In a time where the retail industry is facing a decline, especially in Singapore, one luxury brand is standing out for its nerve to venture into new markets.
Hugo Boss recently opened its first store in Colombo, Sri Lanka last Friday (April 28) in a country that doesn't have a luxury market (well, it does now).
The 116 sq m space is located in Arcade Independence Square - a beautifully restored British colonial building constructed in 1889 that was once an asylum. The Boss Menswear Store stocks formal and sportswear collections.
"I think that in the current slow down, the strong will get stronger, and this is where you differentiate the big boys from the small ones. We are still expanding", said Mr Steven Lam, managing director at Hugo Boss Southeast Asia who hosted AsiaOne to the opening of the store.
"We are a destination brand. We are not a window shopping brand," pointed out Mr Lam. And Sri Lanka is definitely a destination to travel to.
Mr Lam explained that he had no intention initially to open a store in Sri Lanka, but eventually did so after meeting a representative of Sri Lanka's largest retailer group - Abans Group of Companies - in Hong Kong through an acquaintance two years ago.
"It always helps when your business partner is already a big fan. You don't need to sell them anything," said Mr Lam.
However, dealing with the government was a challenge.
Construction of the store started in January this year but they weren't allowed to put up external signage since the location is in a heritage building. The compromise was a video wall.
At the opening, an eye-catching video display was set against the classical façade of the Arcade Independence Square for the viewing pleasure of 300 invited guests.
Another issue was human resource especially with Sri Lanka being a new country for luxury retail.
"To get that guy with the mindset of selling a luxury product is quite challenging because it doesn't exist," said Mr Lam.
So, people who worked in hospitality such as hotels or restaurants catered to tourists were sourced. This was a similar problem faced when they opened their first store in Myanmar - another emerging market that Hugo Boss had ventured to.
Sri Lanka was a war-torn country 10 years ago and only in the last seven to eight years, there's been economic boom and stability.
"In the past, people were not willing to be seen spending in public. A lot has changed. There's now Mercedes-Benz cars on the streets, people are wearing Rolexes," said Mr Lam.
In the past, people were not willing to be seen spending in public. A lot has changed. There's now Mercedes-Benz cars on the streets, people are wearing Rolexes.- Mr Stephen Lam, managing director at Hugo Boss Southeast Asia
While his luxury brand colleagues may not think of Sri Lanka as a retail spot yet, there is great interest in wanting to come for a visit.
"Tourism grows by 30 per cent year on year and Sri Lanka is probably one of the fastest growing tourist markets in Asia right now", shared Mr Lam.
Ideally, Mr Lam would like the store's clientele to be 70 per cent local "because we have the tourists covered in Singapore or Hong Kong or London."
"We open a shop, always, to tap on the local clientele. I tell my team that tourists are bonus. You need to sustain your business with local clientele," advised Mr Lam.
Also, the suiting business will be catered to the locals especially during wedding season that starts in June. And Sri Lankans tend to spend on weddings.
Health and time is the new luxury
Having 16 years in the luxury business, Mr Lam shared that he enjoys the way the definition of luxury changes. When he first started out, luxury was an 'it' bag which is now almost non-existent.
"Now, luxury is luxury of health, time, an experience that money cannot buy. To me, this is the new luxury. And, of course, timelessness in clothing, in bags.
"No longer are people chasing for the one season bag. Now they are looking for things that are timeless, things that can be passed to the next generation like diamonds, gemstones, watches, and experiences that money can't buy. Like making a trip down on your 40th to Bhutan, to Tibet, staying at the Como," said Mr Lam.
The luxury business is competing in a very different competitive environment than before.
"I'm competing for your wallet on different things - gastronomy, Michelin star restaurants, travel to very exotic places, art, sports events. I think that the word luxury has changed from not so long ago to where we are today, and that's what makes the luxury business so exciting," added Mr Lam.
With Sri Lanka being an exciting experience in itself, Hugo Boss has shown grit with its recent openings.
In March, the brand opened a store in Cape Town, South Africa. Yangon will have its first stand-alone shop in May, and wealthy Pakistanis in Lahore and Islamabad can possibly look forward to a store opening at the end of the year.
Expanding on Hugo Boss' confidence, Mr Lam told me what makes the Boss person.
Without hesitation, Singapore's Olympic darling Joseph Schooling is Mr Lam's "quintessential Boss person.
"He is champion in his own right, in the swimming pool and outside, and he's a true gentleman. I think if you were to say there's someone who's going to be the Boss person, I hope that when he becomes pro we will have a chance to work with him."