Shang Xia, “Hermès Made in China” arrives in Paris

French luxury group Hermès plans to open a shop of its brand “Shang Xia” in the district of Saint-Germain-des-Prés by the end of the year. To date, the brand operates in Shanghai where it was launched in late 2010.

Shang Xia in Paris will open at a highly prized strategic location, not to disorient the Chinese visited France, where these tourists spend about 500 million euros every year. But it will take some patience before discovering Shang Xia, as the store will not open “until the end of the year,” said Hermès.

Meaning in Mandarin Chinese “upside down”, Shang Xia debuted in Shanghai, in a shop of 125 square meters with very clean, minimalist style, situated on the first floor of the upscale mall Hong Kong Plaza. It offers jewelry, furniture and tableware at prices ranging from 15 to more than 40,000 euros. Is cheaper than branded Hermès products.

Shang Xia has been chosen to conquer the Middle Kingdom by focusing on a catalog of products all related to the local culture. “We operate through organic growth and the idea was to transfer the philosophy of Hermès in China, making a Hermès in China,” explained Patrick Thomas, CEO of Hermès, at the inauguration of the first shop.

The brand operates completely independently of its parent. “If Shang Xia becomes a competitor of Hermès, it will be a success,” Patrick Thomas was then assured. A year later, the brand had exceeded its sales targets. In celebrating the first anniversary of Shang Xia, however, the group admitted they hadn’t made any profit and did not expect it in the near future. Shang Xia “is not a loss, it is an investment,” reiterated Patrick Thomas. As the sign of his optimism over the long term, Hermès will open a second shop of Shang Xia in China Beijing, in the second half of 2012.

Hermès has about forty shops in Greater China (Mainland, Hong Kong, Macao, Taiwan). China, where the group realized 11% of its sales in early 2011, should become the first global luxury market by 2015, according to industry estimates. For now and have been for twenty years, Japan remains the biggest market for luxury products.