores in Milan, Florence and Rome. Each has a different design reflecting the city's culture.

CRC CEO Tos Chirathivat has focused on growth in Asean, but the company got La Rinascente by accident last year.

Though Europe is not its priority, La Rinascente is a special case. CRC made the purchase in order to boost its luxury image.

Moreover, Italy has few big department stores and the biggest one is La Rinascente at Duomo in Milan. If CRC opens new department stores in Rome and Venice, its business in Italy could double.

CRC is re-entering the luxury market after attempting it 10 years ago. Central Department Stores upgraded to add more luxury brands.

Though Italy has had an economic recession, its impact on La Rinascente should be short-lived.

Sales at La Rinascente last year were 430 million, up 6% from 2010. Sales are set to grow 10% this year.

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