China set to become jewel in Tiffany crown

By Bao Chang (China Daily)
Updated: 2010-11-02 07:48
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China set to become jewel in Tiffany crown

Shoppers at the Tiffany & Co flagship store on Fifth Avenue in New York. The jeweler has aggressive expansion plans in China after reporting strong sales growth in the country. Ramin Talaie / Bloomberg

US jeweler aims to open more stores on the back of rampant demand

BEIJING - Tiffany & Co, the US jeweler, said it is pinpointing China as the place where it will open the most stores globally over the next three years, a move driven by robust sales growth in the market.

"China will rapidly become the place where we will have the greatest number of new stores. Within the next three years, the number will stand between 25 and 30," Michael J. Kowalski, chairman of Tiffany & Co, told China Daily.

The New York-based company plans to open 14 stores during its current fiscal year, which ends in January 2011, and four of those outlets will be in China.

"We will keep the same pace on store openings during the next fiscal year, but will invest more in China's second and even third-tier cities," Kowalski said.

In the second quarter of 2010, Tiffany witnessed its fastest growth in China, with a 27 percent increase compared with the same period last year.

Kowalski expected sales in the Asia-Pacific region, led by China, could increase by a mid-20s percentage for the whole year.

At present, the jeweler has 12 retail stores and boutiques the country, including three in Beijing, four in Shanghai and one in Chengdu.

Tiffany's new store at China World Shopping Mall in Beijing will open in November, with another in Kunming set to begin trading in December.

To attract as many customers as possible in its fastest-growing market, Tiffany unveiled its 2011 jewels and diamonds collections in Beijing on Oct 22 - the first time the brand has unveiled a major new collection outside its home market.

"We aim to let Chinese customers become more familiar with the connotation and history of our brand through this activity, which brings Tiffany closer to its Chinese buyers," Kowalski said.

In contrast to other luxury brands, whose stores are operated by their Chinese distributors, all of Tiffany's boutiques in China are owned directly by the company, and Kowalski said they do not plan to involve a sales agency.

He said the company can manage the business even when entering an emerging market and will not compromise long-term value in pursuit of short-term benefits.

Currently, 97 percent of Tiffany stores around the world are operated directly by the company.

Tiffany also said China will surpass the United States to become the largest jewelry market in the world over the next five to 10 years.

Kowalski said the Chinese market is growing so rapidly that even three years ago he could never have anticipated opening 12 stores and seeing the country provide the company's biggest growth figures.

Next year, yellow diamonds will be a growing part of Tiffany's designs around the world and it expects strong sales of the new collection in China.

China Daily