Gucci-owner Kering has forecasted a significant drop of approximately 20 per cent in Gucci's sales for the first quarter, citing a sharper decline than anticipated in the Asia-Pacific region. This setback further widens the gap between the French luxury conglomerate and its primary competitors.
Owned by the billionaire Pinault family, Kering has grappled with staying abreast of competitors like LVMH and Hermes International, particularly as luxury sales cooled off in the past year, notably in China. LVMH's diverse brand portfolio and Hermes's enduringly long waiting lists for coveted handbags have bolstered these companies' resilience.
According to analysts at Vital Knowledge, Gucci has been facing internal challenges for several quarters, but this latest update will amplify concerns regarding consumer spending and the state of China's economy.
Overall, Kering’s comparable sales are anticipated to decline by about 10 per cent i across its portfolio. This includes esteemed labels such as Balenciaga and Saint Laurent.
Gucci's sales declined during the closing months of the previous year as the brand grappled with attracting more affluent shoppers to its high-priced Double G belts and Princetown slippers. A year ago, Sabato De Sarno was appointed as the brand's new designer.
