French handbag maker LongChamp Co Ltd expects China to be among the top five global markets by 2013, a top company official told ChinaDaily.com.
"The Chinese market has the biggest potential," Jean Cassegrain, chief executive officer of LongChamp, told the newspaper in an interview. "The growth in the Chinese market has been over 30% in the last five years and we expect the momentum to continue."
Currently the company's five biggest markets by revenue are France, United States, Germany, Japan and South Korea. Cassegrain said China would probably overtake Japan and South Korea to be the top market in Asia.
China is now the world's second biggest luxury goods market, with sales averaging $9.6 billion (NZD$13.5 billion) in 2009. It also accounts for 27.5% of the global market, according to consultancy company Bain & Co.
Sales in China are expected to reach $14.6 billion in the next five years, making it the world's top luxury market.
LongChamp has 14 stores in China and Cassegrain said the company intends to grow it to around 40 by 2015. The French company has 130 stores worldwide.
The company makes most of its products in France, with only a fraction - less than 10% - being made in China.
But Cassegrain said the company will increase manufacturing in China along with growth here. At the same time the company will also take steps to ensure that the quality of the products manufactured in China are in no way different from other regions.
Earlier this year, LongChamp bought out its Chinese distributor and localised the management, in line with its long-term development goals in China, said Cassegrain.
The buyout was also part of a broader move by international companies to gain control of their luxury brands from Chinese partners, analysts said.
In July, Burberry said it plans to buy its network of 50 China stores in 30 cities for 70 million pounds (NZD$153 million), a deal likely to add up to 20 million pounds to its 2011-12 operating profit.
Polo Ralph Lauren has also bought back its distribution rights in China from Dickson Concepts.