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Category: Fashion

Retail News Asia is committed to providing both local and global retailers with the latest Fashion news throughout the Asian market. This on a daily base.

  • Ted Baker thrives on expansion

    Ted Baker thrives on expansion

    Quirky UK fashion and lifestyle label Ted Baker has announced a 20.5 per cent rise in group revenue for its third quarter to 14 November.

    Celebrating an 18.1 per cent rise in retail sales at constant rates, these results were helped by the addition of more than 32,516 sqm in average retail space (an increase of seven per cent) during the period. A planned customer event, which fell a week earlier than last year, also boosted sales.

    Despite the continued international challenges that Ted Baker outlined in its half year results last month, the company has proceeded with numerous openings, spanning Amsterdam, Hawaii, Malibu and Toronto, adding further concessions in premium department stores in Germany, Ireland, Spain, North America and Toronto over the last three months. The brand has also made a return to London’s Stansted Airport, following an £80 million transformation of the terminal. The “Departures Store”, which officially opened on November 6, has a summer holiday theme, featuring 3D Polaroid-style wall boxes set against blue swimming pool tiling and light fixtures in the shape of inflatable beach balls. An interactive digital screen across the store front senses movement and invites passersby to move closer.

    Ted Baker’s wholesale arm saw a sales increase of 27 per cent (25.1 per cent in constant currency), helped by strong trading in both the UK and North America. Group wholesale sales are expected to be 28 per cent ahead at the close of the full year.

    Ted Baker’s varied international approach has also seen licensed store openings in Singapore and Taiwan together with licensed concessions in Kuwait and Mexico. These have enabled Ted Baker to progress with expansion in the Far East despite economic volatility in the surrounding region.

    An outtake from the “Wonders Never Cease” Autumn Winter 2015 campaign, shot over five nights at London’s Natural History Museum in collaboration with shoebox film firm Crowns and Owls, currently represents the backdrop for the brand’s website. While the “affordable luxury” label has received a positive reaction to its Autumn/Winter collections so far, the swing of success at the end of the year will be heavily dependent on strong Christmas trading.

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  • Padini fears margin squeeze

    Padini fears margin squeeze

    Malaysia-based Padini Holdings expects an even tougher year ahead as it deals with a double whammy of having to cut prices and pay more for its stock.

    Padini owns the brands Vincci, Seed and Miki as well as stores trading under its own brand.

    The company has revealed margins reduced by between three and five per cent across its brands during the year to June 30 – and it fears even more reductions in the current year. It’s margin is now sitting at around 40 per cent.

    The company has had to absorb the additional six per cent GST applied on retail prices on April 1. At the same time, stock costs have risen due to the rapid deterioration of the value of the ringgit.

    “This financial year is going to be more difficult than FY15 as the weakening ringgit is affecting the cost of goods due to higher import costs,” CEO Chan Kwai Heng said in a news conference after the group’s annual meeting.

    But Chan says the market won’t accept price increases given deteriorating consumer sentiment.

    “We are more focused on driving top-line growth, and have no plans to increase our prices in the short term in order to remain competitive,” he said.

    In the year ahead the company will focus on boosting its online sales (which carry lower overheads than stores), and searching for cheaper supply sources.

    Padini plans to open 16 new stores in 2016, including nine outlet stores, mostly in new malls under construction.

    The company had earlier reported an 11.8 per cent reduction in net profit last year, blamed on aggressive promotional and discounting activities.

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  • Paul & Shark makes Korea debut launch inside Incheon

    Paul & Shark makes Korea debut launch inside Incheon

    Paul & Shark will launch its first store in South Korea with a new point of sale opening at Incheon International airport with Lotte Duty Free, and will also open its first personalised boutique onboard cruiseship Costa Fortuna.

    “Our new opening in Incheon will enable us to enjoy truly spectacular visibility for the brand. Along with the Lotte store we have another two openings planned in Seoul by the first quarter of 2016, giving Paul & Shark a very strong foot-print in the South Korean travel-retail market. These openings are both downtown duty-free – one with Donghwa and another with SM Duty Free.”Both stores will make its inaugurate launch next month. “We are so excited about these two projects,” said Paul & Shark Worldwide Travel Retail director Catherine Bonelli. “The Costa Fortuna is a beautiful ship and to have our own standalone boutique onboard is a real coup. Opening in December in the run up to Christmas could not be better timing and we’re expecting really good sell-through during the month.

    This continues a trend that has seen a 55% increase in openings for Paul & Shark over the past 18 months, of which Bonelli said around half were located in airports and the rest with cruiselines and downtown duty-free stores.

    After coming back from a busy TFWA World Exhibition last month, Bonelli sees a rosy future next year. She added that openings in 2016 were earmarked at Pudong terminal one in partnership with King Power Orient; Hong Kong International airport with Lagardère Travel Retail, and Houston with ATU-Heinemann.

    Speaking of last month’s TFWA, she added: “Cannes, with our new stand, was an incredibly busy and successful week for us with head to head appointments all week,” said Bonelli. “Our personalised embroidery service was again a particular talking point and has become a real stand-out highlight for us.

    “It’s been an incredibly busy and hardworking year for the Travel Retail team but the effort is certainly paying off and we are being rewarded with superb locations for the brand. We are confident that 2016 will be another exceptional year for us, as retailers continue to understand and realise the business potential of partnering with Paul & Shark.

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  • Hugo Boss’s sales suffer amidst the falling Chinese economy

    Hugo Boss’s sales suffer amidst the falling Chinese economy

    Hugo Boss has recently announced that it is anticipating challenges in the Chinese and US markets, which will have a negative impact on sales next year. While a decline is expected, the brand plans to continue investment in its stores and online platform.

    The German fashion retailer* announced in a presentation for its investor day that 2016 sales growth is likely to be lower than its long term target for a high single-digit increase, adding that it would only reach 2020 targets for a core earnings margin of 25% if the overall market recovered.

    These results come just a year after one of Hugo Boss’ main brands BOSS opened two new flagship stores in Hong Kong.

    Earlier this month, Burberry recorded a 9% increase in pre-tax profits, while still in the midst of a “challenging” trading environment due to China’s suffering economy. The British brand said sales at stores open for a year or longer have been affected by the Chinese climate, especially those in Hong Kong, a major shopping destination for mainland visitors.

    Up until its recent economic downturn, Hong Kong was viewed as China’s shopping centre, housing the world’s luxury and most expensive retailers. However, failing sales have led to cuts in rents and ultimately struggling retail sales, following years of luxury growth in the region.

    Both Boss and Burberry have faced a declining demand in China as well as an overall decrease in luxury retail spending. Burberry is poised to downsize its biggest store in Hong Kong, while it has been suggested that French house Louis Vuitton will also be assessing sales performance in its 8 China stores in second-tier cities.

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  • Yue Yuen sales rise on retail rollout

    Yue Yuen sales rise on retail rollout

    The world’s largest branded athletic and casual footwear manufacturer and retailer Yue Yuen Industrial says retail and wholesale sales of sportswear in Greater China rose 19.6 per cent in the first nine months of this year, due to an expanding store network.

    Yue Yuen operates more than 6000 retail stores and concessions across Greater China under its own name as well as the international brands it manufactures for.

    Total sportswear sales reached US$1.7 billion compared to US$1.456 billion in the same period last year. Other factors in the growth were the company’s efforts to increase efficiency and a better merchandise selection.

    Sales of athletic shoes were up by 3.4 per cent and sales of casual shoes were down by 5.6 per cent. The total volume of shoes sold increased by just 1.1 per cent to 231.4 million pairs for the period.

    Hong Kong listed Yue Yuen designs and makes shoes for brands including Nike, Crocs, Adidas, Reebok, Asics, New Balance, Puma, Timberland and Rockport as well as operating its own network of retail stores under the YY Sports brand, through subsidiary Pou Shen.

    The increased athletic shoes and sportswear sales helped boost Yue Yuen’s overall revenue by 5.8 per cent to US$6.3 billion and gross profit by 9.1 per cent to $1.422 billion. Total net profit attributable to owners of the company was $285.6 million, up 36.6 per cent year on year, according to figures filed with the stock exchange.

    Pou Shen, which opened 771 new points of sale during the nine months, increased its gross profit by 32.5 per cent to $566.5 million due to management’s strategy to concentrate on the retail business, improved operating efficiency, and better procurement of inventory.

    YY Sport instore wide

  • Fossil and wearable tech business

    Fossil and wearable tech business

    Fossil Group is to buy Misfit, an innovator in wearable technology and connected devices.

    The $260 million acquisition will enable Fossil to expand its addressable market, offering consumers both traditional timepieces and fashionable connected accessories. Misfit brings to Fossil a scalable cloud and app platform, a world-class software and hardware engineering team, a native wearable technology brand and a pipeline of innovative products.

    “We have a significant opportunity to add technology and connectivity across our platform of watches and accessories,” said Kosta Kartsotis, Fossil CEO.

    “With the acquisition of Misfit, Fossil Group will be uniquely positioned to lead the convergence of style and technology and to become the fashion gateway to the high-growth wearable technology and connected device markets.”

    Fossil Group is a global design, marketing and distribution company that specialises in consumer lifestyle and fashion accessories, including men’s and women’s fashion watches and jewellery, handbags, small leather goods and accessories, sold under 16 brands including Skagen. It sells through department stores, specialty retail stores and specialty stores in 150 countries, and has 600 of its own stores.

    Fossil says Misfit has already solved many of the biggest challenges with wearable accessories, including battery life.

    The deal will enable Fossil to expand its wearable market with new distribution channels, new products, new brands and new enterprise partnerships, including music, fitness, healthcare and digital entities.

    Misfit founder, Sonny Vu, said the two companies will now be able to introduce products that “blend Misfit’s seamless, intuitive technology and user experience with the design, style and branding that is the hallmark of Fossil Group”.

    Vu will serve as president and chief technology officer of connected devices for Fossil Group and will become a member of the company’s executive leadership team.

    Misfit was cofounded in 2011 by Vu and John Sculley, former CEO of Apple and Pepsi, and Sridhar Iyengar, co-founder and former CTO of AgaMatrix.

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  • Ever-Glory in sales slump

    Ever-Glory in sales slump

    Nasdaq-listed, Chinese fashion retailer Ever-Glory International Group has reported a third quarter plunge in same store sales of 21 per cent.

    Wholesale sales fell 10.9 per cent with total company revenue down 15.3 per cent to US$118.6 million.

    Wholesale sales fell the most in Mainland China, Germany and Japan and in European markets in general.

    The company operated 1188 stores at the end of September, compared to 1137 a year earlier.

    Gross profit decreased 4.4 per cent to $32.3 million, compared to $33.8 million last year, with gross margin up 310 basis points to 27.3 per cent compared to 24.2 per cent last year.

    Gross profit for retail business increased 3.6 per cent to $22.4 million. Retail gross margin increased 1130 basis points to 47.5 per cent from 36.2 per cent.

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  • Hermes Asia sales rise despite downturn

    Hermes Asia sales rise despite downturn

    French luxury label Hermes has managed to increase its sales in Asia despite the challenges in Hong Kong and the Mainland.

    The company says it achieved five per cent sales growth during the first nine months of this year in Asia excluding Japan – where sales rose a whopping 19 per cent.

    The Hermes Asia performance was due to the opening of the Maison Hermès in Shanghai in September 2014. Sales in the region improved “in spite of a difficult context in Hong Kong, Macao and to a lesser extent in continental China”.

    Globally, the brand posted sales growth of 19 per cent at current exchange rates and nine per cent at constant exchange rates, consolidated revenue reaching €3.443 billion.

    The brand’s leather goods and saddlery products grew the most – up 12 per cent – sustained by the increase in production capacities at two new sites in Isere and Charente.

    Dynamic sales in ready-to-wear and accessories –  up nine per cent – stem mainly from the success of fashion accessories and the latest ready-to-wear collections.

    The silk and textiles division grew by three per cent, despite challenges in China, and the perfume division rose six per cent.

    Watch sales fell two per cent, largely due to the category’s decline in Asia, excluding Japan.

    Gold jewellery sales helped its ‘other’ category to achieve 12 per cent growth.

    Hermes says despite the economic, geopolitical and monetary uncertainties around the world, the group is sticking with its medium-term goal for 2015: revenue growth at constant exchange rates of eight per cent.

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  • Virtual wardrobe tech comes to Singapore

    Virtual wardrobe tech comes to Singapore

    Technology from Metail, a United Kingdom fashion technology company is set to arrive in Singapore tomorrow as part of the company’s first Asian collaboration with new Indian fashion retailer abof.com. The new launch is understood to be in partnership with Singapore Press Holding’s e-commerce portal Shop.SheShops.

    According to Metail, 25% are put off online shopping because they are confused with sizing, with 44% returning clothes due to sizing issues. As it is, a majority of customers (62%) wish that images online would be more reflective of their own body shape.

    The technology from Metail is an attempt to solve – or at least alleviate – these issues by allowing users to try out their clothes virtually. This is done by generating customized body avatars dubbed as “MeModels” sporting users’ vital statistics. According to Metail, the MeModel avatar is up to 92% accurate of the customer’s own body shape.

    The objective is to allow customers to better visualize an outfit prior to making the purchase. When browsing through clothing options, shoppers can see the avatar donning selected clothes in a small docked window at the side. This only works with clothing items tagged with a “Try it on” sign though.

    CMO Innovation gave the Metail demo a spin, and the site asks shoppers for vital statistics pertaining to their weight, height and bust. This is used to estimate waist and hips measurements, which can be tweaked if desired. A handful of models can be used as the base template for the avatar, while the hair type can also be tweaked slightly. Male MeModels are not available at the moment.

    It will be interesting to see how well the technology fares with fashion brands in the region, especially in costly retail locations such as Singapore and Hong Kong. Is the technology too nascent or too hard to implement on a wide scale for brands here? Or is it arriving at just the right time to address the growing propensity for online shopping by Millennials, or Gen Y customers.

    Inline image: Metail avatar donning a Halloween-themed Poison Ivy Dress

  • Luk Fook latest to warn of falling profit

    Luk Fook latest to warn of falling profit

    Luk Fook has become the second major jewellery retailer this week to warn shareholders of a severe impact on its bottom line.

    In a filing with the stock exchange yesterday, Luk Fook said it anticipated a decline of about 40 per cent compared to the corresponding period last year.

    The company said the drop was primarily due to declining gem-set jewellery product revenue, a fall in the overall gross margin as a result of increased sales mix of gold products driven by the small-scale “gold rushes” and a higher rent to revenue ratio.

    Expanded losses in investments in relation to Hong Kong Resources Holdings and its subsidiary also contributed.

    Earlier this week rival jeweller Chow Tai Fook warned of a profit plunge as high as 50 per cent citing similar reasons.

  • Burberry Hong Kong downsizes flagship

    Burberry Hong Kong downsizes flagship

    Burberry Hong Kong is giving up a whole floor of its Pacific Place flagship as part of a range of initiatives to respond to the declining luxury market in the territory.

    Burberry CFO Carol Fairweather said in a conference call the company had reached an agreement with landlord Swire to give up the second floor part of the flagship, saying it “will enable us to drive increased sales per square foot and profitability in that store”.

    The luxury brand has 17 stores in Hong Kong, all impacted by the declining number of big spending Mainland China tourists shopping in the territory this year. Fairweather said rents had been renegotiated in a number of those stores but stressed all of them were profitable.

    “We are committed to being in Hong Kong,” Fairweather said, adding that sales have improved in recent months.

    The news coincides with the company’s release of its profit for the first half year, which beat analysts forecasts.

    Adjusted combined retail/wholesale profit was up five per cent on a same stores basis, with a planned decrease in licensing profit from Japan resulting in adjusted profit before tax of £153 million, up three per cent underlying from last year.

    “In the context of flat revenues, this result is better than expected,” commented Anusha Couttigane, senior consultant at Conlumino.

    She says Burberry is fully aware of its heavy reliance on interest from the Chinese consumer. The economic slowdown and the impact on Chinese demand is now cited as Burberry’s biggest risk.

    “In the light of these challenges, it is clear that, while Burberry continues to invest in elements that are essential for growth, it also has to make significant savings and it will take a combination of drastic measures to do so. On the one hand, this means aligning its brands under one label and its manufacturing staff under one roof. On the other, it means stripping back the privileges of a generous travel and expenses account.”

    Those cost savings are expected to deliver some £20 million to the business’ bottom line over the next 12 months.

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  • New Look China powers ahead

    New Look China powers ahead

    New Look China sales are soaring on the back of a rapid mainland rollout of the UK fashion brand.

    Globally, New Look recorded a stellar rise in both sales and profits in the first half of this financial year – driven by fast growth in China and the successful launch of the fast fashion brand’s first standalone menswear stores

    New Look was bought by South African investment company Brait in June, which said at the time a focus on Chinese expansion was a priority. In the last six months it has opened 52 stores in China and has signed leases for a further 33 stores scheduled to open by next March.

    Sales for the 26 weeks to September 26 climbed 5.9 per cent to £756 million. Pre-tax profit climbed 40.6 per cent, despite a whopping  £93.2 million bill for costs relating to the takeover of the business.

    “Our Chinese stores continue to perform well as customers continue to react favourably to our fashion-forward offer,” CEO Anders Kristiansen said in the company’s results statement. “We remain on target to have 85 stores open in the country by [financial] year end.

    “With the support of our new owners, Brait, we are planning to increase investment in our strategic initiatives to accelerate our growth,” he said.

    Globally, New Look has 385 stores, and it plans to continue to open more in its home market. It also plans to continue to grow its online business. Some 31 per cent of New Look customers buying online use the ‘click and collect’ service – collecting their purchases in a physical store rather than waiting for delivery.

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  • Moncler Tokyo flagship opens

    Moncler Tokyo flagship opens

    Moncler has opened a new flagship store in Japan’s highest profile shopping strip.

    The Moncler Tokyo boutique in the Ginza comprises 560 sqm spread over two floors. It was designed by Parisian architects Gilles & Boissier.

    Moncler Ginza 1

     

    For years this studio’s ties with the fantastical world of Moncler have resulted in a lively partnership and the new Japan store is no exception.

    Coinciding with the opening was the launch of a new partnership with young Los Angeles artist duo,FriendsWithYou.

    Moncler Ginza 5

     

    “Once again the Italian-French brand is working directly with today’s young and creative generations, interpreting and assimilating its language, sources of inspiration and moods. The universe of comic signs of the FriendsWithYou duo, their references to pop icons such as Malfi, Snowy, Happy Virus, Look Who, or the fluorescent rainbow of Mr TTT, the visual repertoire of smiling graphic clouds, of penetrating, astonished eyes, of mouths and fun monsters, are the hallmarks of a collection of puffer jackets developed in different colors that range from black to light-blue, from red to yellow, which are completed by sweatshirts, t-shirts bags and sneakers,” explains Moncler.

    Moncler Ginza 3

    The Moncler FriendsWithYou collection will be sold in all Moncler single brand stores from the Fall-Winter 2016/17 season onwards.

     

    Moncler Ginza 2

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  • Chow Tai Fook in profit plunge

    Chow Tai Fook in profit plunge

    Listed Hong Kong jeweller Chow Tai Fook has warned shareholders its first half profit is likely to be 50 per cent less than for the same period last year.

    In a statement filed with the stock exchange, the board said the decrease is mainly attributable to the year-on-year decline in revenue brought about by weak consumer sentiment in Hong Kong and Macau and a tighter gross profit margin.

    The margin was impacted by both a change in the product mix with increased sale of gold products and unrealised hedging losses on gold loans for the period contrasting with an unrealised hedging gain in the same period last year.

    “As the company is in the process of preparing the interim results of the group for the six months ended 30 September, the information contained in this announcement is only based on the preliminary review of the company’s management accounts which have not been reviewed or audited by auditors of the company.”

    The size of the decline comes as something of a surprise, given the company revealed a four per cent increase in sales in the quarter to September 30 just four weeks ago.

    Back then Chow Tai Fook described the Hong Kong and Macau retail market as “continuing lacklustre”.

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  • Giordano Hong Kong sales rise in soft market

    Giordano Hong Kong sales rise in soft market

    Giordano Hong Kong sales increased by four per cent in the last quarter, with same store sales up a staggering 12 per cent in a stagnant retail market.

    The company says with the decline in Mainland China visitors to Hong Kong and Macau, the company has repositioned its product range to focus on more basic essential products. “This resulted in strong volume growth compared to the same period last year.”

    Total sales for the quarter to September 30 were HK$1.240 billion, three per cent lower than the same period last year. On a constant currency basis, sales increased by two per cent.

    Despite encouraging results in its home market, Giordano reported the depreciation of local currencies against the US dollar in Southeast Asia, Taiwan and Australia is depressing reported sales growth at the group level, and pushing costs up in those markets.

    In the first half of 2015, the company completed the acquisition of its franchisees’ operations in Kuwait and Qatar. Excluding these transactions, sales would have decreased by four per cent and on a constant currency basis, sales would have increased by one per cent

    Brand sales for the quarter were flat compared to the same period last year. Comparable store sales for the quarter increased by four per cent, mainly due to improving performance in Mainland China, Hong Kong and Singapore.

    The total number of stores in the group declined by 19 to 2359 primarily due to the closure of unprofitable stores in Mainland China.

    Gross margin for the quarter grew by 0.1 percentage point to 58 per cent, despite higher purchase costs due to weak overseas currencies, which reduced gross margin by 1.4 percentage points.

    Gross profit for the quarter was HK$719 million, a decline of three per cent over the same period last year.

    Sales in Southeast Asia declined by seven per cent, reflecting the impact of weak local currencies which on average depreciated by 16 per cent against the Hong Kong dollar in the last 12 months. However, on a constant currency basis, sales grew by nine per cent. Comparative store sales grew by eight per cent in the quarter with strong recovery from last year in Singapore and Thailand in particular.

    Sales in the Middle East have climbed by 11 per cent with strong growth in the UAE.

    Giordano’s new budget brand “Beau Monde” is still under development.

    “At the end of the period we had 14 shops and we expect to increase this to 25 shops by the end of the year. As we improve the merchandise for this new brand, we expect to reach break even profitability in the fourth quarter of 2015 or the first quarter of 2016. This will enable us to develop this brand faster in 2016,” the company said in its stock exchange filing.

    “As we reposition our brands through the exit of non-performing shops and poor quality locations, we are also investing in store upgrades, and by December we expect to have upgraded two thirds of our store portfolio in the past two years. During the third quarter, we upgraded/opened 39 self-managed stores and 51 of our franchisees’ stores. By the end of 2015, we expect to have upgraded/opened 200 shops in the year. This compares with 397 shops renovated in 2014.”