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French Montagut, once a symbol of luxury fashion, has gradually faded from the top tier of luxury brands in the Chinese market. However, the brand is now undergoing a strategic transformation to reposition itself as a high-end label. Clement Masse, Montagut China’s Chief Financial Officer, recently shared with NetEase that the company is shifting its retail model from wholesale to direct operations and franchise stores, aiming to rebuild its premium image.
"Twenty years ago, China's retail model was heavily based on wholesale, but that's no longer effective," Masse explained. "Today, it's all about franchising." Montagut, one of the first European luxury brands to enter China 30 years ago, was known globally for its iconic 'bright silk' T-shirts. In 1999, the brand established liaison offices in major cities like Beijing, Shanghai, Chengdu, and Guangzhou, and appointed regional agents in Jiangsu and Guangdong to distribute its collections across the country.
Over time, Montagut began to focus on selecting high-quality franchisees to ensure consistent quality and brand representation. The brand has since moved away from relying on third-party distributors, instead opening its own retail outlets in first- and second-tier cities. This shift was driven by the belief that direct control over distribution is essential for maintaining brand integrity and customer experience.
Pierre Gros, chairman of Montagut Group, emphasized that traditional department store models had distorted the brand's image. "The future of the brand depends on high-end quality and design, not price competition," he said. "Only through direct channels can we maintain brand management and service standards."
Last year, Gros revealed that Montagut’s own stores have grown from just three to over 20, with plans to expand to 50 in the near future. Currently, the brand operates more than 3,000 sales points nationwide, and it is working to unify the brand image across all locations. "Before, we didn’t have a cohesive look or management system. Now, we’re implementing strict franchisee selection and centralized control," Masse added.
To avoid repeating the mistakes of other early entrants like Pierre Cardin, who oversaturated the market with franchises and lost brand value, Montagut is taking a more controlled approach. The company uses an information system to monitor sales and inventory, ensuring better oversight and management of its stores.
In addition to updating its product lines, Montagut has also expanded into jewelry, aiming to diversify its offerings and boost profitability. A senior industry figure noted that jewelry typically has higher profit margins, making it a smart move for many brands.
Montagut's flagship stores are currently located in Hong Kong, Macau, Beijing, and Guangzhou, though they are not situated in the most fashion-forward districts. Candice Meyer, Montagut’s Brand Image and Communications Manager, mentioned that Shanghai is a key market, and while the brand hasn’t confirmed any new store openings there, it is considering expansion.
Although Montagut may not be as dominant in first-tier cities as competitors like Louis Vuitton or Armani, it has a strong presence in second- and third-tier cities, where affluent consumers still recognize and appreciate the French brand. Industry insiders suggest that focusing on these markets allows Montagut to maintain steady and broad profitability.
Despite its efforts to rebrand and restructure, Montagut’s executives remain cautious about discussing their strategies openly, especially regarding competition. However, the brand’s long-standing presence in China and ongoing transformation show its determination to stay relevant in a rapidly evolving luxury market.