JUST as retail may be heading for a slump, local retailer FJ Benjamin is pumping $4.6 million into expanding its retail network for a product many would see as a luxury, especially in tough times.

American fashion brand Guess is launching a worldwide campaign to sell a range of its premium jeans later this year.

As the brand's exclusive distributor in South-east Asia, FJ Benjamin is confident of fast-growing demand for these upmarket jeans, even though they sell for up to $539 a pair.

The company's chief executive, Mr Nash Benjamin, is putting his money where his mouth is.

He told The Straits Times he plans to open four new stores totalling about 15,000 sq ft of retail space in upcoming malls in Orchard Road and the integrated resorts from now till 2010, when these new properties open for business.

'It will require an investment of $4.6 million, and we project to grow this business in Singapore over the next two years by 58 per cent,' Mr Benjamin said.

FJ Benjamin, which has been distributing Guess in the region for 17 years, announced yesterday that it had renewed its licence to manage the brand in the region until 2014, with an option to renew it again till 2019.

Guess sells 80,000 pairs of jeans a year in the region at an average price of $187, Mr Benjamin, 56, said. That amounts to almost $15 million worth of blue trousers annually. And he now wants to up this annual figure to 130,000 pairs to rake in $9.3 million more.

A pair of jeans from Guess' new range is priced between $239 and $539, much more expensive than, say, a pair of Levi's, which averages about $150 a pair.

Yet, Mr Benjamin is sure he can sell 50,000 more units - even at these higher prices - in the next 18 months.

'Yes, we've seen the market softening in the past several months, but Guess has always been recognised as a leader in denim, and I am confident we will grow our market share.'

FJ Benjamin's confidence in consumer spending is at odds with the current slowdown in global retail.

In February, retail sales in Singapore fell for the first time in seven months, as inflation hit a 26-year high and worries swirled about the health of the world economy. In constant price terms, sales in the retail sector fell 5.7 per cent. They slipped 0.6 per cent in the United States and 0.5 per cent in Europe.

Guess has 800 stores worldwide. FJ Benjamin operates 70 stand-alone Guess stores across Singapore, Malaysia and Indonesia, making the home-grown company responsible for running nearly 10 per cent of the brand's US$5 billion (S$6.8 billion) enterprise.

The first Guess store opened in Singapore on May 1, 1991. Within three years, FJ Benjamin had opened 45 shops in places such as Taiwan and Australia.

But in the mid-1990s, Guess found itself at the centre of a price war.

'Our brand was getting killed. We didn't mean anything to the customer. It was all about price point,' Guess founder Maurice Marciano told American fashion newspaper Women's Wear Daily in an article last year.

Ten years on, price is much less an issue with increasingly wealthy consumers in Asia.

'It's about having a great premium product, strong brand and marketing,' said Mr Benjamin.

This article was first published in The Straits Times on May 6, 2008