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The Warsaw Voice » Other » September 3, 2008
Economic Forum in Krynica
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Taste for Luxury
September 3, 2008 By A.R.    
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The Polish luxury goods market has been expanding rapidly for several years and is now estimated to be worth around $2 billion. This is a rough estimate because no one collects statistics on the value of the Polish luxury goods market. Additionally, the standards a product has to meet to be regarded as a luxury item are vague. Luxury cars form a large part of the Polish luxury goods market, but expensive brand-name cosmetics, clothes, alcoholic drinks and jewelry are also important items.

Rich man's toys
According to the Samar company, which monitors the Polish car market, in the first half of this year Poles bought 7,200 luxury and ultra-performance cars. Samar President Wojciech Drzewiecki estimates that the luxury vehicle segment is growing by around 100 percent annually. Manufacturers have noticed this trend. Bentley arrived in Poland in March while Infiniti will do so in October. In the first five months of the year, 12 Bentleys, nine Ferraris, seven Aston Martins, four Maybachs and one Rolls-Royce were sold on the Polish market. Sales of such brands as Porsche, Lexus and the most expensive Mercedes, BMW and Audi models are in the hundreds.

But having an expensive car is not enough to solve its owner's transport problems because the state of Polish roads is disastrous and traffic jams on the most popular routes make it impossible for drivers to travel fast and comfortably. A private plane may be a good option for those with really big money and it is all the rage now among Polish businesspeople. The number of private planes is growing quickly in Poland and flying courses are flooded with would-be pilots. There are now over 600 private planes in Poland, most of them second-hand aircraft. But recently the number of new models has been on the rise. Jan Borowski, the owner of J.B. Investment, a Polish dealership for Piper, Diamond and other aircraft, estimates that from 100 to 200 new planes will be sold on the Polish market every year. A new plane costs on average from zl.500,000 to over zl.1.5 million. But one rich Polish customer recently ordered a Hawker 900 XP worth more than $14.6 million.

Meanwhile, for a self-respecting millionaire a private plane may not be enough-they may decide they also need a luxury yacht. Buying one in Poland is no problem because yacht building has developed into something of a Polish specialty. There are more than 10 yacht construction yards in the country. Most of the output from Polish yards goes to foreign customers in Germany, the United States, France, Spain, Greece, Israel, Australia and other countries. Sailboat prices start at zl.30,000, while large luxury yachts cost more than zl.200,000, but Polish yards also produce yachts worth several million euros.

Sharp suits, costly cosmetics
Leading luxury goods producers, mainly those from Italy and France, believed for years that the Polish luxury market was too small and so were not willing to open stores in the country. But this is changing. And this comes as no surprise considering that Polish consumers spend at least $2 billion annually on high-end products-mainly food but also cosmetics and clothes.

Suits with a price tag of zl.15,000 or bags worth zl.2,000-zl.3,000 are finding more and more buyers in Poland. Demand for watches and jewelry is also on the rise. At jewelry shops, purchases worth more than zl.20,000 have become commonplace while some buyers spend as much as several hundred thousand zlotys on a single occasion. Sales of expensive cosmetics are also growing. According to cosmetics industry insiders, the Polish cosmetics market is worth around zl.8-10 billion. Expensive and luxury cosmetics account for over 10 percent of the cosmetics market so it can be estimated that the luxury segment is worth up to zl.1 billion.

More boutiques with luxury clothes are appearing in Poland. Many brands are already present in the country, others are preparing to enter the market. These include Cacharel, Louis Vuitton and Chanel. "The Polish luxury goods market is expanding increasingly rapidly. Global brands can see this potential so we can expect more expensive brands in Poland," says Jerzy Mazgaj, president of Paradise Group, which has already brought to Poland such brands as Hugo Boss, Ermenegildo Zegna and Burberry. The company is going to open a Kenzo store in Poland this year and a DKNY store in 2009.
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