Milan's designers bag accessories business

MILAN, Oct 3 (Reuters) Who wants to be a trendsetter when business is going so well? That was the mood at Milan fashion week, with designers showing one classic, archive-inspired collection after another.

Creative energies shone instead in shoes and bags -- every chief executive's favourite because of their high profit margins.

''It's been a season of accessories instead of fashion.

That's the strength of Milan. I think there are many houses but maybe not so many very influential designers,'' said Anna Wintour, editor of American Vogue magazine, at last week's Versace show.

Italy's reputation as a producer of exquisitely crafted leather goods reaches back to the Middle Ages, and today buyers are still willing to pay thousands of euros for a real Prada or Gucci bag despite a thriving counterfeit industry.

With shoe and bag sales booming, many companies that previously had no strong presence in leather goods realised how much money could be made in the sector. Armani and Versace, for example, have both invested heavily in expanding their accessories business.

Accessories take up less shop space than clothes, they don't waste space with changing rooms, and there are no awkward sizes to be discounted at the end of the season.

And unlike the mini-dresses and pencil trousers seen on Milan's catwalks, they can be worn by anyone regardless of body shape.

A BRAND-NEW BAG ''If the dress doesn't fit, you can always buy the shoes or the handbag. It's the simplest way to update your wardrobe. You buy a handbag covered in studs and you're suddenly in fashion,'' Wintour said with a slight smile.

Asked about must-have items for this autumn and winter, buyers at the shows immediately mentioned ''It bags'', meaning particularly coveted handbags such as Fendi's Spy or Chloe's Paddington bag that are seen dangling off the arms of model Kate Moss and other celebrities.

On fashion Web site www.netaporter.com, the Fendi Spy was priced at 1,450 pounds and the Paddington, at 794 pounds. Prices can be much higher if a precious material such as crocodile or python skin is used.

''Leather goods are number one for us. The money is there, especially for bags worn by VIPs,'' said David Cheung, who came to Milan to buy for retailer Villamoda in Kuwait.

With producers and buyers rubbing their hands at the thought of an endless accessories boom, the big question is whether women will continue to buy into the bag craze and what will be the next big accessories fad.

''I have a feeling about backpacks,'' said Linda Fargo, fashion director at luxury retailer Bergdorf Goodman, after a parade of big backpacks at Prada's fashion show.

''(The models) all carried backpacks as handbags. There was a time when we all used to carry backpacks and we may see that again,'' she added.

REUTERS BDP KP0856