Cucinelli says luxury group’s go-slow approach in China will help protect brand

Luxury cashmere maker Brunello Cucinelli SpA is taking a go-slow approach to new openings in China as it looks to protect the brand’s cachet.

“We see great growth opportunities in the country, but don’t count on us growing by 50 shops per year,” Brunello Cucinelli, founder and executive chairman of the Italian company that bears his name, said in an interview.Opening more than one or two locations per year would risk turning the luxury label into a commodity, Cucinelli said, speaking just after his return from a visit to China. “We don’t want to overexpose our brand, so no logos, no paid influencers.”

The store experience will also continue to be different than some peers, the founder said, with sales staff earning limited commissions and trained to avoid “jumping on” clients. Cucinelli’s group earlier this month reported a rise in sales for the first nine months of the year and confirmed its revenue growth forecast of about 10% for this year, 2025 and 2026.China accounts for 13% of sales, and the target is to raise that 2% per year through 2026. The go-slow approach is specific to China, where “if you rise too fast, you go down quickly,” the 71-year-old Cucinelli said. “In a hyper-connected country like China, the risk is becoming something ordinary.”Still, the founder is more upbeat on prospects for China than some other industry executives who’ve expressed concerns on slowing domestic demand.Luxury sales in the country have “normalized” after the second half of 2023, he said, when many wealthy Chinese cut back at home but spent freely during foreign travel.

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Companies like his own, as well as Loro Piana, Cartier and Hermès — which caters to the wealthiest client group — are performing best, Cucinelli said, and he underscored how use of top-quality materials and process have helped shield his brand’s exclusivity.“Desirability is not the same as exclusivity — you can desire a pizza, but that doesn’t make it exclusive,” he said, noting that peers who’ve raised prices while attempting to appeal to broader customer bases have suffered.France’s Kering SA, the owner of the Gucci label, warned last week that its annual profit will fall to the lowest level since 2016. Earlier this month LVMH reported a drop in sales for the third quarter, the first decline since the pandemic. Cucinelli said his company will stick to its plan of raising prices a maximum 2% this year and 3% to 4% in 2025, warning that luxury consumers can’t be counted on to continually absorb rising costs.“In our sector some increases in the last few years were not completely justified by higher energy or raw material costs,” Cucinelli said. “Just because customers are wealthy and can afford expensive goods doesn’t mean they’re careless with their money.”

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