British luxury fashion brand Burberry is closing its flagship store in Hong Kong in a move that marks the latest in big-name fashion brands that are stepping away from the world’s top destination for luxury retail.
The move by Burberry follows a similar shutdown in a different section of the Chinese-controlled city last year as strict ongoing COVID restrictions continue to plague the region and tourism.
Burberry cited the lack of customers able or willing to come into the store to make purchases as the pandemic raged on, especially with the rise of eCommerce options in luxury fashion, a report from Inside Retail Asia said Monday (July 11).
Canton Road in Hong Kong is considered “a hub for luxury brands,” the report says, and is home to the Harbour City shopping mall. It was a bustling destination for tourists who visited the Mainland before the pandemic led to closures, quarantines and shutdowns across the nation and around its borders.
Burberry opened its Canton Road flagship in 2011. WWD reported the space to have a monthly rent of $1.12 million. The closure leaves Burberry with 10 stores across Hong Kong.
Valentino, Tiffany & Co and Coach also shut down stores because of a lack of tourists able to get into the country at all and into the Canton Road neighborhood in particular, the report says. Earlier this year, Hong Kong strict COVID-19 restrictions during the height of the spread of the omicron variant led to widespread retail and restaurant closures, the report says.
Related: Luxury Retailers Defy Slump, as Full-Price Sales Reflect Pent-Up Demand
In January, during Men’s Fashion Week in Paris, Burberry’s “higher quality business” saw its full-price sales rise 26% in the quarter versus comparable 2019 levels, while its total same-store sales slid 3% as a result of what the iconic plaid-patterned retailer said was its planned exit from markdowns at its stores and website.
To drive demand and engagement, Burberry, for example, cited a mix of innovations that helped it attract first-time buyers and drive double-digit full-price sales growth across all product categories, including renewed focus on “distinctive and meaningful storytelling and experiences,” a first-ever ad campaign dedicated to outerwear and a new store concept as well as a mix of digital and omnichannel innovations.