Accessories lead the way for Italian luxury brands

After a 4.5% fall-off in production in 2003, losses for Italian luxury companies in 2004 should stabilize at 0.3%, but the growth expected for 2005 and 2006 is 0.7% and 0.9%, respectively.

There should be a 1.4% increase in exports this year, 4.9% in 2005 and 5.5% in 2006, against -9.4% in 2003 and -5.2% in 2002. The sprint in year-end billings can be linked to accessories. According to Carlo Pambianco, chairman of the consultancy company of the same name, bags, perfumes and glasses represent 'the sector that has survived the crisis of recent years with the most success', as well as being a type of product 'that is very popular in the Usa and in Asia, the major luxury goods markets (both these areas account for 30% of billings)'.

For this reason, Pambianco says, it is probable that the segment 'will smooth the way at year end given that for luxury companies, the fourth quarter (October through December) corresponds to the Us holiday season and is very important for billings from Christmas sales'.

The effect of footwear, leather goods, eyewear, perfumes and jewelry sales depends on the company and for some they are their core business. 'For example, for Tod's and Ferragamo', Pambianco continued, 'leather goods account for almost 100% of their business. Prada's only real accessories are cosmetics and eyewear (just 2% of billings in 2003), whereas 81% of Gucci's billings in 2003 were linked to products other than clothing; out of a total of 2.1 billion in billings, 600 million came from perfumes and jewelry. The impact is more limited for Armani (only 47%) and Dolce&Gabbana (45%; billings of 868 million included 70 from leather goods and 310 from perfumes, eyewear and watches)'.

(Source: Plus - Il Sole 24 Ore)