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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.

  • Bulgari to open 300th boutique this year

    Bulgari to open 300th boutique this year

    LVMH’s watch and jewellery flagship brand Bulgari is eyeing double digit growth in 2015, despite the lacklustre global luxury market.

    Bulgari expects to surpass 300 boutiques this year, part of a strategy by CEO Jean-Christophe Babin to maintain its position as one of the fastest growing brands in the Louis Vuitton group’s 60-strong stable.

    “We had a very good beginning of the year, so all else remaining equal, we think that we will do better this year than in 2014 with a double-digit growth rate,” said Babin in an interview with Reuters.

    Bulgari ended 2013 with 290 stores globally and expects to end 2015 with as many as 312.

    LVMH does not break down its trading figures by brand, but analysts estimate Bulgari achieves annual sales of between 1.5 billion and 2 billion euros.

    It is ranked third in size behind Cartier and Tiffany.

  • H&M soars in first quarter

    H&M soars in first quarter

    H&M says global sales in its first quarter – to February 28 – soared 15 per cent year-on-year on a local currency basis.

    CEO Karl-Johan Persson says the increase reflected well-received collections for all brands in the group, which boosted market share.

    Sales excluding VAT totalled US$4.73 billion.

    Gross profit increased by 26 per cent to $2.6 billion, which corresponds to a gross margin of 55.2 per cent, compared with 54.9 per cent the previous year.

    In the first quarter, H&M opened its first store in Taipei, Taiwan, and in the next three months will make its debut in Macau where it has two stores planned, along with entering Peru for the first time. In the second half of the year it will add Africa and India to its global footprint.

    The company said in a statement that sales in the first three weeks of the second quarter rose nine per cent in local currencies.

    “The year has got off to a very good start and we have great faith in our offering. Although the strong US dollar will affect our sourcing costs going forward, we will make sure that we always have the best customer offering in each individual market,” said Persson.

  • Hengdeli shifts focus to mid market

    Hengdeli shifts focus to mid market

    Chinese watch retailer and wholesaler Hengdeli Holdings is to expand into the mid market as it mainland China business grows.

    Hong Kong-listed Hengdeli specialises in high end watch retailing in mainland China, Hong Kong and Taiwan and has relationships with major global suppliers including Swatch, both LVMH and Richemont, Rolex and Kering.

    As at December 2014, the company represented more than 50 international brands, including Breguet, Bulgari, Cartier, Girard-Perregaux, IWC, Jaeger-LeCoultre, Longines, Mido, Omega, Rolex, Scatola del Tempo, TAG Heuer, Tissot, Vacheron-Constantin, Van Cleef & Arpels and Zenith.

    Last year Hengdeli added Manufacture Royale, MB&F and Vulcain to its portfolio as it stepped up its efforts to “bring in and align mid-end, mid-to-high end and high-end brands across both Mainland China and Hong Kong”. The company said it believes optimising the brand portfolio will pave the way for long-term business development and increased sales.

    According to recently filed 2014 financials, Hengdeli recorded turnover of RMB 14,764,370,000 (US$2.379 billion); an increase of 10.4 per cent year-on-year. Retail sales amounted to RMB 10,608,804,000 ($1.71 billion), an increase of 6.3 per cent year-on-year. Of this figure, retail sales in mainland China posted a year-on-year increase of 11.6 per cent to reach RMB 6,248,240,000 ($1.007 billion), while Elegant Hong Kong’s retail sales experienced a year-on-year decrease of 17.7 per cent to RMB 2,593,388,000 ($418 million). Excluding the impact of foreign exchange gains and losses, the decrease was 16.6 per cent.

    Group sales remained at the same level as in 2013, indicating a slowing of expansion. “Growth of our total retail sales was mainly generated by domestic retail outlets and mid-end brands. While continuing weak sales of high-end watches had some impact on the total retail sales, the new normality of China’s economy and our strategy of aligning operations with market dynamics has paid off. As a result, the decline in sales of high-end watches in Mainland China began to slowdown.”

    The company says sales of mid-end brands remained favourable, posting a year- on-year growth of 16.1 per cent. Same-store sales of mid-end brands also grew by 2.2 per cent, which was above the group’s average growth for the year.

    The group recorded net profit of RMB 583,427,000 ($94 million); an increase of 24.4 per cent year-on-year.

    As well as focussing expansion on less high end brands, Hengdeli actively expanded into mainland China’s second, third, and fourth-tier cities while building market shares in first-tier cities, and establishing a multi-level sales system across Mainland China and Hong Kong.

    At year end, the Group operated 513 retail outlets in mainland China, Hong Kong, Macau and Taiwan.

    The Group’s retail network covers the Greater China Region, where retail stores mainly includes Prime Time/Hengdeli, Elegant as well as certain other single-brand boutiques. Prime Time/Hengdeli mainly sells mid-end and mid-to-high-end international brands, while Elegant focuses on top-end internationally renowned brands.

    Prime Time is the major retail outlet arm of the Group in Mainland China and mainly sells internationally renowned mid-end and mid-to-high-end branded watches.

    Hengdeli says in 2015, China’s economy looks likely to continue to evolve despite ongoing global economic uncertainties.

    “We believe that the resultant new normality will continue to create exciting fresh opportunities for the group.”

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  • Lululemon eyes Asia growth

    Lululemon eyes Asia growth

    Yogawear retailer Lululemon sees a positive future in Asia, despite bad experiences in Japan and Australia.

    Announcing a 13 per cent jump in global revenue in 2014 to US$1.6 billion, the Canadian company reiterated plans to open a new store in Hong Kong this year.

    The company plans 20 new stores in Europe and Asia this year with Hong Kong, Germany and the UK singled out as priorities.

    CEO Laurent Potdevin told analysts in a conference call he believed international revenues could eventually exceed those from North America.

    Lululemon currently has stores in Singapore, Hong Kong, China, Australia and New Zealand.

    It once had stores in Japan but withdrew from that market in 2009 after poor sales. It has also trimmed its network in Australia where sales failed to meet expectations.

    Besides Asia, the company is bullish about its prospects in the Middle East.

    It has a partnership with Dubai-based retail conglomerate Majid Al Futtaim to open stores in the UAE, Qatar, Bahrain, Oman and Kuwait. The first store is scheduled to open in Dubai late this year

    Potdevin described 2014 as “a critical year when we strengthened our leadership team and made important investments in our product pipeline, guest experience, brand, and community engagement”.

    “In 2015, we expect to substantially complete this foundational work and accelerate our investments in innovation to drive sustainable global growth as we continue to lead the market that we created,” he said in an earnings statement.

  • Global Brands revels in maiden result

    Global Brands revels in maiden result

    Global Brands, the listed Li & Fung spinoff, has reported its first trading result – reveling in a 37 per cent profit rise.

    The Hong Kong based company listed as an independent business on July 9, a move CEO and vice chairman Bruce Rockowitz says afforded it the freedom to fully build its brands business and pursue its own distinct and focused strategy. That strategy includes a direct-to-consumer business,, which would not have been possible under the Li & Fung business model. “At the same time, we continue to enjoy the benefit of being a member of the Fung Group.”

    Group sales in the second half totalled US$2.105 billion, up 7.5 per cent on the same period the previous year, while profit rose 36.6 per cent to $217 million.

    Merging the half years under the two ownerships into one set of figures, annual sales reached $3.454 billion and profit $154 million .

    Rockowitz says the business will continue to primarily concentrate on ‘American power brands’ through Licensed Brands and Controlled Brands divisions.

    “On the Licensed Brands side, we continue to sharpen the focus of our platform in terms of both the product categories that we offer and the brands that we work with, while expanding the platform globally.

    “One notable achievement of our efforts is that today we are among the largest licensed brand companies within the kids sector, a success that is based upon our leadership position in characters as well as in kids fashion. We have a truly global platform in the kids area, and we are working hard to further strengthen our prominent position in key categories and geographies worldwide.

    “In the US, notable achievements include the master licensing agreement that we signed with Disney in the sleepwear category in August. In Europe, our focus has been to integrate our businesses across major markets to strengthen our leadership across the region. In China, we have successfully established a strong platform for the kids fashion and character businesses.”

    Global Brands is also building its licensed brands portfolio , securing deals with major American brands in footwear and accessories: a new global accessory licensing relationship was signed with Cole Haan last year, and in January 2015, with Kate Spade.

    “In addition, we renewed our global footwear license agreement with Coach. These are all highly successful affordable luxury brands with strong growth momentum,” said Rockowitz.

    The company exited its private label jewellery business post listing and consolidated its home and women’s apparel offers to ensure each is run more efficiently.

    On the Controlled Brands side, the company made special mention of Frye, an American brand with a strong heritage.

    “Our Frye retail stores delivered strong results, while sales through our eCommerce portal Frye.com also recorded significant growth. Looking ahead, we see the further expansion of our retail footprint, growing online sales and extending our product offering as being the key drivers to building Frye into a global lifestyle brand. We have also made a number of key hires to accelerate growth.”

    Spyder has established itself as “a high end, high performance” skiwear brand in the US and Europe.

    “We are working to expand its presence in other geographies as well as in other product categories. In particular, we believe this is an opportune time to make a big push for Korea (the host country for the winter Olympics in 2018) and China. We believe the brand’s edgy aesthetics and high performance will resonate well in these key Asian markets.”

    Juicy Couture has started with very strong sales momentum and retail partners are actively working on a plan for new store openings globally.

    Aquatalia, though much smaller in scale than Frye, has proven its brand appeal, and expanded into menswear with a Fall 2015 collection.

    In December, Global Brands announced a joint venture with David Beckham and his business partner Simon Fuller. The joint venture, Seven Global, focuses on the continued development of the brand around David Beckham as well as on creating large scale brands in partnership with a select number of high‐profile sports and entertainment icons. The venture will cover all major consumer product categories.

    “We are extremely excited about the prospects that lie ahead for Seven Global,” said Rockowitz. “With our strong global platform of TLC, one of the world’s leading brand management companies that we acquired in January 2014, we are confident we can establish Seven Global as a trendsetting enterprise in the sports and entertainment space.”

    Rockowitz said although the macroeconomic environment remains complex, the company expect its margins will continue to trend upwards due to its growth in scale, improvement in gross margins and an improving business mix in favor of higher‐margin businesses, and an ongoing focus on integrating its businesses and rationalising the cost structure, while exiting unprofitable and non‐core businesses.

    “As we continue to grow and strengthen our business, one strategic priority is to extend our global reach. We have established a leading platform in our space in the US, which will remain our largest geography for the foreseeable future, and we believe we can successfully replicate this in Europe and Asia.”

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  • Amazon to acquire Net-A-Porter?

    Amazon to acquire Net-A-Porter?

    Speculation is rife that e-commerce giant, Amazon, is in talks with online luxury retailer Net-A-Porter for what could be its biggest acquisition yet.

    Luxury goods group, Richemont, bought Net-A-Porter in 2010 for around €350 million (A$492.35 million).

    Net-A-Porter, has seen huge growth in the last few years, and is reportedly worth more than £2 billion globally.

    Founded in 2000, Net-A-Porter stocks more than 350 designers including Alexander McQueen, Chloé, Dolce & Gabbana, Isabel Marant, Jimmy Choo, Miu Miu, Stella McCartney, and Valentino.

    In 2009, the company launched discount fashion website, The Outnet, and in 2011 created menswear website, Mr Porter. In 2014, Net-A-Porter Group’s publishing division  launched the company’s first ever consumer magazine, Porter.

    Following a series of investments, including a significant push into fashion, Amazon surprised the market with far better than anticipated Q4 profit results.

    Amazon posted earnings of $US214 million ($A275.88 million) in the fourth quarter as sales jumped 15 per cent to $US29.3 billion, swinging to profit after two consecutive losing quarters.

    The Seattle-based company faced pressure from shareholders to deliver profits even as founder Jeff Bezos invested in a vast array of projects.

    For the full year 2014, Amazon posted a net loss of US$241 million on sales of US$89 billion.

    Amazon has denied speculation of the Net-A-Porter acquisition.

  • China sinks Prada profit

    China sinks Prada profit

    Luxury retailer Prada Group has blamed China for a 28 per cent slump in profit last year.

    The Italian company says sales in its key Asia-Pacific market – which contributes 35.7 per cent of its global turnover – slid 3.1 per cent.

    This was largely due to the clampdown in corporate gift giving as China tries to reduce graft, and changing purchasing patterns in Hong Kong, which cashed up Chinese are spurning for other travel destinations.

    “Results in the region were hit by the negative performances recorded in Hong Kong and Macau. The Greater China area still benefited from growth on the [mainland] Chinese domestic market and ended the year with net sales of 774.1 million euros, a decrease of 6.3 per cent,” the company said.

    While Prada accounts for 81.2 per cent of the group’s sales, Miu Miu and Church’s both improved globally, while the smallest, Car Shoe, returned a sales drop of 11.9 per cent.

    Prada opened 21 new stores in Asia Pacific in the year to January 31 and closed three. Retail sales slid 5.5 per cent, but this was in part compensated for by a double digit growth in the wholesale division, largely due to increasing numbers of inbound tourists into South Korea. In the Americas, sales were up 0.9 per cent.

    In Europe, sales fell 4.9 per cent, but in Japan (which is not included in the Asia-Pacific figures) sales rose 7.9 per cent, despite store network rationalisation.   Prada said overall revenue for the year dipped by one per cent to 3.55 billion euros, while net income dropped to 450.7 million euros from 627.8 million euros a year earlier. Its operating margin was down from 31.9 per cent to 26.9 per cent, largely due to store openings.

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  • Cotton On tells staff to keep it real or face the sack

    Cotton On tells staff to keep it real or face the sack

    It may be a new low in human resources gibberish.

    But the fun crowd at retailer Cotton On have told staff they need to “keep it real” or face the sack.

    A leaked copy of Cotton On’s code of conduct tells its staff it is “unacceptable” when working with colleagues or customers, to be anything but “fun” and “keeping it real”. No ifs or buts. Failure to do so can result in being fired on the spot.

    Less well defined in the document is what “keeping it real” means. The Online Slang Dictionary tells us that to “keep it real” is to “stay true to one’s self; to resist the temptation to be fake”. One claim is that the origins of the phrase emerged out of hip-hop culture in New York in the late 1970s and early 1980s.

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  • Ashapura plans to open 200 stores across India in 3 years

    Ashapura plans to open 200 stores across India in 3 years

    Ashapura Intimates Fashion plans to open 200 Valentine loungewear retail showrooms across the country in three years on a franchise basis.

    It plans to open 26 Valentine showrooms in Mumbai this year, most of which will be company-owned, it said in a statement on Monday.

    The first Valentine showroom of 1,550 square feet was opened at Bandra in December 2014, following the state’s largest loungewear showroom spread over two floors in Mulund.

    The third store was opened at Ghatkopar this month and another two stores are expected to come up at Borivali and Thane by April, it added. Ashapura is also planning to open its third Valentine loungewear retail showroom in Bangalore this month, following a similar one launched last month.

    Two stores will be opened in Ahmedabad next month, it said.

    Harshad H Thakkar, Chairman, Ashapura-Valentine Group, said with its second plant going on-stream soon in Gujarat, the company will have the highest loungewear production and warehousing capacity in India.

    Ashapura sells intimate garments such as lounge wear, bridal night wear, honeymoon sets, bathrobes, nightwear, relax-wear and sportswear.

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  • British bag brand Zatchels eyes Asia

    British bag brand Zatchels eyes Asia

    Hip British bag brand Zatchels says it plans to make inroads into Asia as its young brand gains international awareness.

    Zatchels was established in April 2011 and has its manufacturing base in Leicester, UK.  A multi-channel retailer, it has shops in York, Westfield London and now Bath.

    Now it says it wants to enter Vietnam, Thailand, Cambodia and Singapore to make the most of their young populations and a growing love of products made in Britain among southeast Asians.

    The company manufactures and retails, with boutique stores in the UK. Overseas stores are usually operated as concessions in department stores.

    The manufacturer already exports a third of the designer satchels and bags made at its factory near Leicester’s city centre to around 90 countries. It makes more than 25 styles of bags, turns over £3.5 million annually and employs 70 people in manufacturing and retail.

    Zatchels store York 315*The Zatchels store in York.

    The business has just hosted a visit by Douglas Barnes, HM Consul General to Ho Chi Minh City and Director of Trade and Investment Vietnam, to discuss the opportunities available.

    MD Dean Clarke, who founded Zatchels with business partner Brian Brady, said exports are a growing and vastly important part of the company’s business plan for 2015 onwards.

    “We hope to include Vietnam in those plans, along with other important areas of South East Asia and the Pacific region,” Clarke said in an interview with the Leicester Mercury newspaper.

    “Meeting with Mr Barnes gave us the opportunity to further investigate this emerging high growth country in more detail and potentially make influential contacts to help us grow our business in this exciting market.”

    Barnes said Vietnam is one of the fastest-growing retail markets in the world and there is a huge demand for products as consumer spending power grows.

    “It has a young and dynamic population – with 60 per cent under the age of 30. I am impressed with Zatchels’ hugely ambitious approach to exports which has placed them at the top of their game and I’m keen to help them develop their business in Vietnam.”

    Zatchels focuses on making quality leather goods, with each bag made to order. Zatchels currently has 10 Collections designed for men, women and children as well as a range of accessories.

    Zatchels people inside 315

     

  • Hugo Boss takes control in Asia

    Hugo Boss takes control in Asia

    German luxury fashion retailer Hugo Boss is forging ahead with plans to take direct control of its Asian store network as it looks to the region to offset stagnant sales growth in Europe.

    Hugo Boss says it will take over 17 franchise stores in South Korea and set up its own distribution company in Dubai.

    It will also take over all of its stores in China, currently operated by a joint venture, with plans for 130 shops in the mainland.

    The Russian market is crumbling, on concert with its currency, the rouble. And Germany’s luxury fashion market has lost its lustre in recent times. Fashion retail sales slid eight per cent in the fourth quarter of 2014 according to independent data. Investment house Goldman Sachs Group has advised clients to sell Hugo Boss shares, predicting little growth for the company in 2015.

    But the German company remains optimistic, focusing its hopes on Asia, especially China, where it says there is a growing thirst for luxury fashion.

    “Looking ahead over the next few years, Hugo Boss faces excellent prospects for growth,” said Claus-Dietrich Lahrs, CEO, in a statement.

    In its latest quarterly earnings statement, Hugo Boss reported group-wide sales growth of five per cent to US$721 million and pre-tax earnings of $176 million.

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  • French Connection on comeback trail

    French Connection on comeback trail

    UK fashion chain French Connection has reduced its full year loss as sales recover.

    FCUK has reported an £800,000 underlying operating loss for the year to January 31 – vastly better than the £4.4 million loss in the year to January 31, 2014.

    The retailer, once notorious for its casual fashion items bearing slogans with its abbreviated name FCUK, had fallen out of favour with customers when the ‘joke’ wore off. It subsequently changed its labeling to French Connection and tried to move more upmarket path with its design positioning. But that change took years to gain favour with shoppers.

    The company spent the last year closing unprofitable stores and redesigning its product range.

    Announcing its figures this week, FCUK said same store sales across the UK fell by three per cent year-on-year, citing unusually warm weather in the second half of the year for the drop, in concert with its rivals.

    Wholesale revenues rose 4.6 per cent.

    Chairman and CEO Stephen Marks said despite “difficult retail trading conditions” in the second half the results demonstrated the company has made another step towards returning to profitability.

    “Although we are encouraged by forward orders in our wholesale business, trading on the high street remains challenging and we are planning accordingly.”

  • Crocs India terminates franchise deal

    Crocs India terminates franchise deal

    US shoemaker Crocs has cancelled its exclusive franchising agreement in India with Chogori Retail.

    The Colorado-based company, renowned for its unsightly but comfortable shoes, says it will now partner with several retail companies and will ramp up its store roll-out program.

    Crocs debuted in India in 2007 after entering into an exclusive joint venture deal with Chogori retail. Later the contract was converted into a franchise agreement.

    But the venture has been far from successful to date. After eight years the brand has just 30 stores in India, after closing about 12 during the last eight months.

    Crocs says by opening the door to other partners in the fast growing market it can open about 60 new stores over the next three years. The company also has a successful eCommerce operation which already accounts for 10 per cent of its India sales.

    “We have planned out a strategy of having few but strong franchise and shedding some of the partners that don’t, can’t or won’t want to grow with us whatever the reason might be,” said Nissan Joseph, Crocs India GM.

    The last of the Chogori JV stores would close by June.

    “Some will close and reopen, some will reopen in different locations inside the mall and some will reopen through new franchise partners,” he said.

    Chogori, meanwhile, has other priorities. It is the India licensee for Hi-Tec, amongst other brands, and has recently announced a partnership with US adventure wear brand Columbia Sportswear to open 25 stores.

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  • Trinity weathers stagnant China market

    Trinity weathers stagnant China market

    Li & Fung subsidiary Trinity, which retails high-end menswear Greater China and Europe, has weathered a stagnant home market in 2014.

    The company posted revenue of HK$2.6 billion (US$335.2 million) and the gross profit was HK$1.9 billion ($244.95 million). The gross profit margin was 74.1 per cent representing a 1.4 percentage point decline due to liquidation of excess inventory, a management priority in the second half.

    Trinity’s brands include D’Urban, Gieves & Hawkes, Cerruti 1881, Intermezzo and Kent&Curwen CEO Richard Cohen said Trinity achieved the performance milestones it set out last August and is on track with its medium-term strategy.

    He said the company was putting in place “the right retail strategy and structure” to deliver consistent, sustainable returns into the future.

    “We have significantly strengthened our teams up and down the organisation and continue to improve inventory management. In the past six months we have developed centralised shared services across all departments and improved our supply chain to make it more cost-effective and flexible.”

    Cohen said that Trinity remained bullish about the Chinese market and opportunities to serve the Chinese consumer, whether at home or travelling abroad.

    “We target globally and think locally,” he said.

    “We are optimistic for the near and medium-term, and remain confident about the longer term potential for our business.

    “We are looking forward to 2015 when the first Trinity collections developed by the new management team appear in stores.”

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  • Marc Jacobs partners with ImagineX

    Marc Jacobs partners with ImagineX

    Marc Jacobs International and ImagineX Group have established a 50-50 joint-venture companies in both Hong Kong and Macau to take over distribution of Marc Jacobs collections in Hong Kong and Macau.

    Marc Jacobs Hong Kong Distribution Co has taken over the existing retail network as a base for an ambitious development of Marc Jacobs brands in terms of sales and network development. Marc Jacobs Macau Distribution Co will set up a retail network during the coming months.

    ImagineX Group, part of The Lane Crawford Joyce Group, is a specialist retail, brand management and distribution company operating in Greater China and South East Asia.

    It has fashion partnerships with brands Salvatore Ferragamo, Marc Jacobs, Donna Karan, Paul & Shark, Paul Smith, DKNY, Club Monaco, alice + olivia by Stacey Bendet, Scotch & Soda, Tory Burch and Isabel Marant among others.

    Marc Jacobs International has more than 200 free standing stores across the globe, and the brand includes Women’s and Men’s RTW and accessories, a children’s line called Little Marc Jacobs, multiple award winning fragrances, and Marc Jacobs Beauty, which will launch in Asia later this year.

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